Brazilian companies will enjoy an improvement in share price performance as concerns over the 'weak flesh' scandal temporarily abate, but the scandal exposes long-running corporate governance concerns that will make future appreciation a challenge. North American companies will continue to integrate downstream to mitigate.
Global potash production will edge higher in the coming years, as low-cost producers look to gain market share following the bottoming out of prices in 2016. Rising production capacity will keep the market in oversupply in the coming years.
Brazilian companies will suffer in the wake of the 'weak flesh' scandal that has rocked the country in recent weeks and we no longer expect share price outperformance against US-based competitors. However, US companies will continue to suffer from weak retail meat prices and concerns over trade opportunities.
The availability of agriculture, forestry and livestock residue will be an essential driver of growth in the biomass power sector over the coming decade, with mature biomass markets set to slow as they will face obstacles to ramping up biomass feedstock production to cater additional demand.
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Thanks, BMI Research