Deflationary Pressures Intensify

[errolanderson]

DEFLATIONARY PRESSURES INTENSIFY: Latest robust inflationary data has now likely seen its peak. Commodities are now a steady decline. Global veg oil markets have broken their uptrend led to massive 20% collapse in soyoil. Malaysian palm oil breaking lower. Canola in-retreat. Healthy ethanol processing margins are holding corn prices up, but clock appears ticking.

Crude oil, diesel fuel and gasoline are now all in a lower trading window. $60 WTI is considered key support.

Beef prices appear to have peaked for the holiday season.

Fertilizer should retreat in 2022. Global wheat prices also in-decline led by fallout in Paris. Cdn dollar may remain under pressure with major support in 2022 may approach 75 cents U.S. Precious metal fallout led by recent silver collapse. USD (dollar) is expected to remain in uptrend. ProMarket Wire, Calgary

[bucket]

Inflation targets by Freeland and Tiff Maklem are set for 2%.

What benchmark they are using is beyond my pay grade.

I do know fertilizer went from 600 a tonne in June 2021 to 1300 a tonne in December 2021.

Deflationary pressure to what price?

[ajl]

Sadly most farmers do not believe that deflation can exist so farm input prices are the last place to find deflation. Classic cost/price squeeze that was all the rage in the 80's for 2022. Make money one year and then give it back the next. $1300 urea is definitely the suckers bet. With soil being relatively dry and soil test result good, we will only apply starter in the spring and top dress nitrogen on the good land once conditions improve. By June I think urea will be much lower than today.

[errolanderson]

Inflation targets by Freeland and Tiff Maklem are set for 2%.

What benchmark they are using is beyond my pay grade.

I do know fertilizer went from 600 a tonne in June 2021 to 1300 a tonne in December 2021.

Deflationary pressure to what price?

Politicians are lost on the deflation issue. No one wants to talk about it. Deflation can not be manipulated and it is uncontrollable. Deflation scares the heck out of banks and gov't policy makers.

[Hamloc]

DEFLATIONARY PRESSURES INTENSIFY: Latest robust inflationary data has now likely seen its peak. Commodities are now a steady decline. Global veg oil markets have broken their uptrend led to massive 20% collapse in soyoil. Malaysian palm oil breaking lower. Canola in-retreat. Healthy ethanol processing margins are holding corn prices up, but clock appears ticking.

Crude oil, diesel fuel and gasoline are now all in a lower trading window. $60 WTI is considered key support.

Beef prices appear to have peaked for the holiday season.

Fertilizer should retreat in 2022. Global wheat prices also in-decline led by fallout in Paris. Cdn dollar may remain under pressure with major support in 2022 may approach 75 cents U.S. Precious metal fallout led by recent silver collapse. USD (dollar) is expected to remain in uptrend. ProMarket Wire, Calgary

As I pointed out in the natural gas thread natural gas in the U.K. is up 40% since Dec.6. I have been watching NOLA urea futures and they were coming down but are now trending back up. Over 6% inflation in the U.S. doesn’t point to deflation yet. My son in-law is a machinist and price of steel still high and very hard to get. Companies like Cargill in High River and John Deere in the U.S. bringing in higher wage settlements again doesn’t point to deflation.

[Guest]

Only deflation we’re gonna see is the value of the looney

[helmsdale]

I still believe in the long term inevitability of deflation... That said, I sure as hell aren't seeing any right now, or the last 10+ years of my existence! Vehicles, food, housing, land, parts are all up! My take home in nominal terms has hardly budged however. It can't keep going on like this forever. My belt is running out of notches, and my back is starting to get achy.

[errolanderson]

Interesting comments from Bloomberg this morning stating $44 per barrel is long-term key support for WTI oil since 2015.

[Taiga]

Watching the diesel rack price and hoping it will come down another 10 or 20 cents. Looks like late August was the recent lowest point.

[TOM4CWB]

I’m going to start going long every time Errol posts.

No offense Errol. 🙂

It is difficult to understand... Global debt = 250T

Very likely a Global 'reset' in the works... no reason then for deflation...

Quantitative Easing... at zero% or negative interest... no deflation... everyone is too big to fail!!! Called Communism!!!!

Cheers, Merry Christmas! Happy Holidays JT... nifty how you spiked the BOC water supply with your special stock... containing the 'budget will balance itself' 2021 special stocking stuffer!!!

Don't worry... be happy!!!

[shtferbrains]

Interesting comments from Bloomberg this morning stating $44 per barrel is long-term key support for WTI oil since 2015.

Bloomberg is a Brandon cheerleader.

[errolanderson]

The central bank induced lender 'gravy train' is also over (IMO) . . . Big economic changes coming in 2022.