February 8

2/8 – Are we at the beginning of another commodity super-cycle? Consider the numbers. In feed grains, corn futures ($5.48/bu) are up 44.1% from a year ago and soymeal ($430.50/ton) is up 49.8%. Poultry prices are still cheap, but how much longer can producers absorb those feed-cost increases? In wheat, Chicago soft futures ($6.41/bu) are up 14.1% and Kansas City hard futures ($6.25/bu) are up 32.0% from a year ago. Soybean oil futures ($.4466/lb) are up 42.6%. In proteins, lean hog futures ($70.97/cwt) are up 24.3%. Cattle futures are still below a year ago, but cattle herd adjustments take years. In energy, gas and diesel are below year-ago levels, but crude futures are up 12.0%. So far, China has been the big global price driver. But there is a lot of pent-up consumer demand in the U.S. The 2nd half of 2021 will see further, stimulus-driven commodity price inflation.