Agricultural Commodities Price Outlook Economic Forecast

Agricultural Commodities Price Outlook

Higher energy costs will push up prices but a strong dollar weighs on the outlook

Agricultural commodity prices failed to rebound in the final quarter of 2016, dropping 1.1% year-on-year. Agricultural raw materials covered in this report had a bumpy ride in 2016 as the combination of bad weather conditions in some parts of the globe and record-high yields in other economies caused international prices to remain subdued. The outlook for agricultural commodities is a bit uncertain as volatility will persist in the coming quarters.

Prices for most agricultural products will receive support from a global reflationary environment, stronger economic growth and rising energy prices. Upward pressure may also come from the drawdown of inventories of most agricultural products this year after having accumulated stocks during a number of seasons in 2016. Commodities experts expect prices of the agricultural commodity complex to be volatile, but project that they will increase 6.7% annually in Q4 2017.

That said, risks are tilted to the downside as expectations of a persistently-strong U.S. dollar in 2017 and some ongoing volatility in exchange rates—particularly in emerging economies—should act as headwinds to a better performance in these commodities. Moreover, an uncertain weather forecast is driving analysts’ more conservative estimates at this stage. The presence of a weak La Niña in Q1 2017 will continue to influence regional weather anomalies and output. The weakness in the intensity of the weather phenomenon makes forecasting the impact more difficult. Going forward, agricultural commodities are expected to settle low for a 3.5% rise in Q4 2018.

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Agricultural Historical Price Data

2012  2013  2014  2015  2016  
Corn698.6  598.06  397.77  361.72  343.92  
Oats367.32  387.48  402.11  284.65  255.52  
Soybeans1454.53  1419.78  1250.72  936.31  968.21  
Wheat749.42  699.94  578.22  481.76  431.09  
Cocoa2390.93  2441.23  3064.48  3136.98  2893.27  
Coffee175.1  122.21  171.43  132.27  137.88  
Cotton74.43  79.63  73.38  61.47  64.13  
Sugar21.54  17.69  16.99  13.43  18.08  
Wool1088.33  1071.7  1047.33  1198.43  1293.69  

Note:
Corn prices in USD cents per bushel (bu).
Oats prices in USD cents per bushel (bu).
Soybeans prices in USD cents per bushel (bu).
Wheat prices in USD cents per bushel (bu).
Cocoa prices in USD per metric ton (mt).
Coffee prices in USD cents per pound (lb).
Cotton prices in USD cents per pound (lb).
Sugar prices in USD cents per pound (lb).
Wool prices in AUD cents per kilogram (kg).
All prices are average of period (aop).

Sample Report

Price forecasts and historical data for Energy, Metals and Agricultural Commodities

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