Commodity Tracker: 5 charts to watch this week

10/08/2021

Topic: August 2021 commodity charts

In August of 2021, tight global supply and market conditions led to high European gas prices, with EU gas stocks at just 58 percent full at the time and many wondering if storage sites will be sufficiently filled to sustain Europe during the winter. In the US Northeast market area, winter gas prices rallied at an all time high following concerns over flat production from Appalachia and lagging regional gas storage inventories. In Iran, Ebrahim Raisi’s inauguration as President came after conflicts between July and early August, with Raisi supporting a return to negotiations with Western European and North American powers regarding nuclear talks and resurrecting Iran’s oil sector. In Russia, 50.2 million megatonnes of wheat were harvested between the start of the 2021-2022 marketing year and August 3, while as of July 29, 1.7 million megatonnes were exported. However, S&P Global Platts Analytics decreased its estimate for Russia’s wheat output for 2021-2022 to 80.2 million megatonnes, citing the decline in the winter crop area. Finally, the Electric Reliability Council of Texas (ERCOT) approved 590.4 megawatts of new generation capacity for commercial operation in July. 

Weather shocks in Brazil ripple across global commodities

18/08/2021

Topic: Drought and cold weather impacts Brazil’s farming belt

Brazil’s farming belt braced for the cold weather and dry conditions promised by the La Nina weather phenomenon that was to follow shortly after “the worst drought in nearly a century” experienced by the country. The inhospitable weather conditions simultaneously led to a sharp spike in prices for coffee and sugar in international markets and gave bullish corn traders “further fuel.” Initial estimates of production losses for next year’s crop of coffee vary between 10 to 50 percent, which in turn has pushed up prices. Similarly, corn growers were affected by the drought and frost, with many cutting their Brazil corn production numbers as a result. For the livestock feed industry, a corn shortage has forced the industry to rely on imports, with normal overseas purchases of about 1 million megatonnes expected to increase to 3.5 million to 4 million this year. Orange and sugar output is also expected to be impacted by the frost. Some scientists, such as Lincoln Muniz Alvez at the National Institute for Space Research, have linked the recent drought to the deforestation of the Amazon rainforest, while agricultural experts are concerned that the recurrence of La Nina may push the drought conditions into the new year.

What the soaring cost of breakfast may signal for global food price inflation

28/05/2021

Topic: Price surge in raw materials for breakfast staples related to the pandemic

Since the pandemic began, the cost of raw materials used in producing breakfast staples has soared, with many concerned that a commodity boom may push up global food prices for consumers. Culprits of these rising prices for agricultural products include dry weather in key exporting countries, strong demand from China, and government stockpiling of grains following the outbreak of the pandemic. Butter, coffee, milk, sugar, and vegetable oil prices have surged, while futures prices for white corn and rice have increased drastically. As a result of this increase in costs of raw materials, food companies such as Nestle and Unilever announced price increases earlier in the year. Significantly, The Baltic Dry index hit its highest point in more than a decade. For countries such as Egypt and Pakistan, who import a large share of their food, a spike in shipping costs has also added to ingredient prices. 

China hog stocks shed $75bn after swine fever recovery and ‘peak pork’

01/09/2021

Topic: China’s recovery and low demand for pork following swine fever

Following massive losses from African swine fever, a resurgence in pork supplies in China has cleared approximately $75 billion of the country’s pork-related equities. The outbreak, which first occurred in August 2018, had just about halved the size of China’s hog herd in 2019, and although supplies have risen and officials have stated that China has fully recovered from the impact of the outbreak, Chinese hog futures dropped more than 50 percent since they first began trading this year. Darin Friedrichs, an analyst at Shanghai-based StoneX, noted that China has “‘entered a period of structurally lowered demand’” after high prices for pork led many Chinese consumers to turn to other proteins.

Rising wheat prices make pasta and bread expensive

09/09/2021

Topic: Surging wheat prices and tight supply impact bread and pasta production

A tightening wheat supply across Russia, Canada, and the US and increased wheat prices have meant that end products such as bread and pasta have become costlier for importing countries. The USDA lowered world wheat supply estimates for the 2020-2021 marketing year by 16.8 million megatonnes to 1.066 billion megatonnes. Meanwhile in Russia, wheat output was reduced by 12.5 million megatonnes to 72.5 million megatonnes as a result of a probable smaller winter wheat harvest due to frost between February and March. In Canada, wheat production was lowered by 7.5 million megatonnes to a ten-year low of 24 million megatonnes as a result of drought across the Prairies in July. In the US, wheat production went down 1.3 million megatonnes to 46.2 million megatonnes as a result of similar drought conditions between July and August. Globally, export prices of wheat have increased between 21 percent and 30 percent, generating higher prices for end products for major wheat importers such as Egypt, France, Italy, and Turkey. Egypt proposed to increase subsidized bread prices, which have been fixed for 20 to 30 years. Packaged pasta prices in France are likely to rise an average 10 to 20 percent due to increased durum wheat prices. Italy, who imported nearly 2 million megatonnes of durum wheat from Canada and the US in 2020-2021, may have difficulties meeting its requirement in the 2021-2022 marketing year. Turkey, which sources almost half of its imported durum wheat from Canada, also faces shrinking sources. In the US, a significant increase in bread prices has been seen. As for global durum wheat supplies, according to the USDA, both Canadian and US durum wheat exports plummeted to the lowest since the 1964-1965 marketing year. However, Mexico and the EU gained the chance to increase exports in 2021-2022, with Mexico’s wheat production forecast having gone up 9 percent higher at 1.3 million megatonnes and the EU’s production forecast up by 7 percent to 7.7 million megatonnes. In Russia, a smaller winter wheat crop is partly offset by a larger spring wheat output and significant carryover at the end of 2020-2021, but Russia’s floating export tax on wheat may cost its market share to the EU and Ukraine. Finally, in regard to price outlooks, Australian prices have risen nearly $60 per megatonne; Ukrainian quotes have risen over $70 per megatonne on the year; Russian quotes have risen nearly $90 per megatonne on the year; and Canadian quotes have risen over $40 per megatonne on persistent drought and negative harvest outlook.

It’s been nearly 20 years since inflation has been this high in Canada

20/10/2021

Topic: Canada’s inflation rate surges to a new nearly 20-year high

Higher prices for transportation, food, and shelter have led to Canada’s inflation rate rising to a new 18-year high of 4.4 percent in September of 2021. According to Statistics Canada, the transportation index has risen by more than 9 percent, gasoline prices have risen by almost 33 percent, and the prices for new cars have risen by 7.2 percent in the past year. Meanwhile food costs have surged by 3.9 percent and shelter costs have surged by 4.8 percent. Policymakers’ initial downplay of the threat of rising prices as a result of the pandemic and its impact on demand has been contradicted by many economists, who are inclined to think that high inflation may last longer than policymakers initially thought.

National Workforce Strategy for Agriculture and Food & Beverage Manufacturing Will Help Address Chronic Labour Issues in Agriculture

13/10/2021

Topic: CFA and others develop a National Workforce Strategy for Agriculture and Food and Beverage Manufacturing

The Canadian Federation of Agriculture (CFA) is partnering with Food and Beverage Canada, the Canadian Agricultural Human Resource Council, and the Future Skills Centre to develop a National Workforce Strategy for Agriculture and Food and Beverage Manufacturing in response to chronic labour issues in agriculture. The two-year project “will establish an actionable roadmap to lead the way in addressing workforce and skills shortages in agriculture and the food and beverage manufacturing industry.” The first year will collect information on existing programs and services, identify gaps, and recommend new programs and tools; the second year will develop the project. 

Canada’s food inflation figures are wrong, critics say – mainly because just three grocers supply the data

23/10/2021

Topic: Critics claim Canadian food inflation figures incorrect

After collecting data on the prices of three food sources (evaporated milk, peanut butter, and butter), Melanie Morrison, who runs Saskatoon-based company BetterCart Analysts, has argued that “Statistics Canada’s efforts to track food price inflation data may require a rethink,” raising concerns over the validity of much of Statistics Canada’s data in the wake of Canadians’ tightening food budgets and low fixed incomes. Morrison also states that container sizes are not being accurately reflected in some cases, which means that the amount of food for the price may be shrinking. Morrison claims that her company is able to track real-world food prices “more comprehensively than Statistics Canada to help grocers make what it calls ‘data-driven decisions in real time.’” Statistics Canada relies on data from three chains it “partners” with but the names of which have not been disclosed due to “corporate confidentiality,” according to Heidi Ertl, director of consumer prices at Statistics Canada.

European Corn Risks Being Left in Fields as Gas Crunch Bites

27/10/2021

Topic: Gas shortages may risk European corn crops

French corn farmers are being told by gas suppliers to prepare for shortages, to use less of the fuel, and even to postpone collection if possible, while in Ukraine, increased energy prices have meant a slower harvest to offset expenses. However, if harvested too late, this puts European corn at risk of deteriorating crop quality and reduces farmer incomes. As of October, Ukraine has harvested about a third of its corn, while France has harvested about 32 percent.

Compiled 25/11/2021

Farmers devastated by B.C. floods return to gut-wrenching scenes

25/11/2021

Topic: Farmers face devastation after BC floods

After heavy rains beginning on November 14, 2021 led to massive flooding across British Columbia, farmers were and continue to be faced with “an agricultural disaster.” In the Fraser Valley, multigenerational farmers “watched their family businesses go under, along with their homes, have also been left to deal with catastrophic mortality and biohazard risks from animals caught in the flood.” BC is currently working with Ottawa to develop an agricultural recovery program.

Farmers’ anti-trust suits against Big Ag seek $1 billion, injunction so FBN can sell online

19/01/2021

Topic: Farmers’ anti-trust suits against Big Ag seek $1 billion

At the US district court, two antitrust suits would void contracts throughout North America in order for San Carlos, California-basd Farmers Business Network (FBN) to sell chemicals and seeds online. It is claimed by the plaintiffs that the ag defendants keep prices high by restricting access to the network. The first complaint for the estate of Jefferson County farmer Michael Piper was filed by Attorneys George Zelcs of Stephen Tillery’s firm on January 8. Zelcs “proposes to certify a class of all persons who bought a crop input manufactured by a defendant from a defendant since 2014. . . [and] proposes to certify a class of all persons who bought a crop input manufactured by a defendant from a retailer other than a defendant.” BASF, Bayer, Corteva, and Syngenta were named as manufacturer defendants, with the suit alleging that they controlled production of 85 percent of the seed market, more than 90 percent of cotton, and more than 75 percent of soybeans. Cargill, Univar Solutions, and Winfield United were named as wholesalers which accounts for 70 percent of sales volume, according to the suit. CHS, Farm Supply, Federated Cooperatives, Nutrien Ag Solutions, Simplot, and Tenkoz were named as retailers, with the suit claiming that the manufacturers only allowed authorised retailers to sell crop units. The suit also claims that more than 12,000 farmers signed up with FBN for objective performance data and 6,000 signed up for a platform designed to sell crop units online. Moreover, Zelcs states that in 2016, CHS “sent farmers a letter attempting to discourage them from using FBN,” while in 2018 the network purchased Yorkton Distributors to neutralise the “boycott” initiated by Syngentia, which initiated an audit to identify and punish retailers who made sales of branded inputs. Manufacturers that supplied crop units to Yorkton were then allegedly threatened with retaliation by wholesalers and retailers; as a result, manufacturers agreed to boycott Yorkton. The network began to develop products it can sell to farmers from its electronic platform in an attempt to address the lack of input. Zelcs writes that Canada’s bureau of competition is investigating defendants, and Zelcs asks for a permanent injunction and triple damages of $999 million under the Clayton Act.

Compiled 07/01/2022

Warm, Dry Conditions Threaten U.S. Plain Winter Wheat Belt The Crop Goes Dormant Over The Winter

20/12/2021

Topic: US Plains’ winter wheat yield prospects threatened by warm, dry conditions

As global supplies of milling wheat tighten, the US Plain’s winter wheat yield prospects have been threatened by dry and unseasonably warm weather conditions. The Department of Agriculture estimates that when the 2021-2022 crop year ends, world wheat ending stocks will be the smallest in five years. In late December, the US Drought Monitor demonstrated that 46 percent of Kansas was abnormally dry and that 6 percent of the state was in severe drought. In other key wheat states, including Colorado and Oklahoma, conditions were worse, with Colorado sitting at 68 percent in severe drought and Oklahoma at 29 percent in severe drought. Meanwhile, warm temperatures have accelerated the evaporation of moisture from soils, with 111 maximum temperature records being broken in Kansas between November 25 and December 4, states Kansas State University meteorologists. 

Record Brazilian Soybean Crop Pressures Prices

29/12/2021

Topic: The collapse of the grain market in 2021

Al Kluis documents the collapse of the grain market in 2021. Beginning with soybean prices being driven from over $16 a bushel to below $12 a bushel, Kluis states that there are three reasons behind this drop. One, large corn and soybean crop yields in 2021 resulted in larger than expected production, with US farmers striking a record corn yield and one of the highest soybean yields ever despite the dry, hot summer conditions. Two, China’s record corn crop, large wheat crop, and large drop in hog numbers meant that there was a reduction in Chinese demand for soybean and corn imports from the US. Three, Brazilian farmers planted at a near-record pace, thus there is the potential for large soybean and corn crops in Brazil this year, with the potential to produce 800 million more bushels of soybeans than the US if favourable weather conditions continue. Moving on, Kluis points out three market signals that may indicate that soybean and corn prices have bottomed or are heading higher. One, basis levels improved and the bull spreads started to work when the soybean and corn markets turned higher in the first 2021 quarter, leading both markets to switch from a carrying charge market to an inverted market. This signalled both a major trend change and a bull market, though as of December 2021, the markets were in a carrying charge mode. A sustained rally will be challenging to forecast until this changes. Two, if prices stabilise and move into a sideways trading channel, then this sets up a base that can launch the next uptrend. Kluis anticipates that prices will turn higher by late 2022. Three, the first monthly close above the two previous months’ high should be considered. Ultimately, Kluis argues that the possibility of soybeans returning to over $15 a bushel in 2022 is not impossible but is unlikely, as “the current change in global fundamentals suggests global soybean stocks are expanding.” In terms of weather, Kluis argues that if the central US or Brazil develop weather problems in 2022, he “can target a rally back to $13 to $13.80. If that bullish weather pattern develops, then you will read a lot of wild price forecasts calling for $15 (or even $18) soybeans.” Kluis recommends selling the last of 2021 soybeans on any rally into early May, as this strategy worked well in 2021 and should work well again in 2022. 

Uk farmers braced for spring fertiliser crunch after prices triple

02/01/2022

Topic: UK farmers prepare for spring fertiliser crunch

After fertiliser prices almost tripled and supplies were cut, UK farmers are preparing for a fertiliser crunch in spring. The reduced use of crop nutrients are expected to affect the productivity of vegetable, dairy, livestock, and some arable farmers. Ammonium nitrate fertiliser, the main product used to boost crop growth, saw increased costs due to surging natural gas prices and temporary closures of UK manufacturing plants. Though farmers have cut back on chemical fertilisers to reduce their environmental footprint, ammonium nitrate and alternatives such as urea remain crucial to most arable, vegetable, dairy, and livestock farmers, who use the product to grow grass for their animals. According to The Andersons Centre, a farming consultancy, spot prices for standard ammonium nitrate fertiliser stood at £213 a tonne in October 2020 and £615 a tonne in December 2021. Urea, phosphate, and potash fertiliser prices almost doubled over the same period. While surging wheat prices will compensate some arable farmers for the increasing cost of fertiliser, this also depends on the timing of fertiliser orders, says Michael Haverty, a partner at The Andersons Centre. According to Jo Gilbertson, head of fertilisers at the Agricultural Industries Confederation, the UK imports 60 percent of its fertiliser requirement. The US group CF Industries, which is the only producer of ammonium nitrate in the UK, shuttered its two plants in September as a result of natural gas price rises making them unviable. Though one plant at Billingham was reopened with government funding to enable carbon dioxide production, CF’s agreement with the UK government ends in January. The second plant in Ince has not yet been reopened.

Inflation tests pricing power of global brands

01/05/2021

Topic: Global brands seek to offset record rises in input costs, risking shares

Global brands such as Nestlé, Procter & Gamble, and Unilever are planning for price rises in their latest market updates amidst high commodity price inflation and an uptick in transport and packaging costs. Many global brands have noted that while they had raised prices in the first quarter, much of the cost increases “had yet to pass through to consumers’ shopping baskets.” As is, raw material prices have reached record highs due to the impact of the COVID-19 pandemic on labour and logistics, bad weather, and countries such as China bulking up their inventories. For example, in Europe, milk prices have risen about 50 percent since the start of 2021. Commodity market tightness “is expected to continue through 2021,” with Richard Cook, head of the analytics product team at NielsenIQ, noting that “essential categories” such as bread, cheese, eggs, and wheat would easily be able to increase prices. Cook also noted that premium products that serve specific needs such as skin tanning lotions and vegan products may also bear increases, while Bruno Monteyne, a Bernstein analyst, argued that “weaker” portfolios like dairy products and Danone’s bottled water business “could be vulnerable to losing market share if prices are increased too quickly.” Different companies intend to take different approaches to navigating these price hikes; however, the response of households to these hikes may be affected by the unequal impact of the pandemic. Will Hayllar, a global managing partner at strategy consultants OC&C, explained that “the last real wave of commodity inflation was in 2012, and that added to price sensitivity in the marketplace . . . [but] this time there is a segment of consumers for whom there is pent-up spending power.”

Grains-Corn hits 8-year high as dry weather in Brazil raises supply concerns

04/05/2021

Topic: Dry weather in Brazil raises supply concerns, grains and corn futures hit 8-year high

Dry weather in Brazil and subsequent concerns about global supplies led to Chicago corn futures rising for a third consecutive session in the first week of May of 2021—hitting their highest since March 2013. Soybeans rose for a second straight session, while wheat extended gains. Safras & Mercado reported that Brazil’s 2020/2021 total corn crop estimate lowered by almost 8% to 104.1 million tonnes due to dry weather impacting Brazils second corn plantings yields.

Argentine firms ink deal to produce genetically modified wheat-based foods

11/05/2021

Topic: Argentine firms sign deal to produce genetically modified wheat-based foods

In a joint statement in May 2021, two Argentine firms—Argentine biotech company Bioceres and local food company Havanna—announced that they had signed a deal to produce food based on genetically modified HB4 wheat. HB4 wheat is drought-resistant and has received interest for its potential to increase wheat production, with Argentina already gaining its title as the world’s top exporter of soymeal livestock feed in large part due to being a producer of genetically modified soybeans. However, some scientists are concerned as to whether the herbicide used with HB4 is safe for consumers and the environment. To this, the companies announced that “the food products will be made under the Havanna brand and will offer the highest level of information to the consumer regarding the origin of the wheat, the environmental footprint generated.” The Argentine government gave approval to farmers to produce HB4 wheat in 2020.

Ag-tech plants seeds of hope as Canada farm outlook brightens

12/05/2021

Topic: Farm outlook in Canada in 2021 grows positive

Canadian farmers are growing hopeful about 2021. The possible end of the pandemic approaching in addition to stronger commodity prices and new ag-tech—such as GPS livestock collars and agriculture data tools—have brightened the outlook after recent years of hardship. In the past few years, farmer mental health and wellness has reached high levels of stress and exhaustion as a result of income pressures, bad weather, the pandemic, tense China-Canada and China-US relations, and debt (the agriculture sector was $115 billion in debt in 2019 according to Statistics Canada). However, government forecasts anticipate that total net income on Canadian farms rose by 22 percent in 2020 to $16.5 billion as a result of strong growth in oilseeds and grain, and in 2021 people in the industry continue to rally against the odds. That being said, according to Jon Driedger, an analyst with LeftField Commodity Research, “lasting prosperity will depend on new technologies.” Groups such as Winnipeg-based Farmers Edge (which collects and analyses farm data to help boost crop yields and sales) have taken on the innovation game. However, innovation still necessitates government assistance. 

China’s record soybean demand forecast to support prices till 2022: sources

14/05/2021

Topic: China’s record soybean demand forecasted to support prices until 2022

According to market sources speaking with S&P Global Platts on May 13, China’s high demand forecast for soybeans will most likely boost international soybean prices until at least 2022. China’s soybean imports forecast for the 2020/2021 marketing year was revised up 2 million megatonnes to a record high 100.4 million megatonnes, the Chinese Supply and Demand Estimates report noted. The same report said that the 2021/2022 demand was projected at a colossal 102 million megatonnes. US soybean futures prices for nearby shipments rose over 90 percent on the year to a nine-year high of $16.3538 per bushel, while Brazilian domestic prices reached all-time high levels of Real 161/60 kilograms in April, which is up 85.5 percent on the year. In the first four months of 2021, China imported 28.63 million tonnes of soybeans, up 17 percent from the same period last year. As of May 2021, in the current marketing year, US soybean inspection for exports are estimated at 55.7 million megatonnes (compared to 34 million megatonnes last year), with majority volumes headed for China. In Brazil, the country’s foreign trade department reported that Brazil has shipped 33 million megatonnes of soybeans between January and April, up 3.5 percent year on year, with China accounting for 73 percent of those shipments so far in 2021. Additionally, demand for soybean-based animal feed has risen in 2021. After the devastating impact of the African swine fever epidemic in China between 2018 and 2020, China’s swine herd is expected to cross 440 million heads by the end of 2021 (compared to 406 million in 2020). Since late 2019, China’s pig farming sector has experienced rapid consolidation, with small-scale farms amalgamating into large entities under a government directive and supported by over $30 billion invested into the consolidation. 

Russia wheat output expected to fall in 2021-22

17/05/2021

Topic: Russia’s wheat output forecast to decline by 9 percent in 2021/2022

According to a May 13 Global Agricultural Information Network report from the US Department of Agriculture (USDA), Russia’s wheat production for the 2021/2022 marketing year is forecast to decline by 9 percent (to 77.5 million tonnes) due to poor weather in recent months reducing yield prospects. This drop in output is projected to offset increases in barley and corn production of 7 percent and 6 percent, respectively. The USDA forecasts Russia’s total grain production to decline by 5 percent (to 118 million tonnes) in 2021/2022. The report also noted that in 2021 and in following years, intensified government regulation in the Russian Federation will significantly impact pricing and overall regulation of the agricultural sector. In December 2020, to address sharply increased domestic prices, the Russian government introduced an export quota of 17.5 million tonnes of grain from 15 February to 30 June of 2021. The USDA projects total grain export volume to reach 48 million tonnes in 2021/2022, including 40 million tonnes of wheat exports.

US West Coast imports exceed 1m TEU in nine out of ten past months

20/05/2021

Topic: US West Coast imports reach 1.10m TEU

West Coast loaded imports amounted to 1.10 million TEU as the surge in US container imports continued in April 2021. Imports never exceeded this level until August 2020, with developments between August and April meaning that April imports were only the sixth highest on record. In the first four months of 2021, volumes were up by 40.3 percent, representing an increase of 1.2 million TEU from the same period in 2020 (volumes are still up by 22.8 percent compared to 2019). These record-high US West Coast imports made March the busiest month recorded for global container shipping, with 15.5 million TEU being exported globally.

Australia’s top beef exporter predicts tenfold UK sales surge on trade deal

20/05/2021

Topic: Australia-UK zero tariff, zero quota trade deal predicts tenfold UK sales surge

The Australian Agricultural Company, Australia’s largest beef exporter, predicted it could boost UK sales tenfold if UK Prime Minister Boris Johnson backs a zero tariff, zero quota trade deal. However, cabinet ministers clashed over the deal regarding its likely impact on British farmers, with cabinet ministers such as environment secretary George Eustice arguing that “any deal must include strong protection for UK farmers.” Eustice feared that total tariff liberalisation “would set a precedent for future trade deals, including with the US,” with Eustice arguing that only a certain quota of Australian imports should be tariff-free in order to avoid the risk of a surge in low-cost imports. According to a July 2020 study of the prospective deal, a “full tariff liberalisation” deal would result in British exports to Australia to rise to 7.3 percent, but it would also provoke an 83.2 percent rise in Australian exports to the UK. The study noted that while most of the UK would benefit from the trade deal—even suggesting that national GDP might rise by 0.02 percent—Northern Ireland would be left up to 0.25 percent worse off due to its large farming sector. Under the current trading regime, Australian beef exporters face a blanket 12 percent tariff on beef products and an annual lower tariff quota of 3,761 tonnes. Moreover, the UK Government is under pressure from environmental groups such as Green Alliance, WWF, and Sustain. These groups argue that the UK-Australia trade deal “would see the UK ‘aligning with laggards on climate’ and force UK farmers to compete with more environmentally destructive farming methods,” with WWF pointing out that Australia has high deforestation rates linked to livestock farming.

Canadian wheat market to tighten in 2021-22

21/05/2021

Topic: Canadian wheat market expected to tighten in 2021/2022

The Agriculture and Agri-Food Canada ministry noted that in the 2021/2022 marketing year, Canada’s wheat market output is anticipated to fall to 31.06 million tonnes from the 32.75 million tonnes forecast in April and the 35.19 million tonnes forecast for the 2020/2021 year. This lower forecast comes as seeded areas for wheat were revised down to 9.41 million hectares for next year from 9.93 million hectares in April and 10.19 million hectares seeded this year. Canadian farmers are expected to partially switch to canola and corn, with both crops seeing a stronger price rally compared with wheat in 2021. However, strong Canadian wheat exports for 2021—which is now projected at 26.75 million tonnes—imply that stocks by the end of this marketing year could be as low as 4.75 million tonnes, which is revised down from 5.31 million tonnes in April.

Tractor Hacking: The Farmers Breaking Big Tech’s Repair Monopoly

01/02/2018

Topic: Nebraska Farmers “Hack” Equipment Repairs

Motherboard (VICE) reveals how the modernization of tractors and other farm equipment has led to large manufacturers like John Deere holding monopoly over the diagnostic software necessary for repairs. Motherboard interviews several Nebraska farmers and mechanics who are at the forefront of this “right to repair.”

Canadian barley growers exploiting Australia’s troubles with China expose a vulnerability in any democratic alliance against Beijing

01/06/2021

Topic: Canadian barley growers take advantage of Australia-China conflict

After Beijing put up tariff walls to block imports of Australian barley, Canadian barley farmers took advantage of the situation, resulting in record cash receipts of approximately $1.1 billion (a 14 percent increase from 2019) and the second time barley fetched more than $1 billion in a single calendar year, according to Statistics Canada. Canada’s barley exports to China rose by 18.5 percent in 2020, with shipments in the first quarter of 2021 reaching more than $290 million (an increase of 175 percent from the same period in 2020). 

Global food prices post biggest jump in decade

03/06/2021

Topic: Global food prices surge by the biggest margin in a decade

As commodity prices surged, a closely monitored global food price index in the UN Food and Agriculture Organization (FAO) jumped 40 percent in May, the largest jump since 2011. Many fear that the inflation first prompted by pandemic disruption is accelerating. This higher inflation will hit poorer countries that rely on imports for staple goods, while in wealthier countries the rise in raw material prices is such that big companies such as Nestlé and Coca-Cola have said that they would “pass on any increases.” Additionally, transport, shipping, and labour costs are expected to push prices higher in the coming months. According to the FAO, the world’s consumer price inflation for food already jumped 6.3 percent in 2020 (up from 4.6 percent in 2019) as a result of the pandemic wreaking havoc on global supply chains, thereby impacting the production and distribution of food.

BHP approaches final decision on Canadian potash project

01/06/2021

Topic: BHP Group to make a final decision on Jansen mine

BHP Group is preparing to make a final decision on Jansen, a large potash project in Canada that could cost as much as $5.7 billion to complete. BHP has opened talks with a Canadian rival, Nutrien, “about a potential partnership that could help make the project less risky and provide critical infrastructure.” Fertilisers will play a key role in increasing crop yields to meet growing food demands, with Scotiobank forecasting that the potash market will grow at approximately 2 million tonnes a year between 2022 and 2030. BHP has already spent more than $4 billion on sinking two 1-kilometre shafts at the Saskatchewan site but between $5.3 billion and $5.7 billion is needed to bring the mine into production. Jansen would be BHP’s biggest investment if the decision were approved. 

China’s import appetite raises prospects in US farm belt

07/06/2021

Topic: Record shipments and high crop prices boost prospects in US farm belt

Rising exports and food prices have fueled a recovery in the US agricultural economy after former US President Donald Trump’s trade war with China left many American farmers dependent on government subsidies. The US Department of Agriculture anticipates that the US will ship a record $37.2 billion worth of farm goods to China in 2021, with the sum being 23 percent of total US agricultural exports estimated at $164 billion. Increased demand from China in addition to supply constraints on corn and soybeans as a result of a drought in Brazil has resulted in a surge in global food prices, which have given a further boost to American farmers’ prospects. Although soybeans were the US’s biggest agricultural export to China, China has now taken interest in US corn, with 23.2 million tonnes either shipped or booked for the marketing year ending in August (compared with less than 200,000 tonnes five years ago). Despite an early growing season in the US, forecasters this year anticipate healthy crops, with soybeans selling for more than $15 per bushel and corn above $6 per bushel. 

Worst drought in a century hits Brazil as it fights to overcome Covid

19/06/2021

Topic: Worst drought in a century hits Brazil amongst Covid struggles

Many Brazilians face water shortages and the risk of power blackouts as a result of the worst drought in almost a century, complicating Brazil’s efforts to recover from the pandemic. The drought has had a devastating effect on the country’s farming industry, which accounts for about 30 percent of Brazil’s GDP. As consumer prices increase more than 8 percent in the year to May, inflation “has combined with high levels of unemployment to hit the nation’s poorest citizens.”

Good UK trade policy should start at home

15/06/2021

Topic: Opinion piece on the importance of domestic by-in to agreements

The Financial Times’ Editorial Board discusses how the trade deal agreed in principle between Britain and Australia, the provisions of which will “set a framework for other trade talks, showing what the UK is willing to give away to achieve its goals. Just as important, however, is the unfortunate precedent it sets in how the country’s trade policy is managed.” The Editorial Board notes how “there has been little parliamentary scrutiny” of the Australian trade agreement, with “the most controversial aspect” being the trade agreement’s impact on British farmers, who fear facing price and standards competition from industrial-scale Australian producers in addition to being asked to absorb the costs of “the green transition.” In response to the Scottish National Party’s interest in scaremongering over the deal’s impact on Scottish farmers and the Northern Irish protocol meaning that any trade agreements will not fully apply to the province, the Editorial Board calls for “a balance to be struck,” where “negotiations require a country to present a united front and speak with one voice.”

Biden launches assault on monopolies

08/07/2021

Topic: Biden launches executive order to reduce monopolies’ hold on major industries

US President Joe Biden announced a sweeping executive order intended to promote competition throughout the US economy as part of both the country’s economic recovery from the pandemic and a larger attempt to reduce the stronghold of monopolies and concentrated markets in major industries. Other elements of the order are designed to lower the price of prescription drugs, increase scrutiny of abusive business tactics in the tech industry, and protect consumers’ privacy. The impact of the order could be felt in industries such as agriculture, banking, and health, such as the order’s inclusion of the initiative to guarantee farmers and motorists the right to repair their own vehicles without voiding warranty protections. Moreover, top White House officials noted that the order also “seeks to ensure small businesses and consumers have access to fair markets.”

Why processing beans, peas and lentils could solve Canada’s “commodity conundrum”

09/08/2021

Topic: Interest in plant-based protein an opportunity to build Canadian food-processing into a global powerhouse

Historically, Canada’s ability to grow crops has outmatched its ability to process those crops into higher-value consumer goods. However, federal cabinet ministers, food processors, and industry advocates see increasing interest in plant-based proteins, which are made from pulses, as an opportunity to build the Canadian food-processing sector into a global powerhouse. Homegrown processors could capture 10 percent of the $250 billion plant-based products market (compared with the 3.3 percent Canadian processors currently have). This opportunity also comes at a time when a dependence on exporting processed, packaged goods during times of crisis poses a problem. However, to increase production of pulses to meet this new demand for plant proteins, a major wave of private-sector investment, regulatory reform, and infrastructure development is needed. According to Protein Industries Canada, in the next decade, Canada will need to process an additional 6 or 7 million tonnes to have a shot at that 10 percent of the plant-based products market.

Canada’s farmers brace for new heat wave as scorching summer leaves cherries roasting in trees

17/07/2021

Topic: Devastating Canadian heat waves leading to crops baking in fields

A series of heatwaves in Canada have led to numerous crops quite literally baking in fields. While farmers have been planning “for slow, constant climate change,” farmers could not have predicted 2021’s immense spike in summer temperatures. The heat has also challenged other factors of farm life, such as reducing the amount of time labourers can work in the fields. Many livestock farmers are turning to grain growers to consider using some of their unsellable yield as feed, with Saskatchewan recently changing its crop insurance regulations to ensure just that. The threat of wildfires has also grown. Agriculture and Agri-Food Minister Marie-Claude Bibeau has promised to leverage government programs to support those producers affected by extreme weather and droughts, such as through the AgriStability program, which operates like an income insurance program. Bibeau has also been encouraging provinces to trigger the agricultural sector’s disaster relief program.

Extreme heat and drought in Western Canada wreak havoc on food system

16/07/2021

Topic: Extreme weather and drought in Western Canada wreak havoc on food system

Weeks of devastating heat, drought, and wildfires in Western Canada have led to massive disruptions to food production in Canada. Stunted crops, fruit baking on trees, and an 80 percent mortality rate at some commercial shellfish operations are only some of the issues such extreme weather and climate disasters have caused, thousands of dollars in loss notwithstanding. 

Op-Ed: Feeling the drought on my family farm

19/07/2021

Topic: Opinion piece on impact of drought on farmer’s family farm

David Mas Masumoto recounts his difficulties farming during the severe two-year drought drying out the West and Southwest in the US, citing concerns over water scarcity, price inflation in grocery stores, and climate change. Ultimately, Masumoto argues that “we must re-envision water as something scarce and sacred and shared by all.”

Wheat posts biggest weekly climb in 6 years on weather woes

19/07/2021

Topic: Chicago wheat futures reaches highest weekly climb in six years following weather troubles

In July, Chicago wheat futures rose about 3 percent, recording their largest weekly gain in six years amidst concerns about global supplies. These concerns have been prompted by dry conditions for North American spring wheat and adverse weather in Europe and Russia leading to sub-par yields in the key southern export region. Soybean futures ended higher on uncertainty about US crop weather, while corn futures declined.

Russian wheat prices up on worsening crop outlook

03/08/2021

Topic: Increase in Russian wheat prices due to worsening crop outlook

Due to a worsening outlook for Russian wheat and stronger markets in Chicago and Paris, Russian wheat prices rose in the last week of July. Sovecon, an agriculture consultancy, recorded a $10 rise to $255 per tonne of wheat, while barley was up $10 at $244. IKAR, another agriculture consultancy, cut its forecast for Russia’s 2021 wheat crop by 3 million tonnes to 78.5 million tonnes due to low yields in the Central and Volga regions. Sovecon noted that it could cut its forecast by 4 million tonnes from 82.3 million tonnes of wheat as a result of Russia’s statistics service reporting the pre-harvest winter wheat area at 15.6 million hectares last week versus the 16.8 million hectares that Sovecon previously estimated.

Why right to repair matters – according to a farmer, a medical worker, a computer store owner

02/08/2021

Topic: The importance of Biden’s executive order prioritising consumers’ “right to repair”

Many in the agriculture, technology, and health industries are hopeful for the changes Joe Biden’s executive order will bring, particularly in regard to the order’s prioritization of consumers’ “right to repair” their own devices (and thus outside of the stranglehold of manufacturers). The Guardian interviews a farmer, a nonprofit repair store, a medical worker, and a computer store owner to share their frustrations and hopes with right to repair laws.

Young farmers lose hope as drought closes in: “It’s like a sad country song”

05/08/2021

Topic: Young American farmers lose hope as drought impacts Western US

The Guardian interviews young farmers of the Klamath Basin, an agricultural community on the border of Oregon and California, who “fear they might be the last generation of their kind” as a result of increased water scarcity due to the historic drought infiltrating the area. In May, the federal government cut off all irrigation to farmers to conserve water for the endangered fish sharing the landscape, which sparked concern among farmers. The Guardian notes that hotter temperatures have resulted in snowpack being low in winter, rainfall being sparse in spring, and forest fires more prevalent and dangerous. Moreover, what was once a string of wetlands is now a completely transformed system of farmlands as a result of 19th-century agrarian efforts. Many young farmers in the Basin have encountered increased costs associated with pumping water, compounding other costs such as mortgages, land leases, and labour costs. 

As their numbers dwindle and voice becomes fractured, those in ag need to show what’s good for them is good for others

07/08/2021

Topic: Opinion piece on farm support programs

In her opinion piece, Laura Rance discusses the role and future of farm support programs in Canada. She notes how the Canadian Agricultural Policy Institute has turned to agricultural economist Douglas Hedley “to analyze where Canadian farm policy has come from and where it might need to go.” Hedley notes that “policy approaches need to be nimble, able to respond rapidly to events domestically and internationally, and founded on an improved and strengthened relationship with provinces and territories.” However, Rance emphasises that farmers “will be looking for policy solutions they can take to the bank out of these consultations,” while Hedley emphasises that “the focus needs first to be on sound processes for decision making.”

CFA Applauds Federal and Alberta Governments Commitments to Drought Relief

09/08/2021

Topic: CFA applauds federal and Alberta governments’ commitments to drought relief in Canada

In a 9 August 2021 announcement, the Canadian Federation of Agriculture (CFA) applauded the federal government’s decision to earmark $100 million for drought relief through AgriRecovery and the Alberta government’s announcement of $136 million for Alberta livestock ranchers impacted by drought. The latter also included a request for an additional $203 million from the federal government for a total relief package of $339 million for Alberta farmers. The CFA has called for the Manitoba, BC, Ontario, and Saskatchewan governments to follow Alberta’s lead and to “develop AgriRecovery assistance packages for the affected producers in those provinces as well.”

https://apple.news/APus3XvK8S26MAHTygHGTvw

07/04/2021

Topic: Rates of Parkinson’s disease are exploding. A common chemical may be to blame.

Researchers believe a factor is a chemical used in drycleaning and household products, such as shoe polishes and carpet cleaners in the U.S.  When asked about the future of Parkinson’s disease in the U.S., Dr Ray Dorsey says, “we’re on the tip of an iceberg.” Dorsey, a neurologist at the University of Rochester Medical Center and author of “Ending Parkinson’s disease, believes a Parkinson’s epidemic is on the horizon. Parkinson’s is already the fastest growing neurological disorder in the world; in the U.S. the number of people with Parkinson’s has increased 35% over the last 10 years, says Dorsey, and “We think over the next 25 years it will double again,”

https://news.sky.com/story/cowcredits-firm-behind-low-methane-cattle-feed-launches-co2-offsetting-scheme-12275760

19/04/2021

Topic: CowCredits: Firm behind low methane cattle feed launches CO2 offsetting scheme

A British-Swiss firm behind cattle food which reduces a cow’s methane emissions by 30% has begun selling carbon credits to allow companies to offset their CO2 footprint. Mootral has developed the special feed at their laboratories in Abertillery in the Welsh Valleys. It works by using an extract of garlic in a special formulated food supplement for cattle, which removes microorganisms in a cow’s stomach that create methane. Now the firm wants companies and individuals to offset their carbon footprint by purchasing so-called “CowCredits” for around £60 – equivalent to one tonne of CO2.

https://www.hellenicshippingnews.com/grains-corn-hits-8-year-high-as-dry-weather-in-brazil-raises-supply-concerns/

05/04/2021

Topic: Grains-corn hits 8 year high as dry weather in Brazil raises supply concerns.

Chicago corn futures rose for a third consecutive session on Monday to hit their highest since March 2013 as dry weather in Brazil raised concerns about global supplies.

Wheat extended gains, while soybeans rose for a second straight session.

“There are big issues for Brazil’s corn crop which is suffering due to lack of rains,” a Singapore-based feed grains trader said. “Wheat is tracking gains in corn as it is used as a substitute for corn in animal feed.”

https://www.hellenicshippingnews.com/fao-food-price-index-rises-for-ninth-consecutive-month-in-february/

04/03/2021

Topic: FAO Food Price Index rises for ninth consecutive month in February

Global food commodity prices rose for the ninth consecutive month in February, with quotations for sugar and vegetable oils increasing the most, the Food and Agriculture Organization of the United Nations (FAO) reports today. The FAO Food Price Index, which tracks monthly changes in the international prices of commonly-traded food commodities, averaged 116.0 points in February, 2.4 percent higher than the previous month and up 26.5 percent from a year ago.

08/03/21

Topic: U.S. dominance in global grain markets has faded despite robust exports

The United States for many decades had been known as the world’s breadbasket, leading the way in corn, soybean and wheat exports. But although trade volumes remain historically high, the country’s relative impact on global exports is smaller than ever. High grain and oilseed prices, increasing global demand and weaker currencies have all contributed to the decline in U.S. export dominance. In recent years, U.S. crop shortfalls between 2010 and 2012 permanently reduced the country’s market share and contributed to the rise of competing producers. Today, the United States exports just over a quarter of the world’s corn, wheat and soybeans, compared with more than half some 30 years ago. The country also grows about a quarter of those global crops, a smaller portion than in previous decades, though the decline is much less extreme versus that of exports.

10/03/2021

Topic: Roaring grain demand top concern, supply curbs take backseat: FAO economist.

The global grains market, which saw a price rally across all major commodities in 2020 following an unprecedented supply-demand scenario, is more likely to be driven by the insatiable hunger of key grain buyers in future while supply restrictions become less relevant, Abdolreza Abbassian, senior economist at the Food and Agriculture Organization, told S&P Global Platts in an interview. “I’m not so concerned at this point in time with issues on the supply side, my biggest concern actually now is on the demand side. Grain demand is surprising us in certain aspects,” Abbassian said.

http://www.bbc.com/storyworks/future/the-technology-transforming-agriculture/how-technology-is-transforming-japans-agriculture?utm_source=BBC-news&utm_medium=Elsewhere&utm_campaign=jp-agritech&utm_content=Article01

24/12/2020

Topic: How technology is transforming Japans’ agriculture.

Japan’s manufacturing sector is renowned for cutting-edge techniques based on the philosophy of continuous improvement. In contrast, the nation’s agricultural sector is characterised by an ageing workforce that relies heavily on time-honoured practices. Now, however, industrial technology is helping modernise Japan’s agriculture sector and increase exports. In 2019, Japan’s combined annual exports of agricultural, forestry and fisheries products and food were JP¥912.1 billion (US$8.79 billion), marking a record high for the seventh consecutive year. Yet Japan’s agricultural industry has even greater ambitions, with plans to reach export targets of JP¥2 trillion by 2025 (US$19.28 billion), and JP¥5 trillion (US$48.21 billion) by 2030. While these figures are impressive, conventional Japanese farming techniques are presently labour-intensive and the average age of farmworkers is almost 67.

https://apple.news/AWnKIJT4ZSe2_TX2_AJPucA

12/03/2021

Topic: ADM to Pay $45 Million to Settle Peanut Farmers’ Price-Fixing Claims

Agricultural company Archer Daniels Midland Co. said it would pay $45 million to settle price-fixing allegations leveled at its peanut-processing division. The settlement by the Chicago-based company aims to resolve a civil lawsuit filed by nearly 12,000 U.S. peanut farmers, who accused the nation’s top peanut processors of colluding to hold down prices paid to growers. Farmers alleged that ADM’s Golden Peanut division coordinated with two other processors to report faulty supply and pricing data, keeping prices for farmers low for the past six years.

https://apple.news/A7Az4YhgEQeOa6j29XXoJ0w

15/03/2021

Topic: Watch Out: China Cannot Feed Itself (Opinion)Consider U.S. farmers happy.

They are exporting record volumes of products to China. Shipments of soybeans, corn and pork are bringing smiles back to the American heartland. Or, to put this another way, Beijing is effectively acknowledging it cannot feed the Chinese people. China’s leader, Xi Jinping, recently made such an admission. Last August, he announced what became known as the “clean your plate” campaign to end what he called a “shocking and distressing” waste of food. Just about everyone saw this effort, to get the Chinese people to eat less, as a warning of food shortages to come.

https://bayer.ft.com/farmings-grand-challenge

Topic: Farmings’ grand challenge, how to feed the world sustainably.

It is hard to understate the challenges the world faces. Emerging from the throes of the pandemic, global governments must grapple with a climate crisis whose signs are everywhere marked by weather extremes, be it floods, heatwaves or hurricanes. At the centre of this mega-challenge: global agriculture. Faced with the devastating effects of climate change, the industry will need to transform in order to produce sufficient healthy, diverse and safe food for a rapidly growing world population; and it must address its own impact on the environment – more than one-quarter of the world’s greenhouse gas emissions come from agriculture, forestry, and land-use change. At the same time, caloric demand is expected to increase by 70 per cent by 2050, while it is feared that the water supply could fall 40 per cent short of meeting global water needs by 2030. So what can be done to produce more under changing conditions and with less impact on the environment?

Commodities 2021: US corn prices seen firm on global demand recovery

04/01/2021

Topic: Firm US corn prices following global demand recovery

After undergoing a volatile 2020, the US corn balance sheet ended the year at an over six-year high, with the most active March futures contract of corn on the Chicago Board of Trade reaching $4.80 per bushel on 31 December—increasing more than 40 percent since August. Additionally, the US Department of Agriculture’s season average farm price for US reached $4 per bushel, rising 30 percent since August. The primary contributing factor to these high prices was unexpectedly high demand from China, with export sales for US corn in 2020-2021 up by 162 percent year-on-year from 2019. The USDA anticipates that China is likely to import 16.5 million megatonnes of corn in 2020-2021, a steep increase compared to the estimated 7.6 million megatonnes in 2019-2020. Sustained strong demand of US corn from China could resume in 2021, as China has already committed to 11.6 million megatonnes of US corn for delivery in 2020-2021 as of 16 December, while the recovery in China’s hog herd—previously hit by Asian Swine Fever—and speculation around “tight inventories” could also be contributing factors to this sustained demand. Other factors contributing to firm corn prices include substantial cuts to production estimates (global corn production estimates for 2020-2021 have dropped by 3.5 percent since May to 1.143 billion megatonnes in December), dwindling supplies of corn from major producers (the US, the EU, and Ukraine) due to dry conditions, suspension of corn exports in Argentina until March 2021, potential competition with a strong soybean market (which saw a price recovery in 2020), and potential increased demand for corn ethanol (dependent on successful COVID-19 vaccines encouraging a global economic recovery). Additionally, the demand outlook for US Dried Distillers Grain with Solubles (DDGS) is likely to be supported into 2021 on continued buying.

Commodities 2021: Soybean crush outlook diverges on recovery in Brazil, recession in Argentina

05/01/2021

Topic: Soybean crush outlook diverges on recovery in Brazil, recession in Argentina

Brazil’s soybean crush volumes are expected to remain elevated in 2021 on high demand, whereas the outlook for Argentina’s crushing industry is uncertain while Buenos Aires navigates with recession and more than $323 billion of debt. High domestic and export demand meant that Brazilian crushers’ sales rapidly increased for most of 2020, Argentina’s crushers dealt with labour strikes, tight raw beans supply, logistical bottlenecks, high taxes, and negative margins, with analysts predicting similar trends for Brazil and Argentina in 2021. A Rosario-based economist anticipated that “the key challenge for the Argentinian processors in 2021 is likely to be a low or even negative crush margin due to soaring input and logistical costs . . . Argentinian soybean prices, which rose almost 88% year on year to $341 megatonnes in December 2020, are expected to continue surging in 2021.” In Argentina, high export taxes (at 31 percent) are likely to bring down the normally over-90 percent export rate of its soy products, while tight supply concerns due to dry weather and currency control measures have already begun to impact prices. Meanwhile in Brazil, analysts anticipate sustained momentum for a high crush output in 2021 despite the rising input cost of raw beans. A Goiania-based consultant noted that although the average price for Brazilian beans is expected to rise over 20 percent year-on-year in 2021 due to tight supply, the crush volume is still likely to remain elevated on high prices and strong demand momentum (the 2020-2021 domestic crush demand is projected to remain high at 49 million megatonnes) as the global economy gradually recovers from the pandemic. According to the USDA’s December report, Brazil is expected to export 16.8 million megatonnes of soybean meal and 1.15 million megatonnes of soy oil in 2020-2021, down 7 percent and 9 percent on-year.

New ownership sets Bison up for future growth

05/01/2021

Topic: Bison set up for future growth under new ownership

Manitoba-based conglomerate James Richardson & Sons (JRSL) reached a deal to take over Bison Transport from the Jessiman family on 1 January. Bison, one of Canada’s most prominent trucking companies, has an “aggressive five-year growth plan and needed deeper pockets to execute it” according to Rob Penner, president and CEO of Bison Transport. The plan intends to reach $1.5 billion in sales. Penner emphasises that the new ownership is “a change in shareholder, not a change in operating philosophy.”

World food prices rise for seventh month in a row in December

08/01/2021

Topic: Word food prices rise for seventh month in a row in December

The Food and Agriculture Organization of the United Nations reported that world food prices rose for the seventh consecutive month in December 2020, largely led by dairy products and vegetable oils. The FAO Food Price Index averaged 107.5 points in December, 2.2 percent higher than in November. During 2020, the benchmark index averaged 97.9 points, a three-year high and 3.1 percent increase from 2019. The FAO Cereal Price Index, which rose 1.1 percent from November, averaged 6.6 percent above the level of 2019 in 2020, where export prices for wheat, maize, sorghum, and rice increased in December in response to concerns over growing conditions and crop prospects in North and South America and in Russia. The FAO Vegetable Oil Price Index reached its highest level since September 2012 at 4.7 percent in December due to ongoing supply tightness in major palm oil producing countries and international prices for soy oil rising due to strikes in Argentina. The FAO Dairy Price Index hit its seventh consecutive monthly rise in December by increasing 3.2 percent, with all categories higher as a result of strong global import demand in response to drier and warmer conditions in Oceania and high internal demand in Western Europe. The FAO Meat Price Index increased 1.7 percent in December, while its full-year average was 4.5 percent below that of 2019 due to fluctuations in poultry meat quotations and pork prices. The FAO Sugar Price Index declined by 0.6 percent in December after a notable increase during November, with the sub-index for 2020 as a whole at 1.1 percent higher than 2019 in response to increased imports by China and increased demand for refined sugar from Indonesia despite upward pressure being curbed by improved production prospects in Brazil and India.

England to consult on enabling gene-edited foods post-Brexit

06/01/2021

Topic: England to discuss enabling gene-edited foods in post-Brexit departure from EU policy

The British government will begin consultations on enabling gene-edited crops and livestock in England post-Brexit, a significant departure from the EU policy on agricultural technology. The Department for Environment, Food and Rural Affairs noted that “gene editing held potential major benefits such as reducing dependence on pesticides, and argued the process was distinct from highly contentious genetic modification.” George Eustice, Environment secretary, revealed a ten-week consultation into regulating gene editing differently from GM, a policy that would reverse the European Court of Justice’s 2018 ruling that gene editing should be subject to the same tight regulations. Though EU rules do not ban the use of GM and gene-edited foods, the approval process is stringent. Farming groups like the National Farmers’ Union are lobbying for “a more liberal approach” in the UK post-Brexit (and which is seen in Japan and Argentina, two countries that apply more liberal regulatory regimes to gene-edited products than to other genetically modified organisms). This move towards enabling gene editing in England could invoke the anger of environmental groups, which have, in the past, rejected distinctions between GM and gene-edited organisms and campaigned against both. 

How a ‘hotshot whiz-kid’ ensnared a Sask. company in a $97.5M deal riddled with red flags

10/01/2021

Topic: CBC investigation of American businessman behind the failed purchase of Input Capital

The publicly traded company based in Regina that lends money to farmers in exchange for some of their future canola crop, Input Capital, is investigating the collapse of its $97.5 million proposed sale to American businessman Eric Blue. Input first announced that Washington, DC-based firm Bridgeway National Corporation (owned by Blue) was to make a cash purchase of all Input shares on 12 August, 2020, only for the deal to collapse on 29 October with little explanation. A CBC News Investigation notes that “there were plenty of warning signs that experts say should have caught Input’s attention,” such as Blue’s involvement in multi-million dollar disputes from multiple failed deals with entities like Joy detergent brand and the Tom and Gayle Benson Foundation. Plaintiffs in court have alleged that Blue made “fraudulent commitments and supported them with forged documents,” while court documents also demonstrate that Blue is facing bankruptcy. 

Federal carbon tax system could hit Saskatchewan farmers hard: APAS

10/01/2021

Topic: Saskatchewan farmers concerned about federal carbon tax system

The federal government’s plan to gradually increase its carbon pricing system has many Saskatchewan farmers concerned, with APAS reporting that the tax “has the potential to put some farmers out of business.” In December 2020, the federal government announced the carbon levee per tonne would gradually move to $170 per tonne by 2030 and that while farmers get some exemptions, many of their costs are not exempt. The federal government emphasises that the tax is revenue-neutral and that the majority of consumers will get back as much or more than they pay out. APAS will continue to lobby the federal government.

CBOT agricultural futures show promising prospects

11/01/2021

Topic: Chicago Board of Trade agricultural futures show promising prospects

In early January 2021, Chicago Board of Trade agricultural futures reached seven-year highs while wheat stayed steady to slightly weaker. AgResource, a Chicago-based research company, maintains growing confidence in an expanding economic recovery and greater demand for raw materials as a result of the US Democrats’ new stimulus package and pandemic vaccinations. Spot CBOT corn in particular gained a seven-year high at the start of 2021, with the marketing having been forced to rally following non-US cash feedgrain markets continuing to advance. Meanwhile US wheat at the start of 2021 remained steady to weaker due to a lack of market-specific news and seasonally slow export sales, which allowed for modest profit taking. AgResource reports that the longer-term issue for wheat “is the need for above-trend Northern Hemisphere yields this year,” with sub-trend yields tightening the exporter balance sheets further.

China’s grain inventory ample, sufficient for domestic consumption: NFSRA

14/01/2021

Topic: Ample grain inventory in China means sufficient stocks to meet domestic demands

China’s National Food and Strategic Reserves Administration (NFSRA) announced in January that grain inventories in China achieved a nearly fifteen-year high, while corn stocks in Northeast China tripled compared to the same period in 2020. The high levels at China’s grain inventories means that there are sufficient wheat and rice stocks to meet domestic demand for twelve months, while inventories of refined grains and oils will be sufficient to meet over twenty days of local demand. In the first eleven months of 2020, China’s cumulative imports of wheat totaled 7.49 million tonnes, rice imports at 2.23 million tonnes, and imports of other alternatives (including barley, corn, and sorghum) at 20.41 million tonnes.

France issues ‘clear and final no’ over Carrefour takeover bid

15/01/2021

Topic: France rejects Couche-Tard’s Carrefour takeover bid

France emphasised its opposition to the €16.2 billion takeover of supermarket group Carrefour by Canadian convenience store group Couche-Tard, citing concerns over food security. The offer “aimed at combining two companies with very different formats and geographical footprints into a retailing giant worth more than $50bn and the third-largest grocer globally behind Walmart and Schwartz Group.” 

China’s wheat auction soars on high corn prices, coronavirus fears

19/01/2021

Topic: Rising coronavirus cases and supply fears prompt China wheat auction to soar

In the wake of rising coronavirus cases prompting supply fears and in response to feedmakers seeking alternatives to corn, China sold 99.74 percent (approximately 3,939,732 tonnes) of the total wheat offered at its auction of state reserves in the second week of January. Increasing coronavirus outbreaks and lockdowns in major grain-producing provinces Hebei and Heilongjiang have disrupted logistics and industrial activity, prompting many to panic-buy supplies.

Commodities May Be The Next Big Thing; Here Are 4 ETFs To Get Started

20/01/2021

Topic: Three ETFs to jump on commodity bandwagon

Following Bloomberg reporting a boom in the commodities market, where investors are moving from the bull market in stocks to “areas further afield in search of returns in a very-low interest rate environment,” Hellenic Shipping News offers three ETFs to look into to jump on the commodity bandwagon. These include the Invesco DB Agriculture Fund ETF (one of the largest ETFs holding agricultural commodities), the VanEck Vectors Agribusiness ETF (an ETF that holds agricultural stocks), and the VanEck Vectors Rare Earth/Strategic Metals ETF (an ETF that holds stocks of companies that produce rare earth metals). Hellenic Shipping News also recommends Barclays iPath Bloomberg Copper Subindex for pure copper plays.

Palm prices may hit nine-year high in turbulent 2021

22/01/2021

Topic: Palm prices likely to hit nine-year high in 2021

A Reuters poll showed that palm oil production in Malaysia and Indonesia is expected to recover and drive unpredictable prices in 2021, the latter being expected to rise to nine-year highs. At the start of the year, Malaysia’s benchmark palm oil contract began at near decade-high levels of $940.13 as a result of a supply crunch in global edible oils. However, prices are expected to average at $694.96 per tonne in 2021. Christopher CHai, general manager with Kwantas Corp, expects a turbulent 2021, stating that “the market is expected to face more volatility because crude palm oil price has gone way beyond expectations.” Global palm oil production is expected to recover in the second half of this year after last year’s heavy rains and labour shortages worsened by the pandemic impacted supply in Indonesia and Malaysia. Indonesia’s production is rising 1.8 percent from 2020 to 48.3 million tonnes, while Malaysia’s production anticipates a rebound by 2.4 percent to 19.6 million tonnes. 

Shipping carriers rejected tons of US agricultural exports, opting to send empty containers to China

26/01/2021

Topic: Shipping carriers reject US agriculture exports and opt for Chinese exports

During November and October 2020, shipping carriers rejected an estimated 117,938 US agricultural export containers (TEUs) worth millions of dollars and instead sent empty containers to China to be filled by more profitable Chinese exports. US agricultural exporters pushed petitions to the Federal Maritime Commission, warning that “the delays in trade not only threaten profits but the reputation of the industry.” The refusals came during peak season for US agriculture exporters. During their reviews of the import and export data from January 2020 to November, CNBC found “the pattern of this growing US export container deficit started as early as June for Los Angeles, July for Long Beach, and August for New York and New Jersey,” where from July through November, a total of 297,997 TEUs were denied—a container deficit value of $1.1 billion.

Chinese Entrepreneur Jack Ma Missing After Criticizing the Party

11/01/2021

Topic: Well-known Chinese tech entrepreneur missing after criticizing CCP

The well-known Chinese tech entrepreneur and billionaire Jack Ma has not been seen in public after angering the Chinese Communist Party (CCP) in a speech he gave at the Bund Summit in Shanghai in October, where he criticized China’s financial system and its regulators.

Minister Ng announces launch of Highly Affected Sectors Credit Availability Program

26/01/2021

Topic: Minister Ng announces launch of Highly Affected Sectors Credit Availability Program

On 26 January, 2021, Minister of Small Business, Export Promotion and International Trade, the Honourable Mary Ng, announced the launch of the Highly Affected Sectors Credit Availability Program (HASCAP). HASCAP intends to “provide financial support to businesses that have been hardest hit by the pandemic,” being available to businesses in all sectors across the country. Through HASCAP, the Business Development Bank of Canada (BDC) “will work with participating Canadian financial institutions to offer government-guaranteed, low-interest loans of up to $1 million.” Eligibility for HASCAP depends on showing a year-over-year revenue decline of at least 50 percent in three month, within the eight months prior to application. Businesses must also be able to demonstrate to their financial institutions that they have previously applied for either the Canada Emergency Wage Subsidy or the Canada Emergency Rent Subsidy. Applications opened in February.

Global grain supply-demand mismatch to continue at least for next 2 years: ADM

29/01/2021

Topic: Global grain supply-demand mismatch expected to continue for next two years

On the back of strong demand and tight balance sheets, the global grain and oilseed supply-demand mismatch is expected to continue for at least the next eighteen to twenty-four months according to Archer-Daniels-Midland CEO Juan Luciana. However, ADM’s CFO Ray Young noted that “green shoots of recovery in 2021” are expected for the US ethanol industry, which had previously suffered a major setback in early 2020 due to stay-at-home orders and declining gasoline prices and which is expected to be supported by the reconfiguration of ethanol capacity by various competitors and how small refinery exemptions will play out in the coming months. While ADM’s ethanol business performance in the first quarter of 2021 is expected to be much higher than the first quarter of 2020, it is expected to be lower than the fourth quarter of 2020 due to industry challenges remaining around ethanol margins. Additionally, ADM’s grain and oilseed business in the first quarter of 2021 is expected to be higher than the first quarter of 2020, largely as a result of strong North American export demand and continued healthy crush margins.

Conrad Black: Disgraceful treatment of Julie Payette diminishes the governor general’s office

29/01/2021

Topic: Conrad Black opinion piece on Julie Payette’s departure

In his opinion piece, Conrad Black discusses “the fiasco of departed Governor General Julie Payette” and how it “highlights what has gradually become the terminal absurdity of that office.” Black argues that for the Governor General to be ousted from office “because of anonymous complaints against rude and authoritarian management,” it is “an abysmal farce and it makes a mockery of the constitutional confusion and obsolescence that afflicts the Canadian state.”

Non-energy commodity prices rise at fastest rate since 2011

01/02/2021

Topic: Non-energy commodity prices see fastest rising rate since 2011

As the manufacturing side of the global economy bounces back after the pandemic troubles of 2020, commodity prices are rapidly rising. By November 2020, “global manufacturing activity had recovered all of its pandemic-related losses and merchandise volumes were more than one percent higher than prior-year levels.” Following this, a surge in commodity consumption has lifted the prices for almost all commodities above last year’s levels, boosting producers’ income at the expense of consumers. Non-energy commodity prices in particular were up by a weighted average of more than 16 percent in December compared to the same month in 2019, with non-energy prices at the highest average level since mid-2014 and rising at the fastest rate since mid-2011. The biggest driving force behind this rapid rise is the resurgence of global manufacturing and merchandise consumption despite ongoing restraints due to the pandemic. This resurgence is boosting demand for raw materials and intermediate items like semiconductors, as well as stretching the ability of freight and logistics systems to cope. However, rising commodity prices are an issue in that they are altering the terms of trade both within and between nations, thereby redirecting income and spending flows. 

Conrad Black: Canada must retaliate over Biden’s ill-considered Keystone decision

06/02/2021

Topic: Conrad Black opinion piece on Biden’s Keystone XL pipeline decision

In his opinion piece, Conrad Black is once again frothing at the mouth argues that “Canada absolutely has to retaliate for the outrageous and cavalier cancellation of the Keystone XL pipeline,” arguing that the proposed pipeline is “a carbon-neutral and environmentally safe pipeline and its cancellation will lead to more expensive and ecologically risky means of transporting oil, as well as economic hardship for hundreds of thousands of Americans and Canadians.”

Opinion: Don’t Stop at Big Tech—We Need to Bust Big Agriculture, Too

03/02/2021

Topic: Opinion piece on antitrust enforcement against Big Agriculture

In their opinion piece, Rob Larew and Diana Moss of the Modern Farmer emphasise that the step up in antitrust enforcement against Big Tech needs to be directed toward Big Agriculture. They argue that because sectors like food and agriculture “are essential to the health, safety and well-being of consumers, and even to our national security,” antitrust laws must be enforced against violations in these sectors. They write that “much like their counterparts in the tech sector, many of the largest food and agriculture corporations have acquired their way to dominance by gobbling up rival businesses,” and they emphasises that “some parts of the agriculture sector are rife with other damaging antitrust violations that we haven’t seen in Big Tech. This includes alleged conspiracies to fix prices and allocate markets—practices that are made possible by high levels of consolation and concentration.”

How a Vancouver company is helping export Canada’s canola to the world

25/01/2021

Topic: West Coast Reduction Ltd helps export

One of Canada’s largest canola oil storage hubs out of the Port of Vancouver, West Coast Reduction Ltd. is helping Canada to sell more canola oil to the world. Approximately 20 million metric tonnes of canola is grown by Canadian farmers each year (with 90 percent destined for export); however, the Canola Council of Canada aims to produce 26 million metric tonnes annually by 2025. Challenging this goal is the issue of transportation and storage, particularly as this goal entails increasing exports by about $3.5 billion per year between 2021 and 2025. West Coast Reduction intends to address this concern, as the company has the capacity to both store canola in oil form (with over 83,000 metric tonnes of alternative-liquid storage at its Port of Vancouver facility) and export it directly to Asian-Pacific markets. Additionally, in order to keep up with the increase in demand, West Coast Reduction has also been broadening its canola storage and export capacity by completing a $9.5 million expansion of its shipping terminal in 2014 and 2015, increasing its canola oil handling capacity by 25 percent through updates to its rail lines and a piping system that transfers canola oil to ships in the dock.

Humanity Is Flushing Away One of Life’s Essential Elements

08/02/2021

Topic: A history of phosphorus cultivation and use

The Atlantic writer Julia Rosen documents the environmental and agricultural history of phosphorus cultivation and use, includings its importance as a fertilizer and a potential “phosphorus catastrophe” in the future, where “the clear consensus among phosphorus experts is that humans must start mending the phosphorus cycle to reduce the environmental damage caused by pollution and to waste less of an increasingly scarce resource.”

Ukraine wheat export prices fall under Russian export pressure

09/02/2021

Topic: Ukraine soft milling wheat export prices fall under Russian export pressure

A jump in Russian grain exports ahead of future exports restrictions has led to Ukrainian soft milling wheat export prices to fall by $10 to $11 per tonne in the second week of February, according to APK-Inform. Ukraine has sold 29.4 million tonnes of grain abroad in the 2020/2021 July-June season so far (20.5 percent less than the same period in the previous season), which included 13.09 million tonnes of wheat, 11.8 million tonnes of corn, and 3.95 million tonnes of barley. The government has noted that while Ukraine sold about 57 million tonnes of grain to foreign buyers in the 2019-2020 season, they expect that exports could decline to 45.4 million tonnes in the 2020-2021 season due to a weaker harvest.

Investors set for commodities ‘bull run’ as prices rise in tandem

09/02/2021

Topic: Sector-wide commodities ‘bull market’ anticipated as prices rise in tandem

Analysts and investors state that the upswing in commodity prices following the apex of the pandemic “represents just the first leg of a sector-wide ‘bull market’ fanned by government spending.” Anticipating a repeat of the “supercycle” of the 2000s—in which oil and metal prices hit record highs in response to China’s rapid industrialization—some Wall Street banks are encouraging their investors to “increase their exposure to raw materials, which are poised to benefit from a vaccine-driven global economic recovery, aided by fiscal stimulus.” While some investors claim that the market is not yet ready to begin a new supercycle, those who are predicting a new supercycle “point to global recovery programmes that put greater emphasis on job creation and environmental sustainability than on inflation control.”

US farmers eye range of good planting options after biggest grains rally in years

10/02/2021

Topic: Big grains rally mean US farmers optimistic about crop revenues

Many farmers are capitalising on 2021 being “their most profitable season in years” due to increased demand for exports and domestic processing industries that produce animal feed and biofuel, with many farmers expecting high crop revenues for the first time in years. The USDA forecasted a 73 percent drawdown in soybean stocks (the biggest year-on-year decline since 1963) and a 19 percent drop in corn supplies (the biggest drop in a decade), while new-crop soybean prices are 25 percent higher than they were in 2020 and new-crop corn prices are up 15 percent from 2020.

2.5m tonnes of US soya beans exported in containers in four months

10/02/2021

Topic: Record high of US soybeans exported in containers, decline in share of total exports

A record high 2.5 million tonnes of US soybeans were exported in the first four months of the 2020-2021 US marketing year, accounting for 6.3% of total exports. However, despite this high, the share of total US soybean exports being sent in containers has declined from previous years and is currently at its lowest level since the same period in 2017. 

China’s record corn purchases have traders wondering if bump can last

12/02/2021

Topic: Surge in corn prices following record Chinese purchases leave traders wondering

Farmers and analysts are left wondering if the surge in corn prices following record purchases by China can be maintained. The surge in imports of corn comes as a surprise to many given China’s previous goals for self-sufficiency, with the US Department of Agriculture announcing that China had bought a record 11.3 million tonnes of corn in 2020 and another 2.1 million tonnes in late January 2021—the largest single sale to the country in history and the second largest on record. Some view the rise in Chinese imports as temporary, while others see it as “more of a cyclical issue than a structural one.” Pete Meyer, head of grain and oilseed analytics at S&P Global Platts states that “the gap between China’s production and consumption of corn has been steadily rising in the past few crop years,” with Meyer anticipating this gap to rise to 30-32 million tonnes in 2021-2022.

News Release: Sask Wheat encourages farmers to participate in the Canada Grain Act consultations

12/02/2021

Topic: Sask Wheat encourages farmers to participate in Canada Grain Act consultations

The Saskatchewan Wheat Development Commission (Sask Wheat) encourages grain farmers to participate in the consultations on the Canadian Grain Act review. Brett Halstead, Sask Wheat Chair, notes that “Sask Wheat is actively participating in this review, but there will be a great opportunity to influence the changes in the Act if as many farmers as possible  contribute their opinions and experiences during the review.” In this review, topics to be discussed include variety classification, producer payment protection, Canadian Grain Commission (CGC) oversight on objective measurements, access to binding determination, and improved data collection and reporting. Farmers have until 30 April, 2021 to submit their feedback.

BBC Follow the Food: The Reason We Are Running Out Of Farmers

2021

Topic: BBC discusses the ageing trend in agriculture

In this article written for their multimedia Follow the Food series, which investigates how agriculture is responding to several ongoing economic, social, and political issues, the BBC documents the global trend of ageing farmers. According to the International Labor Organization, the percentage of people working in agriculture has dropped from 44 percent in 1991 to 26 percent in 2020 due not only to growing use of agricultural technology, but also to the fact that people no longer want to work on farms. The BBC notes that in developed countries (the US included), the average age of the farmer is sixty, while across the global the average age of farmers is increasing as rural youth turn to the city for work. The article lists several reasons that young people are hesitant to take up farming, from farming being regarded as “badly paid work for unskilled people,” to environmentally conscious young workers questioning agriculture’s green credentials, to spiralling prices and gender gaps that bar access to land. Citing the World Food Programme, the article notes that “as many as 150 million people could be lifted out of hunger and poverty if women farmers had the same access to agricultural resources as men.” Ultimately, the BBC argues that “if our society can begin to break down the barriers that are keeping the next generation of agricultors off the fields, we could see the beginnings of a return to the land.”

Brazil’s Slow Soybean Harvest Widens US Export Window

15/02/2021

Topic: US export window increased by harvesting delays in Brazil

Due to harvesting delays in Brazil, buyers led by China are being prompted to depend on rival exporter the US for longer than normal in 2021. This sustained demand for US soybeans is rapidly accelerating a historic drawdown of US supplies and has the potential to further drive up soybean prices at a time of food inflation resulting from food hoarding during the pandemic. While Brazil usually harvests its soybeans in the first three months of the year (indicating an end to the dominance of US exports), this process has been delayed by last year’s drought slowing planting and rainfall at harvest time. Brazil’s shipment of soybeans in January were 28 times lower than in 2020 at 49,500 tonnes. The US, by contrast, had approximately 8.9 million tonnes for shipment in January (the highest on record). It is anticipated that in February, Brazilian soybean shipments could be as little as 6 million tonnes, down from 8.5 million tonnes initially expected, with supplies only expected to normalize by March.

Shipping Companies Look at Sailing Away from Choked Southern California Gateways

08/02/2021

Topic: Bottlenecks in Southern California mean offshore anchorage, supply chain disruptions as shipping companies look for alternatives

Bottlenecks at the main US trade gateways in Southern California have resulted in cargo vessels anchoring offshore and some container lines and their importing customers looking for alternative paths. France’s CMA CGM SA said it was replacing a weekly six-ship service from China to Los Angeles with a separate sailing to Oakland, California, and Seattle, while some carriers have canceled sailings altogether rather than have their ships tied up for extended periods of time at a single port. As a result of the backups, inventories have been tied up for weeks and supply-chain stresses are rising. However, industry observers do not expect the backups to be cleared soon, stating that “companies are still trying to step up the pace of inventory restocking while Chinese reproduction and exports remain strong.”

U.S. farmers celebrate soy price surge as Brazil misses out

19/11/2020

Topic: Soy prices surge to benefit of US farmers, Brazil misses out

Soybean futures at the Chicago Board of Trade SV1 were pushed up 12.31 percent between 1 August and mid-September—when harvest began across the US Midwest—due to strong exports to China. However, Brazil lost out on the “unusual surge” as a result of their opposite growing cycle in the southern hemisphere, having previously benefited from the US-China trade dispute that began in 2018. According to grain group Aprosoja, Brazil pre-sold approximately half their crop before August when a 60 kilogram bag was about 80 reals, which is less than half of the 170 real ($31.26) current price level. Owner and chief executive of AgriBrasil Frederico Humberg told Reuters that most contracts have “no guarantee” that the grain will be delivered, as buyers do not provide pre-payment for the grains. Humberg stated, “‘If Chicago prices and the dollar continue to be at current levels, problems will occur . . . Come time to collect the beans, farmers may allege yields fell or some kind of weather problem in a bid to improve the terms of the grain sale done in advance.” 

Chinese buying spree pressures EU grain market

30/11/2020

Topic: China’s grain consumption puts pressure on EU market

Due to an extended buying spree of global grain, EU grain markets are witnessing sharp price rallies as traders struggle to meet export demand among a supply deficit. Traders and analysts report that prices may continue to rise until demand is lessened or until the next harvest, leaving local buyers, like livestock feed makers, to contend with importers. While no visible food price changes are expected downstream, upstream grain processors may need to slow buying if exports continue to move out of Europe. Consultancy Agritel urged that “we’re looking at a very strong need to ration wheat demand in Europe in the coming months.” As for maize, within Europe no relief has been found. Ukraine, the EU’s primary maize supplier, has grappled with drought, complicating expected flows to the EU livestock industry, which is heavily import-reliant; consequently, prices for maize are rising and processors are looking to use more feed wheat or secondary cereals. So far, maize imports in 2020/2021 in the EU and Britain are 17 percent lower than last year.

Australia’s 2020-21 wheat forecast raised to 31.2 mil mt on favorable weather

01/12/2020

Topic: Favourable weather raises Australia’s 2020-21 wheat forecast to 31.2 mil mt

According to the Australian Bureau of Agricultural and Resource Economics and Sciences (ABARES), Australia’s national wheat production for the 2020-2021 crop year is expected to surge 106 percent year on year to 31.2 million megatonnes—2.3 percent higher than ABARES’ September forecast of wheat production for the crop year at 28.9 million megatonnes. Persistent improved weather in the face of severe drought for three consecutive years, higher yields, and increased planting acreages are driving higher output forecasts. Market sources expect Australia to regain its global market share on the back of the increases in production, with one trading source stating, “They should capture the vast majority of Southeast Asia, Bangladesh and some of the Middle East and East Africa [markets].”

Peas and Lentils Are the Latest to Be Hit by Container Squeeze

20/11/2020

Topic: Container shortage in Vancouver slows Canada’s exports of pulses

At Vancouver port, the shortage of containers slowed Canadian exports of lentils and peas, with tonnes of pulses from the world’s largest producers remaining in storage on farms and elevators as a result. This bottleneck impacted farmers just as pulse exports to Asia and India generally picked up following large Canadian harvests. Ray-Mont Logistics Inc. “has seen the amount of grain that it can transfer from rail cars to containers there [in Vancouver] drop by one-third to one-half since mid-October.” Stephen Paul, vice president of supply chain logistics for Ray-Mont in Montreal, noted that the shipping constraints may last at least into the first quarter. Greg Northey, vice president of Pulse Canada’s corporate affairs, commented, “The lack of consistency and reliability in container supply does put at risk the opportunity for farmers and the pulse trade to capitalize on the high demand for pulses around the world.”

David Clement: Will no MP stand up to supply management?

09/12/2020

Topic: David Clement opinion on government response to supply management

In his opinion piece, David Clement responds to the House of Commons’ first reading of Bill C-216, a private member’s bill forwarded by the Bloc Québécois to protect supply-managed farmers from concessions in future trade deals. Clement argues for phasing out supply management with a transition plan, arguing that the move “is fair for producers, helps Canada embrace trade, and lowers prices on essential food items.” By approving the bill, Clement argues, “any future trade deal—with the United Kingdom post-Brexit, say—would be sidetracked if our counterparts requested concessions in these areas.” Addressing the claim that supply management protects the family farm, Clement states that the Canadian supply-managed sector is “just as susceptible” to consolidation as the rest of agriculture. He points out that when the system was first put in place in the 1970s, there were over 100,000 dairy farms in Canada, while today there are fewer than 11,000. Clement acknowledges that while eliminating supply management would mean more competition for dairy farmers, “it would also mean more export opportunities abroad” with growing markets as a result of increasing globalization. He goes on to argue that the transition from protection to competition is not unknown to other Canadian industries, such as Canadian wine when Canada first sought a free-trade agreement with the US.

Yara plans green ammonia production in Norway

07/12/2020

Topic: Norwegian fertilizer producer plans green ammonia production

Yara, a Norwegian fertilizer producer, has announced plans to produce 500,000 tonnes per year of green ammonia at its plant in Porsgrunn, Norway. Currently, the producer is looking for partners and government support with their aims to fully electrify its ammonia plant, with the potential to cut 800,000 tonnes per year of CO2, and to capture opportunities with shipping, agriculture, and industrial applications in a market expected to grow by 60 percent over the next two decades. Ammonia is considered a promising hydrogen carrier and zero-carbon shipping fuel due to its chemical properties, with ammonia not requiring cooling to extreme temperatures and having a higher energy density than liquid hydrogen, which makes it more efficient to store and transport. Should Yara receive the required public co-funding and regulatory framework, the project could be operational in 2026. This project would eliminate one of Norway’s largest static CO2 sources and would contribute toward Norway’s Paris agreement commitments.

U.S. feedmakers hoard soybeans as supplies dwindle

11/12/2020

Topic: US feed makers hoard soybeans as supplies fall

Due to soaring global demand for soybeans this fall, US feed makers were forced to hoard supplies. This renewed demand pushed soybean prices to a four-year high, while the dwindling supply base had the potential to fuel the recent price rally and prompt farmers to plant more acres of soybeans in 2021 to meet demand. Many US farmers struggled during a four-year supply glut, particularly during the US-China trade war, and faced languishing prices at unprofitable levels. However, the COVID-19 pandemic of 2020 motivated soy buyers to stockpile supplies in the wake of concerns over further lockdown measures, leaving US farmers to either struggle to find places to place their soybeans which they had to purchase on the cash market or be taken over by competitors. Typically, during the previous twenty years, farmers still held about 38 percent of their harvest soybeans in storage bins on 1 December, according to US Agriculture Department data. In 2020, US farmers had already sold 80 percent of the 4.17 billion-bushel soybean crop by the time harvest ended in November, global head of grain futures at ED&F Man Capital Charlie Sernatinger reported. In contrast to Argentina’s reluctance to sell their soybeans to local crushing plants due to currency weakness, US farmers were eager to sell after many years of low demand.

AGT Foods eyeing return to public markets: CEO

07/12/2020

Topic: AGT Foods potentially returning to public markets

Chief executive of AGT Foods and Ingredients Inc. Murad Al-Katib stated in a television interview on Monday, 7 December, 2020 that the company may return to public markets again. The Regina-based company previously went private in 2019 with the backing of Fairfax Financial Holdings Ltd. and Point North Capital Inc., with Al-Katib stating that there have been benefits to remaining private. During the pandemic, Al-Katib states, “we saw how markets reacted and overreacted to a number of sectors. Being private for us has been a very strong thing in particular on our innovation platform,” referring to securing global partnerships with major consumer product companies. 

FEATURE: Container shortage weighs on US grain prices, drawing scrutiny from regulators

15/12/2020

Topic: Container shortage impacts US grain prices, regulators sceptical 

Due to a shortage of available containers obstructing access to export markets, prices for some US agricultural products have trended lower and products normally exported in containers were said to be moving into other outlets, such as domestic feedlots and river barge terminals. The shortage has drawn the scrutiny of the Federal Maritime Commission, the primary US shipping industry regulator, “as many shipowners prioritized repositioning empty containers back to Asian ports to take advantage of more lucrative headhaul trans-Pacific container rates.” In addition to divergent rates of return prompting shipowners to collect empty containers at US ports and return them to Asia, the US goods trade deficit increased at more than $80 billion, escalating the shortage of containers available for US exporters in October 2020.

Abu Dhabi plans five agriculture investment projects worth $143mln

17/12/2020

Topic: Abu Dhabi plans five agriculture investment projects worth $143 million

The Abu Dhabi Agriculture and Food Safety Authority (ADAFSA) approved five investment projects with AED 524 million to establish fish, fruit, vegetable, cattle, and poultry farms on a total land and sea area of approximately four million square meters. As part of ADAFSA’s attempts to increase farming projects and achieve sustainable agricultural development in Abu Dhabi, investment opportunities will be developed by private sector companies in the agriculture sector. Contracts were signed between ADAFSA and Aqua Fishers Company, Mirak Agricultural Services Company, Alfalfa Company, Al Nahdha Farm, and Emirates National Poultry Farms. Director-General of ADAFSA Saeed Al Bahri Salem Alameri “indicated that ADAFSA has developed a strategy that aims to create promising investment opportunities in agricultural and food sectors, introduce partners and investors to available investment opportunities in Abu Dhabi, advance local investments, build partnerships with investment funds, investors and the private sector in areas of its activities, and ensure those investments are aligned with government objectives.”

North American farmers profit as consumers pressure food business to go green

04/12/2020

Topic: North American farmers profit from consumers’ preference for green food businesses 

As consumers pressure food producers to support sustainable farms, some farmers are benefiting from the demand for change by earning extra money from industry giants like Anheuser-Busch, Cargill, and Nutrien. For example, Nutrien, a farm retailer and fertilizer producer, are monetizing the carbon their fields absorb, opening up a new avenue for revenue for farmers. Agriculture technology company Indigo Ag conducted a study that estimated “if US corn, soy and wheat farmers employed no-till and cover crops on 15% of fields, they would generate an additional $600 million by reducing costs, bolstering soil productivity or selling carbon credits.” However, industry sources and activists note that while Washington and Ottawa are expected to grow more committed to funding and regulating sustainable farming, widespread adoption still has a long way to go.

Watch: Market movers Europe: Oil demand recovery and sustainability goals to drive commodity markets in 2021

21/12/2020

Topic: S&P Global Platts looks ahead to 2021 themes driving commodity markets

S&P Global Platts’s Market Movers predicts several themes that will drive commodity markets in 2021. Regarding oil fundamentals, S&P Global Platts Analytics anticipates that while demand will rebound by more than 6 million barrels a day, consumption will be more than 2 million barrels a day below 2019’s 101.9 million barrels a day. This drop is driven by increased pressures felt by the middle classes, “the real engine of oil demand,” during the COVID-19 pandemic. OPEC+ producers do not anticipate any relief from 2021, which “were forced into historic output cuts by the spread of the pandemic.” Carbon markets, regulation, and international policy makers will come under increased scrutiny, with postponed global climate change talks finally taking place in Glasgow in November. S&P Global Platts is launching a new benchmark for carbon credit prices to be called Platts CEC, an assessment which reflects the CORSIA-eligible carbon credit market and is to begin publishing on January 4. A plastics tax is to be introduced in Europe, with each EU member state making contributions to the bloc’s budget based on the amount of non-recycled plastic packaging used; however, it is up to each member state to decide whether it comes out of a national budget or if they implement a direct tax on companies within their own country. In response to this plastics tax, market participants expect surging demand for recycled plastics. Regarding metals markets in Europe, strong expected demand from infrastructure spending and stimulus supported the demand outlook.

Commodities 2021: US soybean prices likely to rise on high exports, tight stocks

22/12/2020

Topic: US soybean prices likely to rise on high exports, tight stocks

Robust Chinese demand for US soybeans coupled with tight stocks mean that US soybean prices are likely to soar in 2021. For the 2020-2021 marketing year, S&P Global Platts Analytics forecast the average farm price of US soybeans at $10 per bushel, up 17 percent on the year, while the US Department of Agriculture’s World Agricultural Supply and Demand Estimate report forecasted at $10.55 per bushel, up 23 percent. The USDA attributed the expected rise in soybean prices to the larger exports volume expected in 2020-2021, with exports forecasted at 59.87 million megatonnes, up 31 percent year on year. In addition to continued robust purchasing of soybeans by China following their recovery from African swine fever disease, US soybeans prices are expected to be supported by rising domestic crushing and lower end stocks. However, there is uncertainty surrounding the fate of the US-China Phase 1 deal, which President-elect Joe Biden advocates for a “full review” of the agreements, and how that will impact US soybean prices and stocks.

Commodities 2021: Australian wheat to weather China trade concerns on expected bumper harvest

23/12/2020

Topic: Expected Australian wheat bumper harvest outweighs concerns over Australia-China trade concerns

Concerns over strained Australia-China trade relations may be weathered by an anticipated record Australian wheat crop—estimated to be the second-largest in the country at 31.2 million megatonnes. Favourable weather has moved Australia out of its three-year drought while Argentina has struggled following a winter drought, allowing Australia to dislodge Argentina from the southeast Asian wheat market in the first quarter. S&P Global Platts reports that “at least 750,000 mt of Australian feed wheat has been booked to-date for December 2020-April 2021 shipment to Thailand and the Philippines, 57% higher than a year ago.” As the Black Sea has proved to be a considerable influence in global wheat prices over recent years, Australia’s massive turnaround in the 2020-2021 wheat production suggests they compete with the Black Sea for this position of influence. As for ongoing troubled trade relations between Australia and China, Australian exporters “fear missing out on China’s growing grain-purchasing binge” despite pulling back its wheat exports to China in September 2020 following China’s warning to heighten inspection of Australian wheat vessels. On the domestic end, Australian bulk handlers face higher elevation costs from managing such a large crop, while shipping capacity grows tighter from prompt shipments due to end-users continuing to buy hand-to-mouth among demand uncertainty. Additionally, the volatility of the Australian dollar increases the risk of making its exports less competitive in global markets.

Recovery in US agriculture, demand from China sustainable in long term: The Andersons

04/11/2020

Topic: The Andersons announce recovery in US agriculture sustainable in long-term from China demand

Pat Bowe, President and CEO of US-based agribusiness the Andersons, announced in the company’s third-quarter earnings call on 4 November that US agriculture fundamentals will be sustainable in the long-term due to demand from China and other Asian countries. China has increased its purchases of US agricultural products, with Bowe expecting this increased demand from China “to run well into the first quarter of 2021.” Bowe also anticipates the demand for US corn to remain high into early 2021 as a result of both China’s buying and improved domestic demand from the ethanol industry. Additionally, the Andersons expects agricultural commodity prices to remain strong following dry weather in leading producers of corn and soybeans Brazil and Argentina, which will likely result in smaller crop output in both countries. In the third quarter of 2020, Andersons recorded improved on-year results from its ethanol segment, buoyed by higher crush margins and “relatively balanced industry supply and demand” that resulted in EBITDA attributable to the company of $11.1 million—up from the 2019 third-quarter EBITDA attributable to the company of $3.9 million.

Brazil forecasts record grain output in 2020-2021 harvest season

12/11/2020

Topic: Brazil anticipates record grain output in 2020-2021 harvest season

Brazil anticipates a record grain output of 268.9 million tonnes in the 2020-2021 harvest season, 4.6 percent more than the 2019-2020 season, according to the state-run National Supply Company (Conab). With an estimated 67.1 million hectares of land cultivated—the most land cultivated on record—Brazilian soybean production should reach 135 million tonnes. This would confirm Brazil’s ranking as the world’s largest producer of soybeans, with a cultivation area of 38.2 million hectares. Soybean exports are expected to reach approximately 82.7 million tonnes this year, with 81.4 million tonnes already exported between January and October. Next year’s exports should reach 85 million tonnes. For other agricultural products, corn production is estimated to reach 104.9 million tonnes, bean production is expected to reach 3.1 million tonnes, and wheat production—with 80 percent of the 2020 harvest already completed—estimated at 6.4 million tonnes.

Telus digs into agriculture as it diversifies its revenue

12/11/2020

Topic: Telus to power farming and food technologies

After making a series of acquisitions to help diversify its revenue, Telus Corp. is pushing its agriculture business to use its telecommunication networks to power farming and food technologies, including soil sensors and autonomous tractors. On 12 November, Telus announced that its Agriculture business unit will “provide supply chain management and data analytics services to businesses at each level of the food chain.” Executive vice-president Francois Gratton stated that Telus turned to the agriculture sector due to its different players not efficiently sharing information between themselves, explaining, “‘We saw a huge opportunity to increase yield, reduce waste and, importantly, be able to trace the quality and safety of your food from its origin.’” In the past year, Telus has acquired seven companies from Canada, the US, and the UK that, when combined, “cover the entire food system.” Telus argues that by connecting data across each level of the food chain, it could “help trace the origin of foods to the field level, helping retailers deal with foodborne illness outbreaks without having to indiscriminately throw out tonnes of product.” Telus states that its agriculture sector began much like its health sector, Telus Health, as part of a strategy to expand beyond its “classic” telecommunication services. This move also involves Telus’s expanding 5G mobile network generation. 

Asia-Pacific countries sign one of the largest free trade deals in history

15/11/2020

Topic: Fifteen Asia-Pacific countries sign one of the largest free trade deals in history

On Sunday, 15 November, leaders from 15 Asia-Pacific countries signed one of the largest free trade deals in history as part of its effort to “reduce barriers in an area covering a third of the world’s population and economic output.” Following almost a decade of negotiations between the Association of Southeast Asian Nations and Australia, China, Japan, New Zealand, and South Korea, the Regional Comprehensive Economic Partnership (RCEP) indicates a significant step forward for economic integration in the region. RCEP combines a mix of separate arrangement into a single deal, aligning Asia more closely with other coherent trading zones like the EU or North America. While Japan and South Korea are expected to benefit the most from the deal, the benefit of cheaper goods will also spread as far as Europe and the US, Financial Times writers Robin Harding and John Reed state. However, analysts of the deal say the deal will likely further diminish US influence in the region following Trump’s withdrawal from the Trans-Pacific Partnership. Beyond this, the deal includes two significant chapters—the rules of origin, which determine where a product is made, and the first free trade deal between China, Japan, and South Korea. What the deal lacks is ambition, Harding and Reed observe, with the RCEP eliminating 90 percent of tariffs compared with almost 100 percent in the Trans-Pacific Partnership, agriculture being largely absent, coverage of services mixed, India’s withdrawal from the talks in 2019, and concern over China’s dominance in the deal.

CEA startup AppHarvest to go public, expects $475m funding at $1bn valuation

01/10/2020

Topic: CEA startup APPHarvest plans to go public 

AppHarvest, a US-controlled environment agriculture (CEA) startup, announced its merge with NASDAQ-listed special purpose acquisition company Novus Capital, allowing it to go public. Estimated to bring in $475 million in gross proceedings, including a $375 million private investment in public equity transactions from existing and new investors like Inclusive Capital and Novus, the deal values the company at $1 billion. Novus chairman Bob Laikin said in a statement: “AppHarvest is a unique and compelling investment opportunity that is redefining American agriculture by improving access for all to fresh non-GMO produce, growing more with fewer resources, and creating an agtech hub from within Appalachia.” AppHarvest is set to launch what it claims to be the world’s largest greenhouse in a 2.76 million square foot facility in Morehand, Kentucky later in 2020. Reportedly, the system it uses reduces water usage by 90% as opposed to traditional open-field agriculture. In the future, AppHarvest will focus on bringing its beefsteak and on-the-vine tomatoes to market, with the first harvest at its Morehead facility expected for early 2021. The startup hopes to eventually expand into bell peppers, berries, cucumbers, and leafy greens.

Russia gets closer to new wheat harvest record thanks to surging grain yields

05/10/2020

Topic: Surging grain yields moves Russia closer to new wheat harvest record

According to the latest data from the Russian Ministry of Agriculture, Russia has boosted grain yields by around six percent year-on-year, harvesting 124 million tonnes of grain. As of 2 October, Russian farmers have cultivated over 90 percent of planted lands, with crop yield at 28.6 centner per hectare—a not insignificant jump from the 26.9 centner per hectare over the same period last year. Russian wheat harvest rose to 85.9 million tonnes, nearly matching the 2017 record of 86 million tonnes. This massive grain harvest means Russia is expected to retain its leadership in the global wheat market in the coming years. Pakistan is projected to become another major importer of Russian wheat this year ever since the country’s government announced on 2 October that it will ship 180,000 million tonnes of Russian wheat without taxes and duties. 

‘Structural failure’ downs Vancouver terminal grain bin

17/09/2020

Topic: Vancouver terminal grain bin down after “structural failure”

On 11 September, the collapse of a new commercial-scale grain bin at Fibreco’s Vancouver port terminal is undergoing investigation. On 12 September, Fibreco Export Inc., a wood fibre exporter, confirmed that there were no injuries and stated that it was “working with various government organizations to investigate the cause and concurrently developing a plan to safely resume operations as soon as possible.” Grain handling and storage equipment manufacturer Ag Growth International (AGI) is also investigating the cause of the collapse, reporting that it had built the bin and fourteen others at the site. The collapsed bin was part of a new bin line released by AGI that saw another “failure” in May last year at a different site. In response to the May 2019 incident, AGI reported that “it undertook an extensive engineering re-evaluation of the product prior to inclusion in two additional applications.” In a separate statement, AGi announced that it would investigate all bins in the product line as part of its standard protocol.

Fibreco silo collapse under investigation

15/10/2020

Topic: Fibreco silo collapse under investigation

A brand new, 12-storey tall grain storage bin at Fibreco’s McKeen Avenue export terminal collapsed due to a structural failure during loading on 11 September around 2:15 PM. District of North Vancouver Fire and Rescue Services members set up a “collapse zone” around the silo as structural engineers determined what the next steps should be. In 2017, Fibreco announced its plans to redevelop the McKeen Avenue site and to build all new silos and elevators for exporting grain. Fibreco’s site contains 15 silos similar to the collapsed silo built by Ag Growth International, which was hired to build 20 more silos for another customer. As of Tuesday 15 September, Ag Growth International stock fell more than nine percent. 

Evacuation lifted after elevator fire

09/10/2020

Topic: Evacuation lifted after Marengo elevator fire

On the night of 8 October, a large grain elevator in the western Saskatchewan village of Marengo was destroyed by fire. A state of emergency was declared for the surrounding Rural Municipality of Milton No. 292 and remained in effect until noon of 9 October, with the evacuation order given to Marengo residents and ten homes in the RM lifted that morning. The cause of the fire remained unknown and there were no reports of injuries to employees, firefighters, or residents.

People allowed back into homes in western Sask. village after grain elevator fire forced evacuation

09/10/2020

Topic: Evacuation order lifted after grain elevator fire in western Saskatoon

An evacuation order was released to the village of Marengo and a state of emergency announced for the rural municipality of Milton following a large fire at a grain elevator in Marengo on 8 October. Electricity had been cut to the village but was restored by SaskPower the next morning. No injuries were reported and many residents found their own accommodation, although Red Cross assistance was provided for those who asked while the evacuation order was in place. There was no estimate of the amount of property damage or what was damaged.

Argentina first nation to OK drought-resistant GMO wheat, farm industry balks

11/10/2020

Topic: Argentina first nation to approve drought-resistant GMO wheat

On Friday 9 October, Argentina was met with criticism by its export agriculture industry in response to the country becoming the first in the world to approve the use of drought-resistant genetically modified wheat. Bioceres’ BIO.BA HB4 wheat tolerates glufosinate sodium and is resistant to drought, which Bioceres argues can help boost yields during dry years. However, the Argentine government states that the product cannot be sold until Brazil, Argentina’s biggest wheat buyer, approves its importation. Brazil has not commented on the prospect of it approving the purchase of HB4 wheat. Several Argentine farm groups criticised the government’s approval of HB4 wheat, citing concerns that it could create a stigma for exporters. As no other countries have approved the importation of GMO wheat, Argentine farmers have little to no incentive to plant it, particularly given that environmental groups have warned that not enough is known about GMO crops treated with weed killers like glufosinate sodium for them to be safely consumed. The HB4 wheat variety was developed by Trigall Genetics.

Compiled 29/10/2020

US wheat inspections for China nearly triple on week

13/10/2020

Topic: US wheat inspections for China nearly triple

In the second week of October up to 8 October, the US Department of Agriculture recorded that US wheat inspections for China reached 182,382 megatonnes, up 179 percent on the week and the third highest weekly level in 2020-2021. As a result, China’s total US wheat imports since the 2020-2021 marketing season (beginning in June) reached 1.2 million megatonnes—a change from the same period last year, where China did not import any wheat from the US. Analysts show that China is committed to fulfilling its end of the Phase 1 deal with a buying spree of US agricultural products, including wheat, sorghum, and corn. In the week up to 8 October, total US wheat inspections sank 24.3 percent on the week to 514,086 megatonnes due to major importers like Japan, South Korea, and Vietnam taking a step back. Total wheat inspected for exports reached 10.4 million megatonnes from the start of the 2020-2021 marketing year until 8 October, pushing it up by 9.9 percent year on year. The USDA anticipates the US to export 26.5 million megatonnes of wheat in the 2020-2021 season.

How digitised supply chains can help multiply Africa’s crop yields

22/10/2020

Topic: Digitised supply chains can help multiply Africa’s crop yields

Financial Times writer Marianne Schoemaker examines how technology can enable African farmers to “organise themselves in a different fashion, integrate value chains to their benefit and develop their business.” Schoemaker calls for more inclusive agri value chains as they grow increasingly digitised, which would require careful data design that specifically prioritises smallholders’ interests given that the World Bank and FAO estimate that 95 percent of the world’s farmers can be classified as smallholders. Smallholders produce 45 percent of the world’s food, with 70 percent coming from sub-Saharan Africa, south and east Asia, and Latin America. Despite the dire circumstances small farmers in Africa find themselves in—facing a combination of lack of basic services and logistics, price fluctuations, and climate change—they nevertheless produce a marketable surplus. Additionally, with growing consumer awareness of where their food comes from, Schoemaker emphasises that “a digitised value chain will benefit all stakeholders in creating greater transparency about where our food comes from, while helping primary producers to access much-needed resources including finance, inputs and fair prices.” Schoemaker adds that in order to achieve better and sustainable yields, stakeholders in agritech and fintech should create a digital ecosystem that is easy to use and can deliver greater transparency, farmer insights, and access to finance. 

Eligible producers receive 100% compensation for unpaid deliveries to ILTA Grain Inc.

01/06/2020

Topic: Eligible producers receive 100 percent compensation for unpaid deliveries to ILTA Grain Inc

Eligible producers who were not paid for grain delivered to ILTA Grain Incorporated will be fully compensated through the Canadian Grain Commission’s Safeguards for Grain Farmers Program. In July 2019 ILTA Grain Inc. was put under creditor protection with the company defaulting on amounts owed to grain farmers for unpaid deliveries. 271 individual claims from producers were subsequently assessed by the Canadian Grain Commission, with 222 claims deemed eligible for over $11 million in compensation.

US Soya Bean Season Kicks Off With Strongest Exports In History

28/10/2020

Topic: First seven weeks of 2020-2021 marketing year see strongest soybean exports in history

The first week of the 2020-2021 marketing year saw the strongest soybean exports in history following years of disruption to US soybean exports due to the US-China trade war. By 15 October, the US exported 11.4 million tonnes of soybeans, an 85.3 percent jump from the first seven weeks of the previous marketing year and a 19.4 percent jump from the 2017-2018 marketing year. The jump is the result of the return fo Chinese buyers in the US market, with 77.9 percent of the 2.5 million tonnes of exported US soybeans going to China. Chinese soybean imports have risen by 15.5 percent in the first nine months of this year while Brazilian soybean exports have risen by 30.5 percent so far this year, with soybean exports from Brazil to China having risen by 25.9 percent this year compared to the first three quarters of 2019.

Recent rains revive Argentine wheat but some yield damage seen – exchange

07/09/2020

Topic: Rains revive Argentine wheat but some yield damage seen

According to the Buenos Aires Grains Exchange, while rains in early September brought much-needed relief to wheat fields in central Argentina, the damage to yields is expected to be irreversible. Argentine growers planted 6.5 million hectares of wheat to be harvested in December and January; as a result of months of extremely dry weather, Exchange analysts cut their initial sowing estimate of 6.8 million hectares.

Russian wheat prices rise further on strong global benchmarks

08/09/2020

Topic: Russian wheat prices continue to rise on strong global benchmarks

In early September, Russian wheat export prices rose again as the Russian market reflected stronger global prices in Chicago. Agriculture consultancy IKAR stated that Russian wheat with 12.5% protein loading for supply in September and from Black Sea ports rose by $5 in the first week of September, standing at $216 a tonne free on board. Sovecon, another Moscow consultancy, noted that Russian farmers sowing winter wheat for next year’s crop were increasingly concerned by the lack of rain. Sovecon went on to state that Russia’s southern regions were expected to harvest small crops of corn and sunflower, which could slow down sales of wheat and barley already harvested by farmers and who would no longer need to free up their storage for corn and sunflower.

Funds plant first bullish CBOT corn view since Aug. 2019

09/09/2020

Topic: Funds plant bullish CBOT corn, wheat, soybean views

According to Reuters, as of 1 September, investors held net longs across CBOT corn, wheat, soybeans and soybean products, and Kansas city wheat—the likes of which have not been seen since 2015. Reuters writes, “they maintain bearish views in Minneapolis wheat, though they are the most bullish toward combined CBOT grains and oilseeds for the date since 2012.” Data published by the US Commodity Futures Trading Commission noted that money managers “dumped” approximately 136,000 short positions across these seven grains and oilseeds, with the remaining total of 378,580 being the funds’ fewest number of shorts since July 2017. Funds also added about 86,000 gross long positions, the most for a week since March 2018, setting the new number of total longs at 682,851—the highest since August 2018. Hedge funds and other money managers switched to a new long in CBOT corn futures and options of 18,659 contracts in the first week of September. For soybeans in the first week of September, money managers extended their net long in CBOT soybean futures and options to 162,607 contracts from 109,288 contracts a week earlier. Also in the first week of September, investors boosted their net long in soybean meal futures and options to 15,871 contracts from 3,560 a week prior and their net long in soybean oil futures and options to 81,557 contracts from 67,690 a week prior. For wheat in the first week of September, money managers net long in CBOT wheat futures and options rose to 32,469 contracts from 1,517 contracts a week earlier. Minneapolis wheat remains the only grain approached with pessimism by investors.

French crop growers warn farms at risk after harvest setbacks

09/09/2020

Topic: Harvest setbacks have French grain growers concerned

Adverse weather conditions and insect damage led to poor harvests this year in France, putting many grain growers and some farms in less fertile regions at risk. A dry spring and summer and extensive insect damage led to a sharp drop in cereal and rapeseed production; a drop in yields in the upcoming sugar beet harvest is also expected. The French government has offered drought relief measures, proposed easing the ban on a type of pesticide used to protect sugar beets, and outlined 1.2 billion euros in support for agriculture in a larger stimulus plan following the COVID-19 crisis. For farms in less productive soils, Sebastian Windsor, head of farming advisory body APCA, warned that “‘if there aren’t rapid support measures there’ll be 15% of farmers who won’t get through this year.’” AGPB, a wheat growers group, expects that more than half of grain farmers will have record negative pre-tax income this year, adding to several years of falling income. The AGPB called for more short-term aid for farmers, including state-backed loans and tax breaks.

Brazil’s corn ethanol sector booms despite obstacles

10/09/2020

Topic: Despite setbacks, Brazil’s corn ethanol sector booms

Despite the collapse in demand for corn ethanol in March and April and record-high corn prices, Brazil’s biofuel sector is booming. Corn ethanol mills have exploded across Brazil’s centre-west grain belt over the past five years. In response, corn harvesting increased from 66.5 million tonnes in 2015-2016 to a projected 102.5 million tonnes in the current 2019-2020 season, according to Conab, the official crop supply company. Conab anticipates that the corn harvest will jump by 12pc to 113 million tonnes for the 2020-2021 season, while corn ethanol industry association Unem projects that the industry’s demand for corn could reach 8.3 million tonnes in the 2021-2020 sugar and ethanol season. Mato Grosso, Brazil’s largest corn-producing state, expanded its current 2019-2020 planted area for corn by 4.4pc to 5.4 million hectares and anticipates outdoing that with a 5pc expansion in area in the 2021-2021 season.

Soybeans rise above $10/bushel on Chinese demand, corn at 5-month peak

14/09/2020

Topic: Chicago soybeans rise above $10/bushel on Chinese demand, corn at 5-month peak

Chicago soybean prices rose above $10 per bushel as Chinese purchasing and a lower estimate for US production boosted prices. Corn jumped to a five-month peak since mid-March, while wheat ticked higher. The USDA reported that US corn and soybean production would be lower than expected due to unfavourable weather in August. Export sales of soybeans to China totalled 1.608 million tonnes at the end of the first week of September, while weekly corn export sales to China were 1.137 million tonnes. Ukraine reported 9.2 million tonnes of grain in the July 2020-June 2021 season compared to 10.3 million tonnes at the same period during the previous season.

Soybeans at 27-month high on Chinese demand, corn dips

17/09/2020

Topic: Soybeans at 27-month high on Chinese demand while corn dips

While soybeans were at their highest in September since June 2018 on the back of increased demand from China, corn dipped from a 6-month peak, the fall curbed by Chinese crop losses. The USDA confirmed private sales of 327,000 tonnes of US soybeans to China. China is expected to import larger volumes of corn due to strong demand and domestic crop losses, the latter expected to fall by up 10 million tonnes from the latest government estimates after heavy wind and rains damaged crops in major production areas in the northeastern cornbelt. On the other hand, Brazilian farmers in the north and northeast are expected to expand their soy fields by more than 6% in the 2020-2021 crop season.

Ministers seek to plug subsidy gap for struggling English farmers

18/09/2020

Topic: Ministers seek interim subsidy scheme for struggling English farmers

To prevent the collapse of thousands of English farm businesses, the Department of Environment, Food, and Rural Affairs is developing an interim subsidy scheme for English farmers in an attempt to bridge the gap between EU payments and a new environmentally based system. This interim system of environmentally based payments, likely to be called the Sustainable Farming Incentive, is projected to begin its pilot stage in 2021 and rolled out nationally in late 2024. In response to farmers’ concerns that existing plans for future subsidies do not account for food production, the subsidy will likely include payments to help boost productivity. According to George Eustice, environment secretary, this initiative comes from the determination to end EU-style payments, which are “notorious for handing large sums to wealthy landowners.” Research from Defra shows that subsidies make up 61 percent of profit for the average English farm. Almost one-fifth of farms would not meet production costs without subsidy payments. Based on 85,000 English farms that claim EU-style payments, this equals 16,150 farms unable to make ends meet. New-style subsidies will eventually be based on “public money for public goods,” where environmental work like restoring peatland or creating bird habitats will be rewarded. However, these requirements also mean that the distribution of payments among farmers may differ significantly from before.

Soybeans ease from 28-month high, Chinese demand curbs losses

21/09/2020

Topic: Chicago soybeans 28-month high eases while Chinese demand curbs losses

Chicago soybean futures broke a three-session streak of gains; however, Chinese demand limited losses. The USDA reported sales of 210,000 tonnes of US corn to China and 100,000 tonnes of soymeal to unknown destinations. Wheat is being supported by concerns over global supplies, with dryness in Argentina, Europe, and the Black Sea region being a large cause for concern. As a result, large speculators switched to a net long position in CBOT corn futures in the week of 15 September. Non-commercial traders, including hedge funds, increased their net short position in CBOT wheat and raised their net long position in soybeans, the Commodity Futures Trading Commissions’ weekly commitment of traders reported.

Compiled 28/09/2020

Global trade in food and agricultural products more than doubles in two last decades

24/09/2020

Topic: Global agri-food trade doubles in last two decades

According to a new report issued on 24 September by the Food and Agriculture Organization of the United Nations (FAO), global agri-food trade has more than doubled since 1995, amounting to $1.5 trillion in 2018. The FAO also reported that emerging and developing countries’ exports are on the rise and account for over one-third of the world’s total. Driving the rise of global value chains is income growth, lower trade barriers, and technological advancements. FAO Director-General Qu Dongyu stated: “‘Global value chains can make it easier for developing countries to integrate into global markets. As they link our food markets closely, they also provide a mechanism to diffuse best practices to promote sustainable development.’” The report found that on average and in the short term, a 10 percent increase in smallholder farmers’ participation in agriculture’s global value chain could result in an increase of roughly 1.2 percent in labour productivity. Qu Dongyu argued that efforts to include smallholder farmers in modern food value chains should be redoubled, which would require broad policies to create an environment that bolsters smallholders’ participation in global value chains, such as improved rural infrastructure and services, education, and productive technology. The report also emphasised the role agri-food markets can play in encouraging sustainable development, arguing for the promotion and application of voluntary sustainability certification schemes and standards in agriculture. When examining trends and drivers in the evolution of trades and markets, the report noted that while global agri-food trade has doubled since 1995 in real value, its growth rate has slowed since the 2008 financial crisis, which is expected to be impacted further by COVID-19. The report speculated that the pandemic could disrupt the potential of agri-food global value chains in global trade and growth. 

FBN launches free membership – and its answer to ag carbon credit markets

21/09/2020

Topic: FBN launches free membership and its answer to ag credit markets

Farmers Business Network (FBN) has launched free membership to US, Canadian, and Australian farmers, with existing members receiving a prorated credit for the value of their paid membership and which can be used in the online FBN Direct Store or used towards a Market Advisory Pro Subscription. FBN formerly charged a $700 annual membership fee. FBN currently has nearly 14,000 current members and covers 45 million acres of farmland globally. Its platform offers several services, including a seed finder with access to information on over 1,400 varieties, a “price-transparent” marketplace for chemical and seed inputs, a networking function to help farmers connect to one another, and free access to satellite imagery. While the goal of announcing free membership is for FBN to have a “bigger tent” and to emphasise its promise that its services can increase farm profitability, this announcement means losing as much as $9.8 million in income. FBN has also debuted Gradable, a grain buying and origination platform aimed at providing farmers using sustainability oriented practices with receiving premiums. Gradable is initially focused on carbon abatement, joining a number of other parties (e.g. Cargill, Indigo, Nori) who are advancing ag carbon credit markets as a solution to climate change. In response to debates around whether it is possible to sufficiently measure carbon storage and the many carbon standards being used, FBN co-founder and CEO Amol Deshpande states: “There are a lot of companies flailing around at this and a lot of charlatan behavior in that market. Our goal is work with super credible parties for a data-driven approach rather than the ethereal carbon credit.” Desphande also noted to AgFunder News that FBN will be concentrating on local and rural communities in an upcoming initiative called “FBN 2.0.”

Regenerative Agriculture, Meet Gradable

14/09/2020

Topic: FBN introduces new integrated platform Gradable

FBN introduced Gradable, a “reimagined grain supply chain that creates value for environmental stewardship.” Gradable operates as part of FBN’s focus on carbon abatement strategies, stating that Gradable pilots have demonstrated 20 percent emissions against national averages. It also aims to align the supply chain to connect its users with consumer-packaged goods companies, biofuel producers, animal feed providers, and other major grain buyers. FBN claims that “the end result of this shared effort is to both accelerate the adoption of regenerative practices and give you the opportunity to maximize your profit potential.”

BlackRock leads FBN’s $250m Series F as ag marketplace puts focus on sustainability

03/08/2020

Topic: BlackRock leads FBN’s $250 million Series F in response to ag marketplace focusing on sustainability

FBN has raised a $250 million Series F round led by funds and accounts managed by asset management giant BlackRock. Participation from other new investors included Baron Capital Group, Balyasny Asset Management, Mandi Ventures, Lupa Systems, and Au Bon Pain and Panera Founder Ron Shaich; existing funders also participated in this round, including DBL Partners, Temasek, GV, funds advised by T. Rose Price, Expanding Capital, and Kleiner Perkins. FBN co-founder and CEO Amol Deshpande has noted that sustainability and social impact experience is a top priority of the syndicate of investors. The new capital will go towards the expansion of its Farmers First FBN Direct range of inputs, featuring biologicals,  crop protection, and seed. FBN also plans to invest in its Crop Marketing and Financial Services platform, “which aims to provide the most services for farmers to manage risk and obtain financial services like loans and insurance” and to enter new markets. Among these goals, Desphande notes that the biggest challenge for FBN is the “old guard of agribusiness.” FBN filed a civil complaint that big players like Cargill, Bayer, Corteva, Univar, and BASF have used multiple tactics to keep FBN out of the market, resulting in Canadian antitrust officials launching a probe into these big players in February 2020.

Some Alberta farmers bracing for worst harvest in 18 years: ‘The damage is done’

14/07/2020

Topic: Alberta farmers prepare for worst harvest in 18 years

After heavy rains and hail storms, some Alberta farmers are preparing for the worst harvest in 18 years. Fearing financial loss, many of these farmers are looking to cash in on crop insurance to make ends meet. After a difficult 2019 growing season, established farmers fear for new farmers, who “‘can’t weather the storm.’”

Egypt’s wheat storage capacity at 4 million tonnes: official

20/07/2020

Topic: Egypt’s wheat storage capacity increased to more than 4 million tonnes

A supply ministry official told Reuters on Sunday, 9 July that Egypt’s wheat storage capacity has risen to more than 4 million tonnes, a significant increase from a capacity of 3.6 million tonnes in 2019. This announcement came days after Egypt purchased 3.5 million tonnes of wheat from local farmers, a figure up by 300,000 tonnes when compared with wheat purchased in 2019. In recent years, Egypt has been attempting to expand its capacity by building more silos. Egypt consumes approximately 20 million tonnes of wheat annually and imports close to 12 million tonnes.

Coronavirus sheds light on Canada’s poor treatment of migrant workers

20/07/2020

Topic: Coronavirus reveals Canada’s poor treatment of migrant workers

The Guardian writer Hilary Beaumont recounts the story of Erika Zavala, 35, and Jesús Molina, 36, two seasonal farm workers from Mexico who were fired for allegedly breaking government pandemic guidelines. Zavala and Molina were transferred to Bylands, a plant nursery in Kelowna, British Columbia, which had experienced a COVID-19 outbreak that ended on 11 May. Managers of the farm informed them that as part of the strict policy put in place to prevent further spread of the virus, migrant workers were unable to leave the farm or have visitors. Canadian workers were exempt from this rule. Zavala and Molina invited two migrant rights activists to their employer-provided house but were later asked by their manager to sign a letter “stating that they had broken the rules by leaving the property and interacting with people who did not work there.” Neither were given a second chance and the couple flew back to Mexico. Trudeau has acknowledged that while Canada has handled the pandemic better than most countries, in the case of migrant farm workers Canada’s action has been lacking. Many activist groups have stated that the federal $50 million grant given to employers to house migrant workers during their 14-day quarantine period does not directly benefit workers. These groups are calling for the government to grant permanent residency to workers upon arrival in Canada, which would give them the opportunity to leave abusive employers and find another job. Labour lawyer Susanna Quail said Bylands’ actions were illegal, as “employers don’t have the right to restrict employees’ movements, and firing employees for breaking a rule based on their place of origin violates the provincial human rights code.” Beaumont argues that Zavala and Molina’s case is one of the many examples of the mistreatment of migrant workers in Canada, now brought to light as a result of COVID-19.

The Cause: super-chef Dan Barber’s mission to save small farms

22/07/2020

Topic: US chef’s mission to save small farms and support the independent food movement

In the wake of 30 percent of 500 small farms in the US fearing bankruptcy due to reduced demand as a result of COVID-19, chef Dan Barber, proprietor of Blue Hill restaurant in Greenwhich Village and Westchester Country, began his “lockdown-inspired grow-your-own initiative: resourceED.” Barber’s aim was to start a global educational initiative to teach young chefs about the importance of small-batch, rotational growing. This initiative would raise awareness and emphasise the value of small farms and would operate as a way to support the independent food movement during, and possibly after, the pandemic. Barber partnered with Jack Algiere of Stone Barns Farms, who wrote a “recipe for a basic kitchen garden in a language that spoke to food lovers,” Barber said. This “recipe” dictated that a 12 x 15 plot should be divided into six suggested families of vegetables, each rotated around a six-month period and each chosen according to individual location and personal taste. The recipe is primarily grounded in diversity and sustainability.

Brazil’s soybean exports plunge 34% so far in July on tight supply

22/07/2020

Topic: Brazil’s soybean exports drop 34 percent on tight supply

In the first three weeks of July, Brazil’s soybean exports dropped 34 percent. According to S&P Global Platts, market sources have signalled that much of this drop can be attributed to farmers holding onto stocks in anticipation of a price rise in the second half of the year as a result of dry US soybean weather, which would push international soybean prices higher. However, the hoarding of soybeans has caused Brazilian ports to experience supply bottlenecks. Data released on July 20, 2020 by Brazil’s foreign trade department reveals that soybean exports fell to 4.18 million megatons over July 1-19. The country has already sold over 92 percent of its soybean crop for the current marketing year (February 2020 to January 2021) due to the weak Brazilian real. The Brazilian real has lost 43% of its values against the US dollar in the last year, making Brazilian soybeans very competitive in international markets. Brazil exported 61 million megatons of soybeans in the first half of 2020, up 38 percent on the year, with 72 percent of these shipments purchased by China.

Taranis banks $30m Series C with tech giants Hitachi, Micron among new investors 

21/07/2020

Topic: Taranis raises $30 million Series C with Hitachi, Micron among new investors

Taranis, an agricultural imaging and analytics firm, has raised $30 million in a Series C round co-led by Vertex Growth and Orion Fund. Joining the round are new backers Micron Ventures and UMC Capital and first-time investors La Maison, Hitachi Ventures, and Mitsubishi UFJ Financial Group’s VC unit. Existing investors Vertex Ventures Israel, Finistere, OurCrowd, and Viola also took part, raising Tarani’s total to $60 million. Tarani is one of many firms operating aerial observation tech via agri-drones that have come under scrutiny over recent years. Closure of the round due to COVID-19 meant pauses or pullbacks from investors, but a revived interest in agri-drones is resurfacing in the wake of COVID-19’s “new normal.” AgFunder News reporter Richard Martyn-Hemphill argues that agri-drones may be the perfect solution to social distancing and supply chain traceability and disruption challenges that COVID-19 has brought about. Taranis, whose primary service to farmers centers on pest control, boasts a “precise, leaf-level diagnosis 20 times faster than the manual alternative of a human scout walking a section of field, and with 20 times more data points.” Taranis aims to identify new pests or weed varieties for a growing range of crops, as well as to increase its percentage accuracy on those pests and weed varieties it has already documented. To facilitate these goals, Martyn-Hemphill writes, the Taranis team will have to work on affordability, diagnostic accuracy, and comprehensiveness for its investors. While the company is not necessarily headed to spraying on its own, it is likely headed to integrating its data findings with partners in retail, ag equipment, and crop protection, such as John Deere, Nutrien, Climate CORP, BASF, and Syngenta.

Farmers Business Network expands to Australia with Farmsave acquisition

21/07/2020

Topic: US-based Farmers Business Network expands to Australia with local startup Farmsave

After announcing the acquisition of local startup Farmsave, Farmers Business Network (FBN) is expanding to Australia. FBN offers a digital platform to farmers for comparing, pricing, and buying inputs for their businesses, with nearly 12,000 farmers as members of their network. Farmsave, originally based in Perth, Western Australia, offered a similar marketplace and price index for inputs. FBN co-founder Charles Baron told AgFunder News that Australian farmers face similar challenges to US and Canadian farmers in the realm of buying inputs, affected by the amount of consolidation in the industry. Baron confirmed that after acquisition, the Farmsave brand would be discontinued, although the company’s existing employees will remain in place as the new FBN Australia team. Australian farmers can now join FBN, while existing Farmsave members will be migrated to FBN’s platform. FBN aims to grow its Perth team through hires and to work on specialized product and service offerings for the Australian market, while also looking at potential future deals like the Farmsave acquisition.

Russian wheat offered lowest offer at Egypt’s GASC tender

29/07/2020

Topic: Russian wheat offered lowest offer at Egypt’s state tender

Solaris presented the lowest offer of $215.10 a tonne for 60,000 tonnes of Russian grain on Tuesday, 28 July, at Egypt’s General Authority for Supply Commodities (GASC) tender. GASC is seeking an unspecified quantity of wheat for shipment between 1 September to 10 September, using a deferred payment mechanism. In a breakdown of the offers presented in dollars per tonne on a free-on-board basis, Solaris came in with the lowest offer for Russian wheat at $215.10, followed by Posco’s offer for Russian wheat at $215.90, and Hakan and Soufflet with the highest offer for Ukrainian wheat at $219.95 and $222.75. According to traders, the best offers, including cost and freight, were recorded with Solaris offering $228.05 for Russian wheat.

COFCO, Bunge grains plants hit in Argentina after COVID-19 cases detected

30/07/2020

Topic: COVID-19 cases detected in Argentina suspend COFCO, Bunge operations

Grain operations of Chinese food giant COFCO and US agribusiness firm Bunge Argentina have both taken hits after COVID-19 cases were detected among workers. After 12 employees tested positive for the virus at its Timbues grains plant, COFCO has temporarily suspended operations. Bunge had one employee at its Puerto General San Martin facility tested positive, with those who had been in contact with the person put into isolation and tested but ultimately coming back negative. Despite the interruption at Puerto General San Martin, Bunge redirected soybean deliveries to other locations in Argentina to prevent delays and to continue serving customers. Preventative measures took place at the Timbues plant, including social distancing, temperature checks upon entrance, and the distribution of hand sanitizer and face masks.

On target? China committed to buying $36 Billion of US farm goods in 2020 as part of the Phase 1 trade deal

Topic: China to buy $36 billion of US farm goods in 2020 as part of Phase 1 trade deal

As part of the Phase 1 trade deal between the US and China, China has committed to buying $36 billion of US farm goods in 2020. China’s purchases of US farm goods tend to be heavily back-loaded in the year to align with the harvest. Currently, the original target of $36,500,000,000 in farm goods has encountered a shortfall, with US agriculture exports sitting at only $30,487,290,000.

China soybean imports from the United States vs Rest of the World

Topic: China soybean imports from the US vs other suppliers

In June, China seasonal soybean imports from non-US suppliers sat at approximately 10 million tonnes, while imports from the US sat below 2 million tonnes. Also by June, China’s total soybean imports seasonally sat at about 12 million tonnes. Between January and May 2020, China quickly received more soybean imports from other suppliers than they did from the US.

China pork & beef imports surge to a record in H1 2020

Topic: China pork and beef imports surge to a record in H1 2020

Beijing has boosted meat imports in 2020 in an attempt to fill a protein supply gap caused by African swine fever. Between January and June 2020, 2,120 million tonnes of pork and 997,000 tonnes of beef were imported, as compared to the 818,702 tonnes of pork and 697,830 tonnes of beef imported between January and June 2019 and the 647,986 tonnes of pork and 456,437 tonnes of beef imported between January and June 2018.

Russian wheat prices down under pressure from new crop, weaker rouble – IKAR

03/08/2020

Topic: Russian wheat prices fallen under pressure from new crop, weaker rouble

After three weeks of growth, Russian wheat export prices fell in the last week of July due to the arrival of a new crop and the weakening of the rouble against the dollar, IKAR agriculture consultancy told Reuters. Russian wheat with 12.5 percent protein loading from Black Sea ports was down $3 from the week before, going for $207 a tonne free-on-board for supply in August. Despite a slow start to the new season, Russian grain exports are speeding up, with Egypt’s state grains buyer, GASC, buying 350,000 tonnes of Russian wheat and 120,000 tonnes of Ukrainian wheat in the last week of July. SovEcon, a consultancy in Moscow, anticipated that despite the rainfall in parts of the Urals and Siberia improving the condition of spring wheat sowings in the area, “it was too late for any significant improvement.”

Bin-busting harvest in Canada seen adding to global wheat supply

05/08/2020

Topic: Canada anticipates adding to global wheat supply after huge harvest

According to the results of a crop tour of Manitoba, Saskatchewan, and Alberta  organized by FarmLink, Canadian wheat production is expected to reach 31.9 million metric tonnes, up 16 percent from last year and the biggest harvest in history. The data, compiled over a 12-day period in July by crop scouts, revealed that crops are “in better shape with more yield potential compared to a year earlier.” The harvest would be adding to a global glut of wheat this year. Durum output is forecast as 7 million tonnes, a 41 percent increase from the year earlier, while Canola production is forecast as rising to 20.2 million tonnes, up 8.5 percent from the year earlier.

Agriculture’s role as a wealth generator in society remains vital

19/02/2020

Topic: Discussion of agriculture as a wealth generator in society

AgDaily writer Jack DeWitt discusses the concept of land as “the source of wealth.” He starts by recalling Carl Wilken’s fight for parity prices for agricultural goods. Wilken, who studied the ratio of farm income to national income, produced 50 years of data that demonstrated how the national income increased and decreased in sync with farm income in a ratio near 7-1 (this ratio has recently been debunked). DeWitt then moves to recounting how wealth trickles up from the natural resource industries. As a result of this, DeWitt argues that while agriculture’s role as a wealth generator in a modern economy may be diminished as compared to Wilken’s largely agrarian and less complex economy, agriculture is still essential. He writes: “If our cities were destroyed in a disaster, such as an asteroid hit or nuclear war, it would be agriculture that would bring them back.”

Exclusive: Lebanon navigates food challenge with no grain silo and few stocks 

07/08/2020

Topic: Lebanon navigates food challenge with no grain silo and few stocks

A UN official and regional grain expert told Reuters that Lebanon’s government does not possess a strategic stockpile of grains, unlike most countries largely dependent on imports, and that the blast on Tuesday, 4 August destroyed the privately held stocks at its only grain silo. Fears of food shortages were exacerbated by the destruction of the silo and of the port, which meant that buyers would need to rely on smaller, private storage facilities for their wheat purchases with no government reserves to fall back on. The additional burden of banks in crisis and one of the world’s largest public debts led Economy Minister Raoul Nehme to state that Lebanon had “very limited” resources to handle the disaster. The blast brought Lebanon’s hand-to-mouth approach to food security to light, with the silo containing only 15,000 tonnes at the time of the explosion, according to Nehme. With the consumption rate of wheat around 35,000 to 40,000 tonnes a month and Lebanon needing an inventory of around three months’ supply at any time for food security purposes, the silo should have contained over 100,000 tonnes. Lebanon’s private millers are now forced to navigate new logistics quickly if the supply chain is to run smoothly. A lack of funding meant that the construction of a second grain silo of approximately 150,000-tonne capacity at Tripoli was halted, the construction of which would have made logistics much simpler in the current circumstances.

World food price index rises in July, extending rebound

07/08/2020

Topic: UN Food and Agriculture Organization report rising world food prices rise in July

In an extension of a rebound from the previous month following falls triggered by the pandemic, world food prices rose in July. The UN’s Food and Agriculture Organization’s food price index, which measures monthly changes for cereals, oilseeds, dairy products, meat, and sugar, averaged 94.2 points in comparison to a slightly revised June figure of 93.1 points. The vegetable oil price index climbed 7.6 percent in July, reaching a five-month high, while the dairy price index rose by 3.5 percent to climb above the pre-pandemic level. Sugar prices rose by 1.4 percent, whereas the meat index dropped by 1.8 percent and was 9.2 percent below the level recorded in the previous year as a result of global demand disrupting availability. The cereal index remained almost unchanged despite gains for maize and sorghum as a result of Chinese purchases from US suppliers.

‘Everything is gone’: Flooding in China ruins farmers, risks rising food prices

08/08/2020

Topic: Heavy flooding in China ruins farmers, risks rising food prices

Since June, heavy flooding has devastated much of southern China’s crops and farmland. The scale of the flooding both destroyed crops ready for harvest and made it impossible to salvage anything from this year. The Ministry of Emergency Management of China estimates the direct economic cost of the flooding at $21 billion in destroyed property and farmland, with 55 million people affected by the disaster. After only just starting to recover from the coronavirus pandemic, Beijing has had to secure food supplies by importing produce from other countries and by releasing enormous amounts from strategic reserves. Chinese officials have warned that flooding may creep further north, jeopardizing China’s wheat and corn harvests. As the Chinese government has not released specifics about the current state of production, analysts can only speculate as to how much of China’s food supply may be at risk.

Low rainfall in US Midwest drives corn prices higher

26/08/2020

Topic: Corn prices driven higher after low rainfall in US Midwest

A lack of rainfall and deteriorating crop conditions in the US Midwest have raised corn prices, with benchmark corn prices up almost 4 percent at $3.39¼ a bushel during the week of 24 Aug – 26 Aug. With sections of the Midwest only receiving 15 to 40 percent of normal rainfall, the corn crop will have to rely on existing soil moisture, which will in turn affect yields. Meteorological agencies in the US and Australia have proposed the likelihood of a La Niña later this year. Typically, a La Niña is caused by the cooling of the tropical Pacific Ocean, bringing droughts to the Midwest and California. These events can have significant and far-reaching consequences, such as during the 2012 La Niña, when the US experienced its worst drought in 50 years and grain and soybean prices surged.

Grandad’s legacy? A harvest of happiness: For shepherd JAMES REBANKS, farming isn’t just a way of life, it’s in his blood, passed down through his family for 600 years – as he recalls in our final extract from his gloriously evocative new book

27/08/2020

Topic: Extract from shepherd James Rebanks new book recounts family history of farming

Shepherd and author James Rebanks recounts the 600-year farming legacy of his family and how his grandfather inspired him to continue that legacy in this excerpt from his book.

Canadian wheat crop looks biggest in seven years, canola harvest smaller

02/09/2020

Topic: Canadian wheat crop harvest biggest in seven years

Statistics Canada announced that Canadian farmers are set to harvest the biggest wheat crop in seven years at 35.7 million tonnes, with slightly less canola. This bigger wheat production was driven by a 90 percent jump in durum output. However, traders are sceptical of the high wheat estimates, with some having stated that Statistics Canada’s modelling, which used satellite technology that incorporated data up until July 31, ended too early to record a heatwave that lowered yields. On the other hand, canola production was set to reach 19.4 million tonnes in the 2020-21 marketing year, which is smaller than last year’s 19.5 million and below the average trade guess of 20 million tonnes.

China’s looming corn shortage fans food security unease

03/09/2020

Topic: Food security unease driven by China’s looming corn shortage

Rising corn prices are increasing food security fears in China as the country heads for its first real corn shortfall in years in the upcoming 2020/21 season, potentially facing a deficit of up to 30 million tonnes, which is around 10 percent of its total crop. While this would be to the advantage of major exporters such as the US and Ukraine, it would also threaten to push up global prices. China expects a bumper 2020/21 corn crop at around 266.5 million tonnes but this is still not enough to meet demand.