World Perspectives
wheat

Wheat on the March

Old habits are often hard to break, but bearish fund managers are undoubtedly becoming nervous about their short wheat positions and probably with good reason.To the extent that markets can develop habits, being bearish on the price of wheat is an example. This goes back to 2013 as the world began to produce more wheat than it consumed in the 2013/14 wheat crop year. According to USDA estimates, world wheat stocks totaled 176 MMT at the beginning of that year and reached 183 MMT at its end. They will have grown to about 255 MMT by the end of 2016/17, an increase of 72 MMT during just three annual wheat crop cycles. That is an average annual gain of 24 MMT or very roughly 10 percent.The community of managed money funds that trade in agricult...

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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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