• Commodity production and trade provide the primary livelihoods for millions of households throughout the developing world. The development of this sector is essential to poverty alleviation efforts and overall economic development. However, as witnessed in recent spikes in the price of wheat and soybeans, the commodity sector is challenged by severe price volatility and high marketing costs. Many believe that commodity exchanges provide a way to mitigate these risks and increase economic efficiency in a liberalized market environment.

  • The World Agricultural Supply and Demand Estimates (WASDE) report provides monthly comprehensive forecasts of supply and demand for major U.S. and global crops, supplied by the USDA. Crops covered include wheat, coarse grains, rice, and oilseeds. This report can explain past and current global commodities trends, as well as predict trends for the coming year.

    Download the January report below. For more information regarding the WASDE reports, visit http://www.usda.gov/oce/commodity/wasde/

  • With more and more emphasis being placed on trade liberalization, global agricultural markets are facing increasing interdependence. Commodities exchanges in particular are becoming more closely linked as traders draw on information generated both domestically and internationally.

    In order for trade liberalization to be fair and effective, there must be a clear understanding of how these markets are linked so that regulation can be coordinated across countries. Appropriate regulation is key in preventing excessive price volatility and food insecurity.

  • The global food crisis of 2007–08 was characterized by a sharp spike in the prices of most agricultural commodities, including staple grains. High world prices were transmitted to domestic markets, eroding the purchasing power of urban households and particularly the poor. In dozens of countries, high prices sparked demonstrations and riots. A number of countries, including Argentina, India, Russia, and Vietnam, responded by restricting rice and wheat exports in an attempt to keep domestic prices from rising.

  • The dramatic surge in food prices in 2007–2008 seriously threatened the world’s poor, who struggle to buy food even under normal circumstances, and led to protests and riots in the developing world. The crisis eventually receded, providing some measure of relief for citizens in the countries that were most affected by the price surge; yet the FAO’s recent statement that global food prices reached a record high in December 2010 has raised the specter of another crisis.

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