What's New

Food security has been a constant topic in the media in recent weeks as commodity prices continue to climb following the drought in the Midwestern US. While the causes of this most recent commodity price spike seem clear - negative weather in the US and South America impacting crop yields, as well as decreased export sales from some of the world's largest exporters - a new tool provides insight into another potential factor in food price spikes and price volatility: the media itself.

Global maize markets are currently experiencing a period of excessive price volatility. This is the first such period since June 2011 and can be largely attributed to conditions in the Midwest United States, which is experiencing the worst drought in 56 years. The United States is the world's largest maize exporter.

Global soybean prices hit an all-time high on Monday in the wake of continuing hot, dry weather across the US Midwest. In addition to pushing prices higher, the drought and subsequent declining soybean stocks and lower expected exports are also causing a period of excessive price volatility in the commodity. It is the first time such a period has been seen for soybeans since December 2010.

The latest USDA World Agricultural Supply and Demand Estimates has been released, citing sharply lowered US production and supply estimates for both corn and soybeans. The reduction in US supplies is expected to impact global supplies and trade as well.

Global soybean production is projected at 267.2 million tons, a decrease of 3.9 million tons that can be attributed largely to lower production in the United States. US soybean exports for 2012/13 have been reduced 115 million bushels to 1.37 billion.

Global maize and soybean prices have skyrocketed in recent weeks and experts fear that price increases will be unabated as dry weather in the US Midwest continues for at least another week.