World Perspectives

Market and Economic Impact of Food Donations

After a week of anticipation, yesterday USDA Secretary Sonny Perdue announced that the $12 billion trade mitigation package that was expected today will instead be released on Monday. From his comments over the past month, the following is known: Payments to commodity producers will total $7-9 billion. Trade promotion funding will be about $200 million. The remaining funds will go to commodity and food purchases for donations to food banks and other outlets, which simple arithmetic indicates will be somewhere between $2.8 and $4.8 billion. Based on the above, the third-listed allocation has the biggest potential short-term market impact. Consider the total value of potential food purchases and the effect of the distribution of those...

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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.

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