Due to the continuing harmful effects of El Niño, Malaysia's palm oil production has been greatly affected reducing output by millions of metric tons.
El Niño is hitting on cane productions especially in Asia, leading to a global shortage and the rise in prices. This would be the first year of sugar shortage after years of surplus. The shortage is projected to be prolonged to at least next year.
CHS has warned crop growers regarding the approaching hurdle in the US agricultural economy. The net farm income across the US is expected to drop to $54.8 billion in 2016 owing to surplus production.
Malaysian palm inventories dropped to an 11-month low during February as poor weather spoils crop harvest. Palm production fell 3.5% to 1.09 million tons, the lowest since the period 2011 January.
Brazil, the world's number one coffee grower and exporter, has been hit by El Nino from last year, affecting the coffee crops and harvests. The weather has affected prices expectations and investors moves, as demand rise and supply declines. Coffee bean prices rise has been seen in Brazil.
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