Agricultural markets will remain volatile

High price volatility is ongoing in agricultural markets, but recent price fluctuations don’t necessarily show it has increased, said Dr Holger Matthey of the trade and markets division of the UN’s Food and Agricultural Organisation at the Western Cape launch of the Bureau for Food and Agricultural Policy (BFAP) Baseline 2010 report.

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There are new market factors that may cause more price volatility in the future, he noted. These include the greater link between energy and commodity markets, the presence of large institutional investors in futures markets and more frequent extreme weather events, due to climate change.