STB 0.00% 40.0¢ south boulder mines ltd

ubs: potash prices to crash, page-9

  1. MJS
    2,280 Posts.
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    Food commodity prices have collapsed

    YC ... I'm not sure of your background, however agri happens to be a field I work in.

    When it comes to food commodity prices, it is basically one of the simplest supply / demand equations that dictates price. High supply = lower price (normal I guess).

    The thing is this. It is close to impossible to predict supply 6 months out, let alone 12 months or longer. Why? Because apart from area planted, weather has a massive massive impact on yield (supply) and quality.

    So yes, food commodity prices are low. If China or US has poor weather events that impact (or write off) crops prices will go up. Then UBS might write an article on booming commodity prices.

    As it is, premium quality wheat is still well prices in Australia. Why? a very large portion of the national crop is poor protein this year, or downgraded to feed quality due to late rains. If you own livestock now is a good time to forward buy feed grain.

    MJS
 
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