It is too late for agricultural stocks or hedge funds to escape to record highs.

From cotton to wheat, from corn to soybeans, the high supply of agricultural products flooded the market, and it was too late for hedge funds to escape.

Bloomberg News quoted the US government as saying that bumper harvests of global agricultural products and a slowdown in market demand would push combined stocks of corn, soybeans and wheat to record levels. This prompted hedge funds to reduce their long positions in agricultural products for five consecutive weeks.

Global financial markets have become more volatile, with the Bloomberg agricultural index, which tracks the prices of eight agricultural products, down 15 per cent this year. The index's 60-day volatility hit its highest level since 2012 last week.

"We have seen recent volatility in the farm market," said Paul Springmeyer, senior portfolio manager in Bank of America's private customer service division. Most people are trying to reduce the risk of their portfolios, and one way is to just avoid it. "

Combined options and futures positions in 11 agricultural products fell 21% to 183929 lots in the week of Aug. 18, according to CFTC. The cumulative decline in the five-week figure is an astonishing 67%.

There is a steady supply of agricultural products flocking to the market. In France, grain supplies are so large that even warehousing operators say they have no room to store grain. In South America, a sharp devaluation has spurred local exporters to increase exports, such as sugar and coffee, to earn a strong dollar. In North America, as mentioned on Wall Street, the USDA unexpectedly raised its forecast for domestic soyabean and corn production this month, saying that US corn production in 2015-16 would be the third highest in history. Stocks of corn, soybeans and wheat will grow for the third year in a row.

At present, the factor most likely to change the outlook for agricultural supply is the El Ni ñ o phenomenon. But it is hard to say that this climate phenomenon will be good or good for agricultural prices. The Australian Meteorological Office said last week that El Ni ñ o was on the rise. It could bring too much precipitation to the main agricultural producing areas of South America and could plunge the land areas of Asia and the Pacific into drought.

According to NBC, Mike Halpert, deputy director of the Oceanic and Atmospheric Administration's Climate Prediction Center, said this year's El Ni ñ o weather phenomenon may be the strongest since records began in 1950. All computer models predict that a strong El Ni ñ o will peak in late autumn or early winter this year.

"Commodity investors are under a lot of pressure right now," said Kelly Wiesbrock, portfolio manager at Harvest Capital Strategies. The change in market factors is not big enough to cause a substantial correction in the market. "

The decline in agricultural prices reflects the general trend of weakness in commodity markets. The Bloomberg commodity index is down 16% this year, and more than half of the 22 commodities tracked by the index have fallen into a bear market.