Written by by TYLER DURDEN at zerohedge.com
Despite the El Nino-related weather disturbances affecting key agricultural areas globally and the disruptions in the Black Sea stemming from the war in Ukraine, there is encouraging data suggesting further easing in food inflation in the new year. This development comes amid the soaring risks of food riots in emerging markets, as the weakening of EM currencies against the dollar has made staple foods increasingly more expensive for poorer populations worldwide.
Bloomberg data shows corn and wheat prices have recorded their largest annual declines in a decade. This is primarily because of bumper crops in key ag regions and might lead to further easing of food inflation into the first half of 2024.
Corn futures on the Chicago Board of Trade plunged 31% this year, and wheat contracts fell 21% – the largest annual declines since 2013. Soybeans were down 15%. This led the Bloomberg Grains Spot Subindex to slide 22.8%. This is good news for the United Nations Food and Agriculture Organization World Food Price Index, which has already come off record highs.