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G RAI N M AR K E T P R O S P E C T S
September 2016
Market movements
THYS GROBBELAAR
SENIOR GRAIN ANALYST, SENWES GRAINLINK
THE OBJECTIVE OF THIS ARTICLE IS TO PROVIDE A BROAD
MARKET OVERVIEW SINCE
THERE IS QUITE A LAPSE OF
TIME BETWEEN THE WRITING
AND THE PUBLICATION OF
THIS ARTICLE.
INTERNATIONAL FUNDAMENTAL FACTORS
Graph 1. USA yields in bushels per acre.
International economic situation
The international economic situation
has not changed significantly since
the writing of the previous article.
The global growth rate is under pressure and the world’s second largest
economy, China, is changing from a
mainly production oriented economy
to a mainly consumer oriented economy. The result is a decreased demand
for various commodities, which inturn puts pressure on the international prices thereof.
Dollar/euro exchange rate movement
Most international export quotations
relating to grains and oilseeds are
done in $/ton. A strong dollar results
in relatively expensive grain, which
in turn results in lower demand and
further pressure on prices. The dollar
weakened by approximately 7% since
the beginning of 2016 against some
of the more important currencies
such as the euro. It supports some of
the most important soft commodities
to some extent.
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Graph 2. American yellow corn price on CBOT (c/bushel).
Graph 3. R/$ exhange rate movement
OCT/NOV 2016 • SENWES Scenario