US and Brazil crops and lower demand from China alleviate scarcity fears

Large harvests in the United States, near-perfect weather for planting in Brazil, and signs of a slowdown in purchases by the main buyer, China, are increasing the offers of two of the main commodities traded globally: soy and corn.

Higher inventories indicate that prices for these main crops, as well as other basic products such as sugar and coffee, may have peaked after the increase caused by the pandemic, according to farmers, negotiators, and analysts.

Lower prices for agricultural products would be good news for consumers after global food prices soared to the highest level in a decade, according to the United Nations food agency.

Decreased supply and strong global demand over the past 18 months have boosted food inflation and raised scarcity fears.

Cheaper soybeans and corn would reduce the cost of feeding livestock and the meat industry. But falling prices could threaten farmers’ profits, especially after seed and fertilizer companies raised farm input prices.

Source: Money Times

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