Process Management

News last update:6 Aug 2012

ING Group: Grain prices +40% by 2020

A new report by ING group predict that agricultural prices will increase further by another 40% by 2020 caused by a tight supply brought on in part by increased demand for grains, a global water shortage, and changing weather patterns.

The report provides an insight into the adjustments food and beverage managers are going to have to make to their logistics systems, pricing strategies, and product development to cope with the coming crisis. ING's analysts see opportunity for large companies that are better able to adjust and leverage the inflationary environment to their advantage."The virtuous inflationary cycle is created as leading consumer goods players translate higher input prices into accelerating sales in premium brands and developing markets," the report stated.

Small and mid sized companies overall will have the most problems with input price pressure, while their positioning in regions and categories is focused too closely on western markets and products that depend on a supply of meat or grains.

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ING Group

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