Corn Flat prices are low and are even lower for deferred positions. Grain sales are liquidated in Argentine pesos at the official exchange rate of about 65 ARS/USD and the only way to buy back U.S. dollars is on the black market at 120 ARS/USD. Staying long Argentine pesos seems crazy with the current inflation rate, and even crazier knowing that inflation is expected to increase substantially in the future as the country has no access to credit and the government is printing money to ease the economic situation. Given the currency situation, and the fact they have already sold a large volume of the corn crop, farmers have little reason to keep selling. There has been a large reduction over the past two weeks in the daily volume of...
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.