Global grain prices are set to drop this
year after reports of good harvest from across the world, according to analysts
at Capital Economics. Rising production and large stocks have sent prices of
corn, soybeans and wheat down by more than 40 percent from their 2014 highs, they
said.
The USDA recently bumped up its estimate
for grain production around the world, based on good growing conditions in the
US and Europe. That will help push prices even lower into next year.
In Europe, wheat production is projected
to set a new record, with French, German, and United Kingdom crops much higher
than last year, according to the USDA. Since France and Germany are the biggest
European exporters, those bumper crops are forcing global prices lower.
That helped push world food prices last
month to their lowest since August 2010, as prices of all major food groups
except meat dropped, led by a sharp drop in dairy prices, according to the
U.N.'s food agency. higher costs were the result of the ongoing drought in
California, along with brutal winter storms and freezing temperatures in the
Midwest.
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