China to remain the key driver of the grain and oilseed market — INTL FCStone

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APK-Inform

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To date, the global market still does not function at full capacity, due to the COVID-19 pandemic. But the market started gradually recovering its previous positions, declared the Vice President at INTL FCStone, Matt Ammermann, within frames of the online-conference Grain&Maritime Days Online, on May 28.

The trend started developing due to the fact that in a long while in lockdown, many people started understanding that it is time to "return" and restore the economy. It is interesting to note that the current COVID-19 crisis has some differences from the financial crisis in 2008-2009 period, including the fact that it came out of the blue for the whole world, while the financial crisis was the long-simmering problem, the expert said.

Also, M.Ammermann focused on the fact that since the beginning of the COVID-19 pandemic, the whole globe faced some weakening of the exchange rates of national currencies against USD, due to the growth of demand for the dollar. In turn, the situation created rather favourable climate for exporters and supported the prices of many agricultural crops.

In addition, reduction of the demand for meat products due to the COVID-19 pandemic, and various quarantine restrictions imposed around the world, became another factor of the current global situation in terms of the grain market. At the same time, in such terms the market started demonstrating the slumping demand of the livestock industry for feed grains.

M.Ammermann stressed that China will remain the key driver not only on the grain market, but also in the segments of oilseeds and meat products, as we can see that the country is actively recovering from the pandemic, and the demand rates are growing respectively. However, many global experts expect for the second wave of COVID-19 in the current year, and the situation on the global market depends on how China responds to the issue. Unfortunately, until the scientists develop the COVID-19 vaccine, the market will not completely return to its previous rates.

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