Black clouds before the dawn. farm costs right across the primary sector remain high and prices for other primary exports have dropped. In its latest commodity outlook report, Rabobank says lamb prices continued to fall through July and are now approaching a five-year low. At the same time, the beef schedule has taken a hit and global dairy prices are also falling.
Production growth is slowing down – which is what we need to see for markets to reset– but the rate of growth for the first half of 2023 has exceeded our expectations. Milk supply growth was 7.5% YOY in the first half of 2023, with a slowdown in Q2 vs. Q1.
Rabobank says while markets are weak and times are very challenging, the current environment according to several economists as a super cycle downturn.
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