The price of wheat falls by more than 3%, while corn declines by 1.5%.

The ton of corn was trading at $208 per ton on the Chicago Mercantile Exchange after a 3% daily drop on Thursday. Corn fell 1.5% in the same market and was trading at $164 per ton.

These are the lowest prices since 2020. The pandemic had accelerated demand for commodities, while the war between Russia and Ukraine caused a significant decrease in supply since Ukraine is one of the world’s main producers of these commodities.

Economies like those of Paraguay, Brazil, and Argentina also depend on the prices of agricultural commodities and represent a significant portion of total exports and GDP.

Lower prices translate into fewer exports, fewer dollars, and lower GDP for the year 2024.

The agricultural sector is often a key driver of rural development in LATAM countries. Fluctuations in wheat and corn prices can impact investment in rural infrastructure, agricultural technology adoption, and overall rural development efforts.

China is the largest importer of agricultural commodities, including wheat and corn, to meet its food and feed demand.

A slowdown in China’s economy, which is happening now, is leading to reduced demand for these commodities, resulting in lower prices globally. Latin American countries that heavily rely on agricultural exports may experience decreased export revenues due to lower demand and prices for wheat and corn.

In the last few years, the second-largest economy in the world has grappled with a multitude of challenges. These encompass a record decline in real estate, mounting debt, a declining birthrate, and a shrinking workforce.

As a result, countries in LATAM, primarily Argentina and Brazil, have experienced a significant economic stagnation phase.