Economists at FarmDocDaily point out in an article entitled, “World Market Conditions Suggest Set-Asides Not an Effective Farm Policy for Corn and Soybeans” that U.S. farmers have been losing market world share to South America. They correctly note that the current discussion about using a paid set-aside to reduce production will not concurrently raise farmgate prices because it will simply incentivize increased production in other countries. However, it also doesn’t make sense to continue producing a crop that is uncompetitive and simply gets stored as carryover. This is particularly evident in corn where excess stocks have been building at an average 12 percent per year. While paid land diversions would be counterproduc...
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.
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...