Wednesday, October 27, 2010

FT article on soya/corn prices - 2.5m acres more US corn needed to meet demand next year

Article by market insider - head of commodities research at Morgan Stanley. 

Demand outweighs supply in soya/corn commodity markets - sort of obvious - but he says the balance is much finer now than in past - less spare capacity, and then quote: "Growing domestic demand for livestock and ethanol, together with growing export demand, supported by robust income growth in emerging markets, will require US farmers to plant at least 2.5m more acres of corn next year, and this to simply keep balances steady at today's tight levels."  

This in turn will push out US Soya production, forcing Soya prices up.  High soya prices needed from market view to incentivise Soya expansion in Mato Grasso. 

 2.5m acres = about 1m hectares. 

Keyword(s): ethanol
Frequency: Daily at 00:00 London Time
October 26, 4:41pm
Don't blame the speculators for rising soya prices
Corn, soyabean and wheat prices, have rallied markedly over the last several months. The impact is being felt by consumers facing higher prices at the supermarket, companies whose margins have been squeezed and policymakers in emerging economies who are having to deal with sharply higher food inflation.As is often the case, some are blaming the participation of speculators for these moves higher.
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Councillor Andrew Boswell
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Biofuels are a wide range of fuels which are in some way derived from biomass.

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