The outcome of yesterday’s Brexit vote, in which the U.K. voted to leave the European Union, is having a massive impact on the financial and commodity markets, including the ag sector. Arlan Suderman with F.C. Stone in Kansas City says the vote was a surprise, as the markets had anticipated Britain would stay in the EU. As a result, the market could trade this for several days.
The other big question is what other countries will follow Britain’s lead and leave the EU? Suderman says that question is still up in the air, which adds uncertainty to the market.
He says agricultural commodities are reacting to the lower outside markets and especially the higher U.S. dollar index.
However, they will be buffered more than other sectors of the market because they are food-based. In fact, Suderman says he thinks fund traders will eventually buy food-based commodities as they pull money out of other areas and look for a safe haven.
