Russia has exploded as a wheat exporter, tripling its sales in just a decade. By contrast, domestic consumption grew some but has been relatively stagnant the past few years. That has because the population has grown at just 0.15 percent per year and is forecast to fall going forward. Sensitive to public resistance to food price increases, the government has been using an export tax to meter how much of the nation’s wheat gets exported. Russia’s wheat stocks-to-use ratio is higher than it has been for six of the past ten years. As in other countries, the contributions to food price inflation are more diverse than just the bulk commodity value. If wheat is on average about 12 percent of the value of a loaf of bread, halving the...
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...
What You Need to Know Today: Wholesale inflation was flat in July, with the Producer Price Index (PPI) unchanged versus expectations for a 0.2 percent increase. Core PPI rose 0.2 percent, also below expectations. The softer inflation data has reduced the odds of a September interest rate incre...
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.