2021 began with an increase in Corn and Soybean prices in the main global markets.
Michele of the CLAL.it and TESEO Team describes the causes in the following video.
The average prices of Corn and Soybean in January have increased significantly in the main global markets. Specifically, in the United States the price has increased by +16% for Corn and by +14.4% for Soybeans, compared to December 2020.
The increase in overseas prices of these two agricultural products is also affecting the main European and Italian markets. The average prices quoted on January 21 in Bologna are: 225 €/Ton for national Corn for zootechnical use and 498 €/Ton for national Soybeans.
These bullish trends increase the costs related to livestock feeding for farmers.
What are the main reasons for these increases?
The supply of Corn and Soybean seems not able to meet the global demand.
In January, USDA revised downward the stocks of Corn and Soybean, respectively -1.8% and -1.5% compared to previous forecasts. At the end of the 2020/21 season, the stocks of these two agricultural products are estimated to decrease by -6.3% for Corn and -11.6% for Soybean.
The global production of Corn and Soybean was also revised downward compared to the December forecast, by approximately 10 million tons of Corn and 1 million tons of Soybeans.
The main causes of this revision are the drought in South America and the lower US harvests.