Introduction

Agricultural stakeholders can be potentially impacted by a variety of global and local factors they need to take notice of and proactively plan for. As mentioned earlier, primary production is an activity that is part of a value chain and operates within a local and global economy. Farmers’ production decisions are based partly on their expectations about future yields and prices.

Macroeconomics is the study of how the aggregate economy behaves. Macroeconomic variables, including policies related to the money supply, governmental budget deficits, exchange rates, trade, and foreign aid now play a greater role in determining farm prices than they did three or four decades ago. Many agricultural markets have become more international in scope. Any changes in the macroeconomic environment will have an impact on the agricultural sector. These variables can be analysed through the analysis of certain economic indicators. These economic indicators are used by economists to predict future economic activity.