Peru: Cereal and soybean close 2020 in the clouds and threaten livestock profitability

Published Jan 2, 2021

Tridge summary

The prices of cereals and soybeans, crucial raw materials for animal feed, surged in 2020, reaching a 30% increase for soy and a 15% rise for common wheat since July. This trend threatens to reduce the profitability of livestock farms, as animal feed costs account for 60-70% of production expenses. The rise in these commodities is attributed to lower supply and speculation, and if the trend persists, it could result in significant financial strain for the farming sector, especially in Spain, where the Ministry of Agriculture has already noted significant feed price hikes. The agricultural sector is facing challenges, including market uncertainties and the need to balance the burden of increasing costs across the production chain.

Disclaimer:The above summary was generated by Tridge's proprietary AI model for informational purposes.

Original content

The prices of cereals and soybeans - essential raw materials for animal feed, one of the main production costs - have closed 2020 by the clouds, after a year marked by rebounds, especially since the summer, and already threaten to decrease the livestock profitability. Industry sources express their concern about the impact that this situation may have on the income statement of the farms, if it is maintained over time, because the shortage of this input is not generally accompanied by better prices at origin to the producer. According to the latest data (week 52) from the Spanish Cereals and Oilseeds Trade Association (Accoe), soy is now 30% more expensive than in July. Common wheat has become almost 15% more expensive in just six months; corn, +17.35%; barley, +19.23% and durum wheat, the one that did the least, but with a rise of 6.41%. If the monthly report on the estimation of feed prices prepared by the Ministry of Agriculture, Fisheries and Food is analyzed -with data as of ...

Source: PEefeagro