The cornavirus has meanwhile infected all agricultural and raw material markets. Panic is spreading because the possible effects of a global pandemic on the economy and trade cannot be estimated.
“Due to the rapid spread of the corona virus, agricultural markets are driven solely by negative market sentiment and not by the fundamental data of supply and demand,” says a US market analyst.
Impact of COVID-19 on Agriculture
Prices for grain and oilseeds on the futures markets already fell significantly on Thursday . In the USA, pork was also down sharply. Agricultural prices are thus following the further drop in crude oil and energy prices. And also today, the grain and oilseed markets in the US are showing deep red signs in pre-exchange trading . This will also pull prices in Europe down on today’s trading day. They also had to give up on Thursday.
In addition, the agricultural markets no longer perceive positive or fundamentally good news: for example, that container trade in China is gradually starting up again and that global trade flows are slowly picking up speed again. Certain prices on the US stock exchanges fell to new lows on Thursday. US wheat plummeted along with the stock and energy markets to their lowest level in two and a half months.
It was the worst week for the global equity and commodities markets since the 2008 financial crisis. Hopes that the coronavirus epidemic would be over in a few months and economic activity would normalize quickly were dashed.