World Farming Agriculture Commodity news - Weekly Updated - Exclusive and very popular -
Agri commodity markets are inherently cyclical, driven by the forces of supply and demand. Since the end of 2023, row crop markets have shifted from a high to a low phase, bringing significant distress to the market, pressuring margins. This transition follows a period of elevated commodity prices that began around Q4 2020, when a contraction in ending stocks, due to production losses in the US and Argentina, led to a surge in prices. For instance, soybean prices rose sharply, surpassing USD 10/bushel in October 2020 and reaching USD 15.72/bushel by May 2021, significantly higher than the average price of USD 9.47/bushel observed between 2015 and 2020. Corn prices experienced a similar upward trend.
Agri commodity markets are inherently cyclical, driven by the forces of supply and demand. Since the end of 2023, row crop markets have shifted from a high to a low phase, bringing significant distress to the market, pressuring margins. This transition follows a period of elevated commodity prices that began around Q4 2020, when a contraction in ending stocks, due to production losses in the US and Argentina, led to a surge in prices. For instance, soybean prices rose sharply, surpassing USD 10/bushel in October 2020 and reaching USD 15.72/bushel by May 2021, significantly higher than the average price of USD 9.47/bushel observed between 2015 and 2020. Corn prices experienced a similar upward trend.
Grain farmers in the United States are in a financial pinch and may want to look north of the border for a way out, says an analyst. Growers have been cutting costs during the last 2.5 years of the current downcycle. They have reduced equipment purchases, cut back on fertilizers and crop protection products and are negotiating lower land rents. Now they are increasing operating lines of credit for the first time in years, said Owen Wagner, grains and oilseeds analyst with RaboResearch Food & Agribusiness. It is reminiscent of what happened during the last downturn in 2013 and 2014. Agricultural lines of credit in the U.S. surged to US$100 billion by 2016, from about $80 billion before the downturn.
According to the latest La Nina advisory, nearly all models predict it will continue through early 2025. The different models disagree over the eventual strength of this La Nina event, but recent data suggests it will be weak and short-lived. This would likely result in limited impact on our weather this winter, so confidence in the long-range forecast is low. Let’s look at what has happened during previous La Nina winters. Sometimes it easier to show the impact of different weather events with a map. The acommpanying map shows the typical impact on our weather during a La Nina winter across Canada and the U.S. Typically we see colder than average temperatures, as indicated in the long-range computer forecasts. In our recent winter weather outlook, the computer models almost all predicted a warm start to the winter, followed by colder than average conditions in the second half.
New Holland updates T4 Specialty tractors with new MY25 versions -Multiple updates for model year 2025 New Holland T4 specialty tractors mean the new versions offer greater performance and increased comfort in a restyled package. The new tractors are easily identifiable thanks to revised styling, with a refreshed logo and decals matching larger New Holland tractors, new light bezels and new LED turn/indicator lights integrated into the A-pillars. Fruit (F) and Narrow (N) cab models equipped with SuperSteer™ and a horizontal exhaust now benefit from 20% greater fuel capacity, for a total of 95 litres on F tractors and 75 litres on N versions. A new steering sensor on all 4wd front axle models – standard, suspended and SuperSteer™ – disconnects 4wd automatically when the wheels are turned, for reduced soil damage and driveline stress. A new auto-detect hydraulic trailer brake valve is also now available.
The Quadtrac 715, the new top model in the Case IH tractor range, has won the Tractor of the Year 2025 HighPower Category for models of 300hp+, on the first day of EIMA 2024 in Bologna, Italy.The latest Quadtrac development, a heavy-duty mechanical suspension with hydraulic cushioning bringing additional comfort and productivity benefits to all MY2025 models, has already been recognized with an EIMA Technical Innovation Award. Bigger drive wheels maximize power transmission and provide more lug engagement, while a larger footprint boosts traction and reduces soil compaction. This is aided by double-axis mid-rollers that equalize pressure across each track, eliminating point loading. Greater comfort allows operation at higher field speeds, enhancing work rates. Service time is minimized through automatic track tensioning, elimination of undercarriage greasing points, clear-view oil caps and maintenance-free bushings and pins.
World Farming Agriculture and Commodity news - Short update -04th November 2024
SOUTH AFRICA
According to the El Niño Southern Oscillation (ENSO) Diagnostic Discussion Panel, the prospects of La Niña weather have receded from 60% in its October 2024 release to the latest 57% chance issued in November 2024. La Niña is likely to emerge during the October to December 2024 period and it is expected to persist through January to March 2025. The declining probability of La Niña demands close monitoring and careful management of the situation on the ground. The Crop Estimates Committee released the 3 rd 2024/25 winter crop production estimates. Wheat is forecast at 1.96 million tons, up by 1.3% from the 2 nd forecast. Canola is forecast at 295 165 tons, up by 0.2% from the 2 nd forecast. Statistics South Africa released the Quarterly Labour Force Survey, which is data on the labour market activities of individuals aged 15 years and older who live in South Africa for the third quarter of 2024. The agricultural sector was one of the sectors that recorded employment gains, with the number of people employed in the sector increasing by 39 000 or 4.4% quarter-on-quarter to 935 000 people. This increment was mainly spurred by Limpopo, Gauteng, the Western, and Eastern Cape provinces.
This week, the rand averaged R18.03/US$, weakening by 2.9% w/w but strengthening by 2.4% y/y. The local currency weakened following Donald Trump’s US election win and ahead of S&P Global’s scheduled review of South Africa’s sovereign credit rating. • This week, the Brent crude oil price averaged US$72.36/barrel, down by 2.5% w/w and by 8.7% y/y. Oil prices declined mainly on OPEC’s reduced demand forecast and US$ strength. • The price of Brent crude oil has decreased slightly relative to October 2024. The lower oil price is, however, likely to be overridden by a depreciated rand. For the remainder of this month, we expect the oil price to remain somewhat stable and the exchange rate to remain weak. As a result, the following local fuel price increases are forecast for 04 December 2024: petrol (95 unleaded) by 50c/l; diesel 500 ppm and 50ppm by 64c/l and 62c/l, respectively.
The yellow maize price averaged R4 927/ton, up by 3.1% w/w and by 29.6% y/y. The white maize price averaged R5 965/ton, up by 1.9% w/w and by 46.8% y/y. • Domestic maize prices posted some gains this week on the back of a weaker rand, tighter supplies, and good buying demand. Fundamentally, the surge seen in white maize primarily reflects the impacts of the 2024 El Niño drought on the harvest, with the weaker local currency also adding to this surge. • Chicago maize prices faltered yesterday on trader concerns about the implications of the Trump victory on domestic demand. This is due to his administration’s anticipated unfriendly stance on the biofuel industry. • In week-28 of the domestic 2024/25 MY, 10.363 million tons of white and yellow maize had cumulatively been delivered. In the same week, cumulative exports of white and yellow maize reached a combined 1.202 million tons. • The top three export destinations of white maize were Zimbabwe (433 567 tons), Namibia (118 346 tons), and Mozambique (54 517 tons). The top three destinations of yellow maize were Zimbabwe (229 894 tons), Eswatini (47 756 tons), and Mozambique (35 469 tons).
The soya bean price averaged R8 965/ton, up by 2.5% w/w but down by 4.6% y/y. The sunflower seed price averaged R11 027/ton, up by 0.5% w/w and by 21% y/y. • The domestic oilseed prices were supported by rand weakness and international buying demand. • Chicago soya bean contracts slumped due to traders assessing the impact of Trump’s incoming administration, that is viewed as unfavourable for the biofuel industry. • Cumulative domestic oilseed deliveries by week-37 of the 2024/25 MY stood at 1.755 million tons of soya bean and 627 399 tons of sunflower seed.
The wheat price averaged R5 834/ton, up by 2% w/w but down by 1% y/y. • The domestic wheat prices got support from the weaker rand. • In week-06 of the new 2024/25 MY, cumulative wheat deliveries were at 290 524 tons. • In the same week, cumulative wheat imports stood at 226 164 tons, with the 70 368 tons coming from Russia, 65 703 tons coming from Lithuania, and 54 105 tons coming from Canada.
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