farmerm
Member
- Location
- Shropshire
With our food commodity prices becoming increasingly driven by global supply and demand events we can expect ever increasing volatility in our domestic values. Short term volatility may be some stock traders dream but its not good for investment confidence in industries that operate over long terms like agriculture.1 stuck ship, in the suez canal, has caused a rise in oil price. The world relies on a system of 'just' in time deliveries, try going to your tractor dealer, and ask for a spare part, it's, it will be here tomorrow, or it's in germany, 48 hours delivery.
No one carries large stocks of anything any longer, the bean counters have worked it out, stock doesn't earn money, sat on shelves in dealers yards, s/mkts, computer reads sales, those sales are then sent to central depots, which then compute which shop needs what, robot sorted to lorry, then to store. It takes very little to upset that chain, snow, floods etc, multiply on a global scale, then breakdown, piracy in indian ocean, illness, terrorism, strikes, embargoes etc, all interfere with delivery times, delays cost money. Everything has been worked out to the n'th degree, all the slack has gone. It would take very little to disrupt those supply lines, then it definitely supply and demand prices. And that is the big problem for farmer, we are a long term industry, trying to cope in a short time world, the two don't mix well.