Global food prices to stay low in 2017: Rabobank report

High global stock levels expected to keep food prices low during 2017, however, Donald Trump presidency may bring currency uncertainty that will translate into volatile food prices, Rabobank said in its Agri Commodity Market Outlook for 2017 here.
The record-high stock levels are set to keep worldwide food prices low during 2017 even as inflation starts to rise in many developed economies, according to the report from Rabobank, the global food and agribusiness bank.
Following the election of Donald Trump as president-elect earlier this month, Rabobank is cautious on the outlook for the US.
Trump presidency brings currency uncertainty, which will translate into volatile food prices, while elections in Europe add further unpredictability, it said.

Staple food commodities like wheat, corn and soybean - key part of livestock diets across the world - are being stored in record volumes, weighing on the prices which are expected to be paid to farmers next year.
Rabobank highlights the role of China in creating further uncertainty in the market. The world's most populous country has huge stocks of many key commodities, with estimates suggesting that it holds 60 per cent of global cotton supplies, over half of corn, 40 per cent of wheat and 21 per cent of soybean.

If China decides to begin selling some of these reserves, this could depress global prices of commodities including cotton, sugar, corn, soybeans and vegetable oil, it said.

Stefan Vogel, Rabobank's head of agri commodity markets, said, "After three years of declining prices and extreme weather wrecking crops in many important agricultural regions, 2017 looks set to bring some much-needed stability to food prices. Nevertheless, record global stock levels mean prices are likely to remain stubbornly low - good news for consumers but less so for the world's farmers."
Rabobank predicts that volatility in the global currency markets will move agricultural commodity prices during 2017, with the euro likely to depreciate as a result of French, Dutch and German elections during 2017.