The United Nations - raising its estimates for world grains production, including US corn output - forecast "greater stability" in prices, even as it flagged the biggest fall in cereals values in four years.
The UN's Food and Agriculture Organization lifted by 14m tonnes to a record 2.492bn tonnes its forecast for world output of coarse grains, rice and wheat in 2013-14, an upgrade reflecting "expectations of higher corn production in Argentina, the European Union and Ukraine".
The raised hopes for the EU contrast with reduced expectations within the region, with commission officials last week cutting their yield estimate by 0.25 tonnes per hectare to 6.97 tonnes per hectare.
The FAO also, against the run of market thinking, upgraded its estimate for the US corn crop, by 3m tonnes although, at 343m tonnes, its fresh forecast remained below the 359.6m tonnes that the US Department of Agriculture has pencilled in.
On wheat, the organisation raised its world harvest forecast to a record 710m tonnes, above the estimate from the USDA, as well as the International Grains Council which on Friday pegged output at 690.6m tonnes.
"Much of the expected increase in global wheat production is forecast to occur in Argentina, Australia, Canada and the European Union," the FAO said.
The revisions leave the world facing a 13% rise in world cereals stocks over the season to 569m tonnes, equivalent to 23.3% of consumption, the highest ratio in 11 years.
The stocks-to-use ratio, in indicating the availability of a commodity, is viewed as a key indicator of price potential.
"The overall supply-demand situation for cereal markets is much improved over this time last year when drought-hit production and low stock-to-use ratios, especially for corn, raised serious concerns," said David Hallam, director of FAO's trade and markets division.
"Higher stock-to-use ratios should bring greater stability to world markets."
The comments came even as the FAO revealed a tumble of 7.2% in world grain prices last month, the biggest month-on-month decline since July 2009.
The decline "is consistent with expectations for strong growth in world cereal production this year and, especially, a sharp recovery in corn supplies", the agency said.
Prices of some other foods rose, including sugar, which added 1.1%, "mostly due to estimates showing that Brazil, the world's largest sugar producer and exporter, was using more sugar cane for ethanol production at the expense of sugar".
Dairy prices rose 1.3%, as "with milk production declining seasonally in the northern-hemisphere and the new production season only just starting in Oceania and South America, availabilities for the remainder of 2013 are uncertain".
Nonetheless, the FAO's overall food price index fell 1.8% on the month to its lowest since June last year, and down 15.2% on a high reached in February 2011.