Agri Commodity Markets Research March 2022: Breaking Bread

Grain and oilseed prices soared in March, driven by the ongoing war in Ukraine, which shows little sign of de-escalating. At present, Ukraine exports are blocked, while Russian exports are heavily disrupted. CBOT Wheat reached a record high in March, as – in addition to the supply shock caused by the war – US drought conditions in the Southern Plains provided further support for high prices. Since early March, peace talks have provided the market with some recent optimism. However, in our view, these talks are unlikely to be productive and the war will continue to provide support for global vegetable oil and grain markets. As supply concerns grow, high prices will not necessarily incentivize higher production given sky high fertilizer prices.

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