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Iowa State economist Chad Hart attributes higher oat and coffee prices to severe weather over the past year. He notes that western US droughts that began in 2020 led farmers to plant less oats and harvest about 40% less in 2021.
The piece also discusses soybean oil demand for renewable diesel and the policy and energy-price factors that could drive a future biofuel boom.
Lower oat supplies from drought keep oat prices firm for feed buyers. The soybean oil biofuel outlook is a longer-term factor that depends on policy and crude prices.
econ.iastate.eduJan 4, 2022After 68 past bullish weather events, Oats moved a median -0.8% over 5 sessions (47% higher; middle half -3.6% to +3.9%), and -0.3% over 20.
Moves of each commodity's benchmark from the last close before the event. Historical reads pool past events of the same kind; they describe what happened, not what will. Not investment advice.
