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Conflicting data over the past few days about the agricultural sector’s performance stems from two measures: the agricultural economy and confidence levels in the sector. The Agbiz/IDC Agribusiness Confidence Index has proven to be a good indicator of how the agricultural sector will perform in future. Data from both variables show a disconnect lately. Confidence among agribusiness is deteriorating, while the agricultural economy (GDP) shows robust growth. After registering 38.7% quarter-on-quarter growth in the second quarter of 2017, the agricultural economy grew 44.2% in the third quarter. This was much higher than market expectations of relatively modest growth of about 20%. Good agricultural output in the 2016-17 production season, which in turn boosted trade, may have caused it. After deteriorating to 54 points in the third quarter, the confidence index declined to 49 in the fourth quarter. A reading of less than 50 points indicates contraction in agribusiness activity, which ...

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