A Mixed Bag in the Agricultural Market: Corn Hits a New Low Since 2020, Argentina Restricts Beef Exports for 15 Days
Driven by the abundant corn harvest in Brazil and the upcoming corn harvest in the United States, the futures price of corn in Chicago has reached its lowest point since December 2020. Argentina, one of the world's largest beef exporting countries, has temporarily suspended beef exports for 15 days due to currency depreciation and accelerated inflation.
Due to improved weather conditions boosting corn growth, Chicago corn futures fell 2.9% on Tuesday, August 15, reaching the lowest point since December 2020.
Grain analysts say that despite a difficult start for corn in the United States this year, the recent cool and wet weather has helped with pollination and development, which will help farmers recover some of the losses caused by previous weather conditions.
With record corn harvests in Brazil and expectations of a bountiful harvest in the United States, corn futures prices have already dropped by about 21% this year.
In other news related to agricultural products, Argentina, one of the world's largest beef exporters, has temporarily suspended beef exports for 15 days due to currency devaluation.
An Argentine customs spokesperson stated that all beef shipments have been halted, and meat processors and the government have reached an agreement on new price levels. The statement reads:
Export permits will not be issued until an agreement is reached.
The Argentine government is preparing for rampant inflation to further accelerate. The cash-strapped government has depleted its US dollar reserves to defend the peso, causing an overnight devaluation of 18%. The Argentine government is currently working to prevent rapid and widespread transmission of currency devaluation to local food and fuel prices.
Argentina and neighboring Uruguay are competing for the position of the world's largest beef exporter, so political figures in Argentina are closely monitoring prices. The Argentine government has long banned the export of seven popular cuts of beef among the local population.
Even before the currency devaluation, the market expected domestic beef prices in Argentina to rise in the coming months.
Argentina is one of the countries with the highest inflation rates in the world, with inflation exceeding 100% for six consecutive months since February of this year.
