WPI Spotlight

  • January 4, 2017
    Agribusiness can refer to virtually every commercial activity from crop and livestock production to... Trends and Agribusiness
  • November 3, 2016
    The All India Poultry Exporters Association wants the government to either ban the importation... India's Biotech Decision

Spotlight

Wheat's Loss to Corn and Soybeans

The ability of scientists to introduce genetic traits from outside sources into common agricultural crops (GMO crops) has caused more controversy during the last two decades than any other factor related to agriculture. One notable exception to the GMO revolution in crop production has been wheat.

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Insufficient Evidence of Economic Harm

The U.S. Environmental Protection Agency (EPA) today denied requests from several governors and the livestock industry to waive the Renewable Fuel Standard (RFS). EPA received more than 30,000 comments on the waiver request. WPI predicted that EPA would deny the waiver based on the structure of the Agency's request for comments, which evaluated the following:

(a)  Whether compliance with the RFS would severely harm the economy of Arkansas, North Carolina, other states, a region, or the United States;

(b)  whether the relief requested will remedy the harm;

(c)  to what extent, if any, a waiver would change demand for ethanol and affect prices of corn, other feedstocks, feed, and food;

(d)  the amount of ethanol that is likely to be consumed in the U.S. during the relevant time period, based on its value to refiners for octane and other characteristics and other market conditions in the absence of the RFS volume requirements; and

(e)  if a waiver were appropriate, the amount of required renewable fuel volume appropriate to waive, the date on which any waiver should commence and end, and to which compliance years it would apply.

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Post-Election Predictions

It was a status quo election from the standpoint of political control in Washington, but that does not mean that things stand still or can now move forward. There are many nuances to how policy will play out, or not, in the year ahead before the 2014 midterm elections.

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Unintended Consequences

The hue and cry over the ethanol use mandate in the U.S. Renewable Fuel Standard (RFS) and the possibility that the Russian government might intervene in that country's wheat exports have caused us to reflect on the relationship between governments, market prices and the free movement of goods from where they are available to where they are needed and wanted. These are weighty topics that periodically appear in one form or another. Whenever they do appear with enough critical mass to affect markets and trade, we usually rise up to complain philosophically about the concept that governments can allocate resources better than markets can. And we complain about the inevitable unintended consequences whenever governments attempt to control and manipulate markets and trade. There are always unintended consequences.

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Dissecting "A Mediocre Farm Bill"

"A Mediocre Farm Bill," featured in the Sunday edition of The New York Times, opined on the Senate's version of the 2012 Farm Bill. Just for fun, we took a look at some of the key points made in the editorial and added some context to the issues raised.

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Macroeconomics and Market Fundamentals

It is the most basic of truisms to say that differences of opinions are required to make any market work successfully. The ups and downs of market prices reflect how those differences are weighted at any given point in time. Based on the price action of grain and soy futures markets over the past 12 months or so, there have been plenty of such differences reflected in the choppy price movements. If one could somehow remove the price impact of the South American drought -- which is impossible to do, of course -- it probably would not seem as though market price action reflected a gradually lower trend even though prices of grains and the soy complex chopped about in a rather wide price band.

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WPI Spotlight

  • January 4, 2017
    Agribusiness can refer to virtually every commercial activity from crop and livestock production to... Trends and Agribusiness
  • November 3, 2016
    The All India Poultry Exporters Association wants the government to either ban the importation... India's Biotech Decision