Want to find out what is happening in agricultural
Ask someone who knows. Which is why I am getting excited as
the minutes tick down to the start of Agrimoney LIVE.
Speakers at next week's event include big names, from the
likes of BlackRock, Monsanto, the United Nations Food and Agriculture Organization,
and the World Bank.
And that is before considering the esteemed ranks of
delegates, each of whom will bring their own take on the sector, besides an
appetite for learning more.
Although delegates will have their own individual interests,
here are five key themes which I think delegates should look out for.
1 - Volatility
Price movements on stock markets have been
unusually muted, until this week, with the Vix index, the gauge of fear,
hitting a multi-year low.
That has read through into some agricultural commodities too
– although not all, with cotton futures soaring, and falling, while other contracts
Will grain prices remain broadly rangebound? And what does
the experience of cotton show about treating ag commodities with too broad a
Answers to these kinds of themes are likely to be found from
speakers such as INTl FCStone's Jaime Nolan Miralles, CME Group senior economist
Erik Norland, and Arnaud Petit, director commodities and trade at Copa-Cogeca.
2- Supply and demand
One big influence on ag price volatility will be prospects
for crop supply and demand. The ample supplies of many crops, such as wheat, would suggest
that their prices will stay weak - not
needing to rise in encourage extra output.
But is that think too complacent? The early-May snowstorms in
the US Plains, and the slow pace of recovery in Malaysian palm oil output from El
Nino-inspired dryness, remind us of the power of weather upsets.
How many of
these can the world sustain, before shortages arise?
Look for insight from Abdolreza Abbassian, senior economist
at the UN FAO, MDA's Kyle Tapley, and Jan Lambregts, global head of financial
markets research at Rabobank.
3- Political risk
It is all very well having plentiful stocks of
a commodity in the world. But there is the question of those inventories being available
That underlines the importance of the world's political ructions,
evident in the likes of the election of Donald Trump as US president and the UK's
vote to quit the European Union (as analysed in an Agrimoney.com report
published this week).
How big are the threats to freedom in world trade in ags? How
are trade maps being redrawn – take, for example, Mexico's apparent turn, in the face of
threats from President Trump, to South America for crop supplies.
Expertise in these kind of topics is provided by the likes of the World Bank's Marc
Sadler, Michael Aubrey, partner at Mills & Reeve, and Savills' research
head Ian Bailey.
4 - Investment strategy
Taking these dynamics into account, how should investors
react? Derivatives in ag commodities are a high profile and liquid way of gaining
exposure to the sector.
But they are not the only way.
Skye MacPherson, director, natural resources at BlackRock,
will reveal the appeal of equities in the sector, while Valoral Advisors managing
director Roberto Vitón will throw light on the "hot" topic of ag sector
And a host of speakers will guide delegates through other areas
of the industry, ranging from trade finance to South African agribusinesses to
Latin American farmland.
5 - Agtech
One new theme for ag investment – in name at least – is agtech,
including its subsector of big data, which has opened up fresh ground for ag
groups to prospect in, and mine reams of statistics for trends which could open
up ground-breaking areas of research.
But what is really on the horizon for agtech? And how much
hope should investors place in big data?
Look to the likes of Monsanto's Mac Marshall and Plant
Impact chairman David Jones to map the future in this area, besides Sarai Kemp,
vice president business development at Trendlines Agtech.
I am sure many delegates will have other questions too.
Given the expertise on show at Agrimoney LIVE, I am sure they will be able to
find some answers.
I look forward to seeing you there.
Mike Verdin, editor, Agrimoney.com
For more details on Agrimoney LIVE, click here.