Macroeconomic trade largely defined price action in the ag markets on Tuesday as higher-than-expected CPI inflation spooked markets. The U.S. CPI came in above expectations at 3.1 percent, which sent the U.S. dollar index sharply higher as it implies the Fed will have to keep interest rates higher for longer. For commodity traders, the big implication from the CPI numbers is that the U.S. dollar is likely to remain higher for longer, which will pressure U.S. grain (and meat) exports. That dynamic was on display Tuesday as wheat futures – a commodity among the most sensitive to the U.S. dollar – fell to new contract lows. Funds were net sellers for the day across wheat, soybeans, soymeal, and the livestock contracts but were mode...
What You Need to Know Today: Russia rejected calls for a ceasefire in the Black Sea, including a proposal to halt attacks on civilian shipping that could help restore grain flows from Ukrainian ports. Tyson Foods announced plans to permanently close its Joslin, Illinois, beef processing facili...
The big news in the cattle markets yesterday was Tyson Foods’ move to close two more beef plants. One of them, the Joslin, Illinois, plant was shuttered immediately after the announcement. The other, in Eagle Mountain, Utah, is a case-ready plant that does not slaughter cattle. Tyson also...
The Bureau of Labor Statistics (BLS) released the Consumer Price Index (CPI) on Wednesday. In July, the CPI rose 0.1 percent, seasonally adjusted, and rose 3.4 percent over the last 12 months, not seasonally adjusted. The index for all items less food and energy, or the “core” infla...
From WPI Consulting
Forecasting developments in production agriculture
On behalf of a private U.S. agricultural technology provider, WPI’s team generated an econometric model to forecast the movement of concentrated corn production north and west from the traditional U.S. Corn Belt. WPI’s model has subsequently provided quantitative support to a multi-million-dollar investment into short-season corn variety development. WPI’s methodology included a series of interviews with regional grain elevators and seed consultants. Emphasizing outreach and communication with stakeholders who possess intimate sectoral knowledge – on-the-ground insights – is a regular component of WPI’s methodologies, made possible by WPI’s ever-growing network of industry contacts.