9th week: The Road Ahead

The International Energy Agency predicted oil demand will grow at a slower pace. It is because the world economic growth rate is expected to slow, and the world oil demand as well. Meanwhile, global oil supply is increasing; however, there is uncertainty of Hurricane Sandy effect and Euro crisis. Thus oil price tends to fall or constants for a while.

Corn

I expect corn price will increase. The Environmental Protection Agency (EPA) says that it will keep in purchasing greater than a third of the nation’s corn to be converted into ethanol and blended into gasoline, so the demand for using ethanol will affect the price will go up. Also corn demand will remain high due to the animal feedstuff in China. The country needs 180 million tons of feedstuff this year which is 65 percent is made of corn

Wheat

I expect wheat price will go up. Russia, one of the world’s largest wheat exporters confront a supply deficit. The government plan to reduce the supply shock for domestic consumers, so it is trying to sell 1.25 million tonnes of wheat this year from its 5-million-tonne. But still wheat market is competitive. I think wheat price increase.

http://www.foxnews.com/world/2012/11/13/oil-falls-as-iea-predicts-demand-will-grow-at-slower-pace-next-year-due-to/

http://www.capradio.org/news/npr/story?storyid=165287910

http://www.china.org.cn/business/2012-11/18/content_27149412.htm

http://www.reuters.com/article/2012/11/14/grain-russia-idUSL5E8M74W020121114

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