Excess Agricultural Stocks Causing Investor Anxiety

Excess Agricultural Stocks Causing Investor Anxiety

Gold Silver Reports – With the country’s excess agricultural stocks beginning to drag on global commodity prices, the Chinese government has been forced into an overhaul of its farm subsidy program in an attempt to reduce supply and boost demand.

But a slowing economy may complicate matters, and there is speculation that Beijing will move to export some of the excess crops, prompting fears that global agricultural commodity prices will be pushed down even further.

China currently holds approximately 250 million tons of grain stocks, according to a report by the U.S. Department of Agriculture released earlier this month, with corn in particular in oversupply. The department said in its February global supply and demand estimates that China’s corn stocks are expected to reach 111.49 million tons at the end of the 2015-16 production year, up 11% from the previous year. The amount is enough to meet about half its domestic demand. – Neal Bhai Reports

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