Commodity News Service Canada – North American farmers hoping for weak commodity prices to right themselves could be waiting for quite a while, according to one of the speakers at the Cereals North America conference going in Winnipeg this week.
Dan Basse, president of AgResource, said currency issues are making life very profitable for farmers in South America and the Black Sea region.
Delegates heard the Brazilian Real has lost roughly half its value versus the U.S. dollar, which continues to dominate the basket of currencies around the world.
This has caused many producers outside of North America to “disregard the low prices being seen in Chicago” and continually plant more area of corn, soybeans and other grains, said Basse.
“2015/16 world grain stocks are a record large 501 million metric tonne;, it’s a world awash in grain and soy,” Basse said.
He said the U.S. and Canada’s share of the world wheat trade (2015/16) is at a record-low 26 per cent. “Somehow everyone needs to work together to get our wheat trade working back up,” he said.
Basse forecast world wheat trade will be down by four million tonnes in 2015/16, as world demand is showing signs of slowing.