News

January 05, 2009

A Few Small Green Shoots Of Optimism For 2009

Sally White

No one seems in any rush with their forecast for agriculture market prices in 2009! While Goldman Sachs and Barclays may be advising clients that the sector is a good “defensive” bet, citing world population growth, the silence from most “experts” is deafening after the worst 12 months for commodities in at least five decades. Goldman, however, is prepared to go for bet on a double digit gain in sugar, cotton and coffee. Barclays’ punt is that livestock and agriculture generally will prove the most robust of commodities in 2009. A more muted forecast on commodities from Standard Chartered Bank is that cocoa, 2008’s star, will go on rising.

The good news – for farmers – is that fertiliser prices at the factory gates are still falling and no one is seeing an end to this yet, although weeks of price cuts have yet to work down to retail level. Bad news for producers is that shipping’s main indicator, the Baltic Dry Index, is thought to be moving off the bottom as more ships are laid up. However, a sustained rise, showing recovery in world trade, will cheer up everyone else.

Palm oil plantation owners are talking up their commodity...