Yesterday’s USDA WASDE report surprised the market to the upside and the bullish reaction carried over into the open today. Having a surprising August WASDE report is not unusual but having one lean bullish has been rare of late. The weather was sketchy in 2017 and the December corn contract had rallied 5.25 cents going into that year’s August report in anticipation of a sizeable USDA cut in output. Instead, USDA kept the numbers relatively stable, and the result was a 15.25 cent plunge in December corn. The situation repeated in 2019 when USDA opined that corn acreage, yield and consequently production were well above the market’s pre-report expectations. Corn went down the daily limit as a result. Then in 2020, a powerf...
From WPI Consulting
Forecasting developments in production agriculture
On behalf of a private U.S. agricultural technology provider, WPI’s team generated an econometric model to forecast the movement of concentrated corn production north and west from the traditional U.S. Corn Belt. WPI’s model has subsequently provided quantitative support to a multi-million-dollar investment into short-season corn variety development. WPI’s methodology included a series of interviews with regional grain elevators and seed consultants. Emphasizing outreach and communication with stakeholders who possess intimate sectoral knowledge – on-the-ground insights – is a regular component of WPI’s methodologies, made possible by WPI’s ever-growing network of industry contacts.