July data shows that the ag trade situation has been a drag on inflationary pressure, mostly through dropped earnings from exports. Total export prices declined 0.5 percent, mostly driven by general farm commodities (down 5.3 percent) and, specifically, soybeans (down 14.1 percent). USDA will release its latest monthly forecast for food inflation later this week, and it will be instructive. In July, the broad category of “all food” items was adjusted down to an expected 0.75-1.75 percent annual inflation rate for 2018 and projected to be 1.5-2.5 percent for 2019. Food at home, which is about 58 percent of total domestic consumption, was the deflationary driver, and every category except for sugar and sweets was steady or adjust...

TAGS – North America