We have maintained our soybean forecasts out to 2021, and expect prices to average moderately higher than spot levels in the coming years. The global soybean market will register small deficits as global demand growth, led by China, remains steady. By contrast, global supply growth will slow due to reduced growth in plantings and yields.
We have revised our price forecasts lower due to above-expected European production in 2017/18 and now anticipate that prices in 2017 will average around 2016 levels. Beyond 2017, prices will peak in 2018 as global market surpluses decline, before averaging slightly lower in the longer term as market surpluses expand slightly.
The US dollar's trend remains bearish across the board, but is looking increasingly oversold and is trading increasingly cheap relative to real yield differentials. As such, we hold a relatively neutral view at present. We continue to expect the MYR, PHP, and MXN to outperform relative to EM FX. We have also adopted a view of COP outperformance given the improving fundamental and technical...
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