In 2022, incipient dryness in the U.S.’s Northern and Central Plains will combine with high input and fertilizer costs to threaten yields for grains like wheat and corn. Growing biodiesel and ethanol demand will put pressure on soy oil and corn supplies, according to Dutch bank Rabobank in its report, Hell in the Handbasket.
Food inflation is likely to remain in 2022 and may go back to the five- or 10-year average, as commodity prices are supported by inflation in the general economy, including high shipping costs (astronomical for containers), energy and fertilizer prices, as well as a shortage of labor in many countries. Urea prices in the U.S. Gulf, for example, are up 272 percent year-over-year (YOY, posing questions about how much fertilizer will be used in places where farmers do not have access to finance or struggle financially.
Global container prices are up 240 percent YOY (and 583 percent higher vs. two years ago), posing major headaches for the t