It was another elevated day in the agricultural commodity markets. New contract highs were set in soft-red wheat, lean hogs, December corn, July Malaysian palm oil, Dalian July soyoil and canola. As the markets stair ladder higher, pullbacks for profit-taking quickly get bought. The fire is spreading into new crop contracts with the realization that the market tightness has long legs, thus impacting the spread trade. Open interest shows the flow of new funds into the market and governments are stepping up their subsidy plans to try and spur higher production outcomes. However, subsidies cannot fix near-term problems like the dry season, shallow water in the Parana, expanding drought areas in the Northern Hemisphere and possibly Down...
From WPI Consulting
Communicating importance of value-added products
Facing increasing pressure to quantify the value of export promotion efforts to investors, a U.S. industry organization retained WPI to develop a quantitative model that better communicated the importance of exports. The resulting model concluded that value-added meat exports contributed $0.45 cents per bushel to the price of corn, increasing support for that sector’s financial support of WPI’s client. In addition to serving the red meat industry with this type of analysis, WPI has generated similar deliverables for the U.S. soybean and poultry/egg industries.