Rabobank, Agri Commodity Markets Research, May 2021
Agri commodity prices have taken a tumble so far in May, dropping by 6% on average, with grains leading losses. US weather has improved permitting quick plantings and that, together with expanding corn acreage expectations, has led to heavy fund profit-taking.
Still, with a weak US dollar, persistent inflation concerns, Brazil’s burnt safrinha and a lengthy northern hemisphere weather market ahead, funds could revisit their decision to sell so soon.
In the meantime, commercial buyers have been content to pick up major coverage on the recent price break. On the fundamental side, we have low supplies in G&O exporters and a lot of weather risk still to go before good yields materialize.