The market dynamics of the agricultural commodities can mostly be analyzed using – among the several available tools – the relationship between the available quantities (supply) and their usage (demand) through a full campaign or in a specific time. With specific regard to durum wheat – particularly in areas with a well-developed and relevant processing industry – the item “consumption” in that balance has historically been considered inelastic or scarcely elastic with respect to production, thus giving the latter the role of the main variable in determining both, the price trend and level.
Market dynamics of durum wheat prices
The map of the main durum wheat producing countries points out by itself a prominent geographical concentration with global production cropped – on average – bat around 45% between North America and the EU, up to 70% considering other key producers in the Mediterranean basin as well. This feature can typically unleash very pronounced market volatility when production differs from users’ expectations and needs, even in just one or few of the fundamental areas.