Prices of agri commodities could hit new highs from severe El Nino weather

AGRICULTURAL commodities could come under intense price pressure and greater volatility amid supply risks, as the El Nino weather phenomenon kicks in and ravages crops such as sugar, cocoa and rice across the world.

However, market observers believe there is little risk – at least for now – of countries imposing protectionist measures to safeguard their domestic supply of these crops.

The global supply of several agricultural commodities – including key crops such as wheat, corn, cocoa, sugar and oilseeds – typically falls as a result of drier weather associated with El Nino.