Written Commentary
Ag Market View for Apr 24.24
April 24, 2024
Welcome to October 2021 edition of the Ghost In The Machine.
This edition covers a wide range of topical issues, from ‘regenerative agriculture’ through dry freight shipping, grains and sugar supply and demand outlooks, central bank tapering, risk management trends to China’s regulatory clampdown and property sector woes.
‘Regenerative’ is an ‘en vogue’ buzzword these days, particularly in respect of Agriculture, but all too often it is yet more ‘greenwashing’ – so what does it mean in real practical terms, where are the risks and opportunities? Sugar markets have had a good year, so what are the prospects for the new season, in terms of supply in key producers Brazil and India, and how uncertain is the demand picture?
Expectations for the global Wheat harvest are being dialled back due to weather induced harvest delays, and what in quality terms looks to be a European poor crop, we take a look at how this is impacting Paris Milling Wheat futures. The pandemic’s supply chain disruptions have moved skyrocketing ocean dry freight container rates into the mainstream, above all in terms of inflation risks, so what have and will be the key drivers going forward. As much as VaR (value at risk) has long been at the centre of risk managers’ assessments, it is anything but perfect, and many have started to look at incorporating EVT (Extreme Value Theory) to try and better anticipate so‐called ‘fat tail’ risks.
As the Fed and other major central banks start to consider tapering QE measures, what impact will this have on equity markets. China’s raft of regulatory interventions in so many sectors of its economy continue to send shockwaves through markets, foster doubts about its economic outlook, while its property sector woes are reviving concerns about the nebulous world of metals transit finance.
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