Best of the Week

Agricultural Foods Price Changes Since Feb 2002

Commodities / Agricultural Commodities Oct 31, 2007 - 01:31 AM

Best Financial Markets Analysis Article Preparing comments on any investment topic day before FOMC announces U.S. interest rate policy is probably a futile gesture. That the announcement comes on Halloween provides an opportunity for cutesy comments which will be avoided. However according to the UN FAO, the world consumed 18.774 million tonnes of pumpkins, squash and gourds in the latest reporting year.

Sorry to Halloween enthusiasts, but pumpkins are not a separate reporting classification. That level of consumption is 19% over the previous five years, and is part of the reason your pumpkins cost more each year. Higher prices for Agri-Foods is not an unusual condition any longer.

This week's chart shows the price performance of some of the more important Agri-Foods. At the bottom of the chart the S&P is shown, and it does indicate an increase though rather insignificant in comparison to the others. As has been reported in previous writings, wheat prices have risen dramatically. Right behind it is barley. Farmers switched as much land as possible to other more exciting grains this past year causing barley to be scarcer. Beer consumers should not worry as no brewers have reported that production will be cut due to the supply of barley. Extensive planting of corn for ethanol consumption was overly enthusiastic, pushing price down until recently.

Agri-Food prices may have individual situations in any one crop year, but the global shortage continues to dominate. Price is always the indicator of market equilibrium. As the chart shows, prices are telling investors that the world is generally short Agri-Foods. Investors attuned to these price signals have benefited, and will likely benefit for a decade or more.

By Ned W Schmidt CFA, CEBS

AGRI-FOOD THOUGHTS are from Ned W. Schmidt,CFA,CEBS, publisher of Agri-Food Value View , a monthly exploration of the Agri-Food grand cycle being created by China, India, and Eco-energy. To review a recent issue write to agrifoodvalueview@earthlink.net

Comments

Post Comment (Moderated)

Subject:

Name:

E-mail address (will not be published):

Comment:

Commenting Issue - If on submitting you are returned to the main Index Page (50% chance) then your comment has not been accepted, Follow below steps for 95% chance of comment being accepted.

Click your browser Back button (from main index page).
COPY your comment text from Comment box (i.e. copy to clipboard).
Press PAGE Refresh - You should see the message "You are not authorized to carry out this operation"
Paste your comment back into the comment text box.
Click Submit - If everything goes okay you will remain on the article page with the message "Your comment was held for moderation and will be reviewed shortly".
If instead you are again returned to the main index page then repeat 1-5, alternatively EMAIL to comments @ marketoracle.co.uk quoting the article number.

The Market Oracle is a FREE Financial Markets Forecasting & Analysis web-site.
(c) 2005-2011 MarketOracle.co.uk (Market Oracle Ltd) - Market Oracle Ltd asserts copyright on all articles authored by our editorial team and all comments posted. Any and all information provided within the web-site, is for general information purposes only and Market Oracle Ltd do not warrant the accuracy, timeliness or suitability of any information provided on this site. nor is or shall be deemed to constitute, financial or any other advice or recommendation by us. and are also not meant to be investment advice or solicitation or recommendation to establish market positions. We do not give investment advice and our comments are an expression of opinion only and should not be construed in any manner whatsoever as recommendations to enter into a market position either stock, option, futures contract, bonds, commodity or any other financial instrument at any time. We recommend that independent professional advice is obtained before you make any investment or trading decisions. By using this site you agree to this sites Terms of Use. From time to time we promote or endorse certain products / services that we believe are worthy of your time and attention. In return for that endorsement and only in the cases where you purchase directly though us may we be compensated by the producers of those products.