#1 Macro & Business Insights
💡 Markets Update and Food Market Overview
Hey you,
Enjoy the research of the week and have a nice week 😀
My research will cover the follow points:
How inflation is continuing to be a dominant theme
Why PBOC will continue its accomodative stance to support growth
What could be the trigger to stop the FED, crush economic growth or live with inflation
How important is for Europe to invest in LNG import capacity over the days
The situation is not the best in the markets. The volatility is present and uncertainty as always in these periods is present. Research and caution are extremely important in my view.
The markets obviously are suffering, the growth is slowing mainly worldwide, and the inflation is high (even if we have some indicator like PPI that inflation could slow down).
In Europe the situation doesn’t seem to be stabilized and central banks are tightening the economy and probably they won't stop easily in the short terms.
Below, I tried to summarize this situation after read 3 recent international papers and made my thoughts.
A period of steady growth and inflation is over.
New world of heightened macro volatility – and higher risk premia for both bonds and equities.
Central banks are rushing to raise rates to contain inflation that’s rooted in production constraints. They are not acknowledging the stark trade-off: crush economic growth or live with inflation.
After many unexpected twists and turns, inflation has continued to be a dominant theme, fueled by tight labor markets, supply chain dynamics, and geopolitical tensions.
The deceleration in growth reflects a move into a more sustainable expansion in both developed and emerging markets.
Inflation across developed economies has become more persistent and broad-based, though the contributors to price pressures vary by region.
Energy prices will remain the dominant reason for elevated Euro area inflation as supply risks from the Russia Ukraine war persist.
Restrictive monetary policy is on the radar for most central banks, though the pace of tightening remains dictated by the regional inflation and growth mix.
PBoC will continue its accomodative stance to support growth in the face of COVID-19 disruptions, though it is likely past the majority of its rate cuts.
Earnings strength in developed markets will support both prices near-term and our conviction of global alpha in the coming years.
Europe will have an acute need for more fossil fuels from outside Russia to meet its energy demands and achieve its ambitious plans to reduce its reliance on Russia.
Greater imports of liquefied natural gas (LNG) (such as from Qatar, U.S., Australia and West Africa) will be needed.
Europe will also need to invest in LNG import capacity.
My research will cover the follow points:
How the Food market is going to evolve over the years
Why the war in Ukraine is causing insecurity and malnutrition in the country
How much the market can be expected to reach as value in the future
How food’s production is increasing due to demographic
Here you'll find an overview on food market.
Let’s say that the situation in Ukraine is more complicated than we thought at the beginning.
And food market is surely been touched.
In these research you'll understand why we need to produce more food (50% more over the next thirty years to feed the 10 billion people expected to inhabit in the planet in 2050) and how could be important the increase trend of plant-based food.
Impressive is even how proteins is expected to reach 880 million metric tons consumed and the value that the market is going to value all of that.
Global dollar sales of plant-based meat grew 17% in 2021 to $5.6 billion.
Plant-based meat, egg, and dairy companies raised $1.9 billion in 2021, bringing total investments in such companies since 1980 to $6.4 billion.
In 20 years, 35% of global meat consumption will come from cultivated meat products.
The global consumption of proteins is expected to grow by 2035 with a CAGR of +3% in the period 2020-2035 reaching about 880 million metric tons consumed.
The market can be expected to reach a value of approximately $290 billion in 2035.
Morgan Stanley & Co. Research estimates that the global food system will need to produce 50% more over the next thirty years to feed the 10 billion people expected to inhabit the planet in 2050.
The global food system will need to reinvent itself over the next 30 years to produce 50% more food and help 2.5 billion people escape malnutrition, while simultaneously reducing carbon emissions by 14 gigatons.
The current war in Ukraine is causing extensive loss of life, massive population displacement and significant food insecurity and malnutrition in the country.
Soaring prices of fertilizers, energy, and other inputs, gives much cause for alarm as it increases consumer prices, imperiling food security.
Best regards,
Alessandro
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Disclosure
This material is not intended as an offer or solicitation for the purchase or sale of any financial instrument. This material has been prepared for informational purposes only. Any forecasts contained herein are for illustrative purposes only and are not to be relied upon as advice or interpreted as a recommendation.