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‘Mistakes’ in global commodity markets: farm crisis, soft options and oof!

Farm crisis

In the weeks since the Russian invasion, West Midlands dairy farmer Ed Hemming has slaughtered 26 cows, Sam Chambers said in a statement. Sunday Times – a tenth of his flock. The unplanned destruction was a sad but frankly economic decision caused by “chaos in global commodity markets”. While the fertilizer and fuel bills needed to sustain Hemming’s herd “almost doubled overnight,” he reports that “the price of culled cattle has gone up,” due to high demand for meat. from McDonald’s and other stores. “I am draining my cows to generate quick cash to cover the bills.

Soft option

Should you try to trade soft (or already large) commodities like grains? David Rodeck and Benjamin Curry mentioned above Forbes Advisor. Since market prices can spike and drop quickly, you need to have a high risk tolerance to “suffer short-term losses in pursuit of long-term profits.” A safer option is to check the managed farm fund. Another way is to look at stocks that benefit, directly or indirectly, from rising agricultural prices. It worked for me, Ian Cowie said in Sunday Times. I purchased Archer Daniels Midland (ADM) – one of the largest distributors of agricultural products in the world – in 2016 for $42 per share. The value of the stock has now doubled to about $85. Another good bet is tractor manufacturer Deere (DE), whose prices jumped from $194 last August to $388 last week.

Oh!

For proof of how quickly sentiment can change in commodity markets, you only need to look at this week’s “strong sell-off” in energies and metals, Dominic Frisby said. Moneyweek.com. Oil fell sharply from a high of $140 a barrel last week to nearly $100 on Wednesday, taking in gold, palladium, copper, aluminum and iron ore. “Don’t try to understand it.” The base case for higher metal prices remains: “even without this war, years of non-investment led to a shortage of supply.” But the speculative spikes created by “panic and frenzy” have now given way to “washout”. The only question now is “where do prices find their floor”.

https://www.theweek.co.uk/business/markets/956115/mayhem-global-commodities-markets-experts-view ‘Mistakes’ in global commodity markets: farm crisis, soft options and oof!

Fry Electronics Team

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