Coagro Corp: How does Global Surplus affects your Importation

miércoles, 19 de julio de 2017

How does Global Surplus affects your Importation

The amount of prime material sold worldwide will affect your sales and buys.

International trade gives sustain to the global economy. As the world’s largest importer, US can be accounted as one of the main reasons this trade has remained so stable. For example, in 2014 over two trillion dollars were spent just from importing products to the United States (products like clothing and crude oils). Now, what happens when a product is in high demand worldwide? The direct consequence is an increase in its production, further causing exporters to have a hard time in the market. This excess is called global surplus.

What happens to the imports when a product is facing global surplus? First, the prices are unstable due to the increased demand, making the product face a serious problem when sold. Let’s take sugar as an example. This field of the market is passing through global surplus this year, and the 2017-2018 international crop will beat demand by a margin of 2.7 million tons, which is the expected quota. This drastic increase will pose a challenge to sellers.

Global surplus might look like an opportunity to put your products on the market, but it’s actually the opposite of that. Futures prices of the product are likely to drop during this period and setting for importers a down time for sales. As you can see, the commodities market is, generally, the one that gets more affected by the global surplus, which is why investors choose to stay quiet in their trades.

Be wise while handling global surplus on your imports. You can consider this period as a chance to maintain a constant, non-excessive pace, on the sales. Check the tides of the market and stay up to date to ensure things go well for you and your products. Are you in the look for the best imports in the market? It doesn’t matter if times are not proper, Coagro Corp offers top service out there. Get in contact with them to get only the best for your industry!