Rising world commodity prices

IN his farm income review for 2007 and outlook for 2008, IFA’s chief economist Con Lucey said the factors underlying the rise in world commodity prices in the past year are set to continue in 2008.

He said these include the growing demand for food, particularly in Asia, the impact of climate change in reducing food production capacity in some regions of the world, and competition for land from bio-energy production, driven by high oil prices and government environmental objectives.

Mr Lucey said in 2007, farmers in two sectors, dairying and cereals, benefited from the strong world commodity prices but beef, lamb and pigmeat prices did not rise, and pig producers especially have been hit by a price-cost squeeze.