General Comments Demand rationing markets can be particularly difficult to trade. Greater emphasis needs to be placed on factors such as basis because the threat of a potential sell-off can sometimes by gauged by the basis. For example, if basis strengthens as futures decline, that can be an indicator that the downside is limited because the cash price is unwilling to decline with futures. Consider that prior to today, soybeans, corn and wheat all uniformly declined for several days, but cash prices were stronger for soybeans. This does not create a comfortable market position for end-users of soybeans. Soybean end-users will want to be patient, but the strong basis is implying that prices could spike suddenly and that traders then could...
What You Need to Know Today: Commodities were mostly lower across the board today after yesterday’s Federal Reserve meeting hinted at a potential interest rate hike later in 2026. The dollar index reached its highest level in over a year, and a strong dollar makes U.S. agricultural expor...
Key Market Insights Geopolitical Limbo: Geopolitical risk remained a key driver across global commodity markets today. President Trump stated that the Iran memorandum of understanding is not yet final and warned that military action could resume if negotiations fail. Both sides continue w...
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.