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Economy

Global Corn Production Revisions and Market Trends: Impact on International and African Markets

by Alexandra Hartman Editor-in-Chief
written by Alexandra Hartman Editor-in-Chief

2023-11-21 23:10:00

Global corn production forecasts for the year have been revised upwards. A trend which reassures the market and pushes prices down, on the international market, but also on the African continent.

Between its October and November assessments, the US Department of Agriculture (USDA), whose monthly statistics are the reference, revised corn production upwards by six million tonnes. If this is confirmed, the total harvest might increase by more than 5% this year compared to last year.

This reassessment concerns in particular the harvests in Ukraine and Russia, knowing that the American harvest which is ending is also welcomed and shows good yields. However, the United States and Brazil are the two exporters that count on the corn market.

A more generous offer

Over the past two years, production in these countries has, in turn, been more reduced than expected. The rebound observed today therefore logically increases the volumes of corn available for marketing.

« Global supply appears, at this stage, sufficient to meet the still very strong demand from the main buyer, China. », underlines Damien Vercambre of the Intercourtage firm. And when supply is adapted to demand, sources of stress decrease on the markets, with a direct impact on prices.

Their current decline is also due to Brazil which practices a very aggressive pricing policy, in particular because the country does not have enough storage infrastructure and it must export its production as quickly as possible.

Among the reasons contributing to the easing, there are also global corn stocks: according to the USDA, they might increase by 5% this year.

Fall in prices in West Africa

This tendency to see softer prices on the international market should be accompanied in the coming months by a drop also on African markets, according to the agricultural analysis bulletin N’Kalo. Thanks to above-normal rains during the winter, production is expected to be rather good in Togo, Senegal, Guinea and Mali. Good news for consumers. But also a good reason for producers to quickly sell their stock, according to N’Kalo, before prices fall further.

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#Corn #prices #guided #good #harvests

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Economy

Rising Cocoa Prices in Ghana: Impact on Planters and Strategies to Combat Illegal Mining

by Alexandra Hartman Editor-in-Chief
written by Alexandra Hartman Editor-in-Chief

2023-09-10 22:26:00

Cocoa prices, which had been rising for months, suggested an increase in the price paid to the planter for the new campaign. And in fact, the new price announced by Ghana looks much more profitable: it has been set at 20,900 cedis per tonne, compared to 12,800 for the last harvest, or the equivalent of approximately 1,100 CFA francs per kilo. An increase of 63% in local currency.

With this announcement, the Ghanaian authorities are sending a strong signal to planters one year before the presidential election. But might it be otherwise? “This very attractive price is the only way for the government to try to fight once morest the establishment of illegal mines and the flight of cocoa to neighboring countries.», Explains an expert in the sector.

Plantations coveted by gold miners

Plunged into the midst of an economic crisis, Ghanaian cocoa farmers have in recent years begun to cede their plantations to increasingly offensive gold miners in the country.

In 2022, 19,000 hectares of crops had already disappeared, according to figures communicated locally by Ghanaian officials, under the effect of this practice called “ galamsey “. An increasing practice which contributes to reducing cocoa production, already affected by heavy rains this year which accelerated the spread of “swollen shot”, the cocoa tree disease.

Ghana therefore ended its 2022-2023 campaign with 44,000 tonnes of beans which were missing to honor its contracts. The country decided to administratively close the season without waiting for the end of September, and started the news last Friday, which allowed it to announce a new price.

Waiting for the Ivorian price to rise

This communication should, as is often the case, help release onto the local market stocks of cocoa from the last harvest which were still held by the planters, rightly convinced that the next prices were going to be better.

Ivorian cocoa farmers will have to wait another three weeks to find out the new price paid locally. But the tone has just been set: Ivory Coast and Ghana generally avoid having prices that are too far apart, in order to limit illegal trade at their borders.

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#Chronicle #raw #materials #Cocoa #prices #Ghana #takes #care #planters

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Economy

Rice Price Increase Mystery: Impact on Africa and Climate Change Concerns

by Alexandra Hartman Editor-in-Chief
written by Alexandra Hartman Editor-in-Chief

2023-06-04 22:04:00

The measures taken by the Indian giant did not foreshadow such a price increase. But restrictions on the export of rice and broken rice imposed by New Delhi since last September have not had the desired effect. The price of Indian rice is now around 460 dollars per tonne for 5% broken rice – FOB price, that is to say excluding transport. A high for at least ten years, which represents an increase of 40 dollars per tonne since January, to speak only of this year, according to data from the Osiriz economic report published by CIRAD

Prices weigh on demand in Mali and Côte d’Ivoire

This increase in India reflects what is happening on the world market where prices have been climbing steadily for several months, but is nonetheless a mystery: “ supply and demand do not justify such a trend “, explains a representative of a large trading house.

Among African buyers and in particular in Mali and Côte d’Ivoire, demand has fallen: ” On the mainland, whenever the price of a 50 kg sack of rice approaches the equivalent of a month’s salary, purchases tend to fall. “, specifies our interlocutor.

On the supply side, Indian exports did not fall and those from Thailand and Vietnam increased. So if in the short term there is no lack of rice, where does this pressure on prices come from? Can inflation alone justify this increase or are there already in the major production basins harbingers of the El Niño climate disturbance, or even a kind of pre-El Niño? The hypothesis cannot be excluded, according to an expert.

► Read also : Rice prices: a grim scenario for 2023

2023 are you the menace of El Niño?

In fact, Pakistan received abnormally heavy rainfall this winter and had to reduce its exports by a third at the start of the year. Indonesia, which imported almost nothing in 2022, might buy 2 million tonnes of rice this year. Bangladesh, Nepal and Vietnam have recently shown through their purchases that they are worried regarding their supply. Thailand has truly formalized its concern and asked rice farmers to harvest only one year due to the arrival of El Niño.

The quality of the first weeks of monsoon will tell if the climatic argument is used correctly and if El Niño will truly be the arbiter of the next season.

► Read also : India bans export of broken rice

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#Chronicle #commodities #price #Indian #rice #highest #ten #years

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Economy

“Copper Prices Fall Due to World Economy; Rising Production Costs in Chile Could Lead to Future Increases”

by Alexandra Hartman Editor-in-Chief
written by Alexandra Hartman Editor-in-Chief

2023-05-28 22:14:00

The slide began in mid-April and led copper back to its November price level. On the London Metal Exchange (LME), a ton has been trading for the past few days at around $8,000, 25% less than at the peak reached last year in the wake of the invasion of the ‘Ukraine.

This fall in prices is directly linked to the moribund state of the world economy, the red metal is not nicknamed Doctor Copper for nothing! The prices are particularly linked to the health of China. The Middle Kingdom concentrates most of the copper refineries, the level of its imports therefore has a direct impact on prices.

Rising production costs in Chile

But this trend is only a facade and should not last. Structurally, the sector is faced with a drop in the content of deposits located in Latin America, and in particular in Chile, the world’s largest producer and a key player in the sector. The average concentration of minerals in Chilean deposits has fallen by 55% over the past twenty years, according to the Cyclope report on raw materials, published last week. As a result, in 2022, Chilean copper production fell by 6% compared to the average of the last decade.

Heavy investments are essential to redress these figures. In mines such as Chuquicamata, it is now necessary to fetch copper much deeper. To produce the same quantity of red metal in these aging deposits, the energy costs have become much higher.

To compensate for this drop in grades, opening new mines is one of the alternatives but ” it is difficult today to identify which sites might take over “says an expert. Not to mention the necessary investments which amount to billions of dollars and are spread over 10 to 15 years.

80 kg of copper in an electric car

This structural trend towards lower levels will inevitably support the courses adds Yves Jegourel, co-director of the CyclOpe report, and professor at the National Conservatory of Arts and Crafts.

Prices are expected to rise by 2% between 2022 and 2023, according to CyclOpe estimates. More optimistic, the banks Goldman Sachs and Bank of America foresee much higher increases by the end of the year. Especially since opposite, demand is set to grow as part of the energy transition. While it takes 23 kg of copper in a thermal vehicle, it takes 60 kg in a hybrid model and 80 kg in an electric car.

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#Chronicle #Commodities #Copper #misleading #drop #prices

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