What is in Store for the Global Grains Market
Demand for grain remains strong - but global stocks remain tight - so grain prices may increase again soon. The Chicago Board of Trade shows a 13-percent decrease in corn prices - but Morgan Stanley Head of Commodities Research Hussein Allidina says corn may rally to 10-dollars before this time next year since cattle and hog producers haven't culled herds as feed costs have risen. A Bloomberg News survey says corn may get as high as 8-75 a bushel before next year's Northern Hemisphere harvest. Still - with livestock producers looking to substitute other grains for feed - Allidina says wheat prices will be supported. Gainsborough Managing Director David Sheppard says it's the calm before the storm with world grain markets - as Russia and the Ukraine are running out of exportable surpluses and France is selling into recent tenders. Allidina says inventories are the tightest they have been in his lifetime - and the world can't afford anything below trend line yields in Argentina, Brazil and the United States.
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