Interesting Conference Call on Market Outlook

[charliep]

Just got off a conference call with Informa Economics and thought I would highlight some of my take home messages.

1) Uncertainty of the impact of Iowa weather/flooding issues on US corn production. Analysts compared to 1993 but noted that crop is actually in the ground in 2008 (albeit struggling). US corn prices not likely to move too far from the $7 to $8/bu range until these questions answered.

2) Cost of gain in a world of $7 to $8/bu corn is needless to say high. Having said that, current US fed cattle futures at $1/bu also at high levels. Can cattle prices stay up here?

3) Translation of higher food prices into North American consumer decision making. Higher food prices also have to be put into the context of higher energy costs and an economy that is struggling in many areas of the US/Canada.

4) Impact of all the above on inflation and governments attempst to deal with.

[jensend]

on bnn this morning an analyst with the royal bank of scotland predicted that american equity markets will collapse in or by september. he also noted that the it is only narrow parts of the economy (energy and some food costs) that are inflationary. housing and opther sectors are seeing deflation. the tsx is being supported because it is so heavily weighted by energy so in a way the higher it goes the more damage to the rest of the economy by higher energy costs. i think food producers should also be keeping a wary eye on the rest of the economy. while food is obviously a staple a weak economy is less than healthy. the other factor is that energy costs are such a high proportion of modern agriculture production costs.

[charliep]

I should actually read before I hit send. Fed cattle futures above $/lb (not the bu quoted). October 2008 cattle futures closed at close to $1.12/lb.

[cottonpicken]

The dow did crash,you just didnt see it.

The dow is priced in dollars,the dollars have lost over 40% in four years.

The best performing exchange in the world is in zimbabwe.

Inflation is funny.