Rabobank Releases Annual Commodities Outlook
By Amanda Brodhagen, Farms.com
Global agricultural markets are expected to shift from a squeeze to a surplus in 2013, according to Rabobank’s annual commodities outlook titled “Outlook 2013 – Rebalancing on a Tightrope”. While it’s projected that the shift from squeeze to surplus will occur, prices will continue to remain volatile. The volatility will be especially evident for the grain and oilseed sectors.
The price squeeze is expected to take place in the first half of 2013 and is anticipated to ease off in the second half. The combination of low global inventory levels will make prices more susceptible to volatility. At this time, global stocks of corn, wheat and soybeans will rise 1.9 points and will remain lower than 2011/12 levels. Soft commodities including – sugar, cocoa and cotton will be stable heading into 2013. Grain and oilseed prices are expected to be the most volatile, with soymeal expecting to show a week performance. Rabobank forecasts that the world GDP will increase 3.75% in 2013, sustaining demand while stocks rebuild. The lack of inventory will leave the market more vulnerable to volatility.
Commodity Sector Forecasts Breakdown:
Cocoa – Cocoa prices are expected to be slightly higher in 2013
Coffee – Coffee prices are expected to increase – given global demand and stock levels
Corn – Corn prices are expected to fall 24% in Q1. However, despite the bearish outlook, the beginning of 2013 is expected to see the price rise
Palm Oil – Palm Oil prices are expected to rise in Q1 2013
Soybeans –Soybean prices are expected to remain the same in Q1 2013
Soymeal – Prices are expected to drop at the end of 2013 as demand slows
Soil Oil – Soy oil is forecasted to remain rangebound at the beginning of 2013 and is expected to increase by mid-2013
Sugar – Sugar prices are forecast to ease 5% in the next year, and are expected to reach a net surplus
Wheat – Wheat prices are expected to rise in Q1 and fall by Q4
Rabobank releases its commodity markets outlook every year, seeking to forecast price trends that will impact the global agricultural commodity sectors.