Agricultural commodities hit by bad weather

THE increasing focus on climate change and extreme weather conditions is for good reason; and we are currently seeing how it is impacting the agricultural commodity markets.

In June, Brazil faced its worst drought in almost a century which crippled its agricultural infrastructure. A severe lack of water not only restricted irrigation but also resulted in power blackouts due to the country's strong dependence on hydroelectric power.

In mid-July, unusually cold weather brought frost conditions onto key agricultural regions, with some areas even witnessing a few nights of rare snowfall. Industry experts have assessed the damage to production to be so severe that it may impact harvests for the next three to four years.