Loss of production stats increases market volatility

A coalition of agricultural trade associations met with top economist of the US Department of Agriculture to discuss attempts to save the reports issued by the Census Bureau.

 

The trade groups – including the North American Millers’ Association, the American Soybean Association and the National Cotton Council – hope the USDA will start reporting some of the data in its releases. That looks unlikely, however, as the department has budget problems of its own.

 

The Census reports include data on US production of wheat flour and consumption of cotton. They also estimate soybean meal and soybean oil production and how much soybean oil is being used to produce biodiesel.

 

Within the USDA, federal forecasters use the data to calculate monthly supply and demand estimates that can have a dramatic impact on prices for agricultural commodities. Analysts warn loss of the data will add to volatility in agricultural markets.

 

Industry groups will likely need to step up to cover more of the costs themselves if they want to save the reports, but their budgets are also tight. Industry members were pessimistic about the chances for saving the reports due to the budget cuts.

 

The reports are headed for extinction this summer and autumn, with the soy data going away after August.