RaboResearch In The News

April 2022

War's Impact to Linger

Roland Fumasi, Head of RaboResearch Food & Agribusiness North America, discussed physical disruptions in the Black Sea region, including the ability to produce crops in the Ukraine, with Sosland Publishing. According to Fumasi, disruptions include land mines in agriculture fields and a labor shortage as people move away from agriculture to defend their country. “It’s a big challenge right now in terms of getting a crop planted,” Fumasi said. “Even if we assume that Russia and Ukraine get some crop planted and harvested, we have a major logistical challenge.” Fumasi continued to say that if a carrier is willing to send a ship into the region, the insurance rates have been so disruptive it’s difficult for any product to leave.
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Will Shoppers React to More Expensive Dairy?

Dairy Analyst Ben Laine explained the current inflation consumers are experiencing in the dairy market and noted that he’s been a little surprised that there hasn’t been more pushback on the demand side. “To this point, we’ve been able to avoid some of those increases along the supply chain before they really hit the consumer. I think this year we’re going to see that hit consumers much more.” While there is still some optimism about pandemic restrictions lifting, the reality of those related costs could lead to a change in how consumers spend their money. “At some point, I’d say this year, we’re going to see some of those realities setting in and some choices being made,” Laine added.
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Global Pork Market Outlook: Inflation Renews Industry Focus on Efficiency and Slows Growth

Senior Animal Protein Analyst Christine McCracken explained why higher energy, freight, herd health, and labor expenses will weigh on pork producer returns over the balance of 2022. “The recent spike in energy costs will put additional pressure on an already stressed global supply chain, just as it was emerging from an extended disruption,” McCracken said. She continued discussing how the increased global uncertainty from geopolitical conflicts and a slower trade growth in economically sensitive regions could limit pork imports. “An estimated 11% of annual pork production is destined for global markets, with most export-dependent countries unable to absorb excess pork in local markets. This vulnerability could force some regions to reevaluate their relative exposure to exports and export-led growth.” 
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Walnut Health Research, Strawberry Demand Way Up

David Magaña, Senior Horticulture Analyst, spoke with Daily News Report’s podcast, “My Ag Life,” to explain the strong strawberry demand, increases in strawberry plantings, and the fruit’s high prices. “Strawberry consumption in the U.S. is a little bit more than six pounds per person per year and the consumption has been increasing over the last decade. However, the growth has not been as fast in strawberries compared to the consumption growth in other berries, such as blueberries, raspberries, and blackberries. In terms of volume, it is still the largest berry. The amount of drivers that have been relevant for years are the combination of healthfulness, convenience, and taste. And particularly for the last two years those demand drivers have become more relevant.” Magaña continued, “A year ago, we observed multi-year high prices for all berries and that was mostly demand driven, as covid-related restrictions were lifted in many places consumers went to the store on a more frequent basis.” 
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After a few challenging years, the bakery industry looks like it's in good shape. Consumer Foods Analyst JP Frossard looks at current growth drivers for the U.S. bakery industry and how they differ from those before the pandemic.

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Happy #NationalBeefMonth! Rabo AgriFinance celebrates the farmers and ranchers playing a vital role in bringing high-quality, American beef to our tables. https://t.co/QKLY0Xd6UJ

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