Rabobank: Grain Markets Are Struggling

It’s hard to find a lot of optimism in the grain markets these days.  Stephen Nicholson, global sector strategist for grains and oilseeds at Rabobank, said it’s unfortunate that the gloom may stay in the markets for a while.

“I think we’re in this for a couple-three years unless we have some sort of weather event, some sort of policy issue that changes the trajectory of the markets, or the money flow changes," Nicholson said.  "People decide that they need to get back into commodities, and so they start buying commodities rather than selling them. But it is going to be a tough situation to see that change anytime soon, at least in my mind, at least in the short term and immediate term. We know, longer-term, that agriculture has cycles, and it will come back. It always does. And I would say, one thing, if there is a big of a silver lining is that those cycles seem to be happening a little faster rather than longer. It’s been about ten years since we’ve had the last down cycle, but if you look before that, they cycle was a lot longer. I think that’s the one thing to think about is those cycles are going to be a little bit shorter going forward.”

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