Virus Fears Weigh Down Grain Futures
Soybeans plummet overnight
Coronavirus Sends Food Prices Soaring in China
Chinese food prices in February surged 21.9% from a year earlier, outpacing January’s 20.6% gain.
This was the highest level since April 2008, when food prices jumped 22.1%.
Chinese pork prices rose 135.2% in February from a year earlier.
In January, pork prices jumped 116% from a year earlier.
Rampant food supply shortages, due to transportation restrictions and production suspensions amid government measures to contain the coronavirus.
Chinese residents hoarding food also helped drive up food prices.
China has struggled to rein in stubbornly high pork-price inflation, stoked by a deadly bout of African swine fever (ASF), which has decimated China’s hog herd.
FBN’s Take On What It Means: We believe that skyrocketing Chinese food price inflation amid a national food supply shortage can be a positive for the US farmer. To help slow rises in food prices, China has been actively and aggressively buying US pork and poultry. We believe that increased Chinese export demand helps provide an incentive to support expanding broiler and hog expansion.
French Wheat Exports Keep Rising
Farm office FranceAgriMer increased its forecast of French soft wheat exports to 12.7 million tonnes (MMT) from 12.6 MMT.
This marked the sixth consecutive monthly increase to the forecast.
FranceAgriMer kept its estimate of soft wheat stocks at the end of the 2019/20 season on June 30 at 2.4 MMT.
Reduced animal feed demand offset the higher export forecast.
Forecasted 2019/20 French corn ending stocks were increased to 2.3 MMT.
FBN’s Take On What It Means: We believe that the 2019/20 French wheat export program has been a neutral to negative event for the US farmer this year as a small SRW crop has helped slow US exports.
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