A new vision for agriculture
momagri, movement for a world agricultural organization, is a think tank chaired by Christian Pèes.
It brings together, managers from the agricultural world and important people from external perspectives,
such as health, development, strategy and defense. Its objective is to promote regulation
of agricultural markets by creating new evaluation tools, such as economic models and indicators,
and by drawing up proposals for an agricultural and international food policy.
A look at the news

Drastic fall in global agricultural prices...
until the next reversal

September 21, 2015

The FAO recently announced a record monthly decline in global agricultural prices since 2008––an average drop of 5.2 percent between July and August. This represents a severe slump in prices for the milk, pork, beef and grain sectors, which are already depressed.

More precisely, the August 2014 FAO food price index was 212 for meat, 200.8 for dairy products, 182.5 for grain, 166.6 for vegetable oil and 244.3 for sugar. The August 2015 FAO price index for these same products fell to 172.9 for meat, 135.5 for dairy products, 154.9 for grain, 134.9 for vegetable oil and 163.2 for sugar. With its index plummeting by 9.1 percent in August, the dairy sector was the hardest hit.

The problem lies with an abundant supply explains the FAO. For instance, the outlook for global crops set by the FAO is 2.54 billion tons, or 13.8 million tons over 2014, which already was a boom year. In addition, other factors have contributed to the decline, especially falling energy prices and concerns generated by the Chinese economic slowdown and its negative consequences on global economies and financial markets.

Such drastic decline is a new severe blow for farmers, who are already feeling the full brunt of the liberalization of global trade, without any safeguard to tackle the elimination of milk and sugar quotas in Europe, or the increasing number of free trade agreements such as the transatlantic partnership. The situation is all the more anxiety provoking since the financialization of agriculture and the excessive upward and downward volatility as well as the existence of exogenous factors do not permit to set sustainable long-term projections.

Agricultural prices are not protected from a sharp reversal leading to a sharp rise in agricultural commodity prices, with the disastrous socio-economic consequences we experienced in 2007-2008.

In this new unpredictable and unstable environment, it thus seems essential to have more realistic decision making tools that are capable to ease the understanding of agricultural market operations. It is with the same goal that the momagri model was designed and developed by our think tank.

Page Header
Paris, 19 June 2019