Part Six: Making Sense of Crop Reports
So far in this series, we have covered the basic fundamentals that make up the grain and oilseed markets. Everything from the establishment of the markets to the growth stages of the crop itself has been discussed. Understanding the fundamental make-up of these markets will help you formulate your own idea as to where the price may head in the future.
So after you do your homework, who do you compare notes with? The USDA and its agencies prepare reports that are crucial to governmental policy makers and individuals that are involved in making important decisions about marketing and investing in these markets. These reports are considered to be a benchmark for all other statistical reports released. In this section, we will take a look at all of the major and minor reports that the National Agricultural Statistics Service (NASS), an agency within the USDA, prepares each year. We will delve into the specifics of the reports, including what information is contained within.
The USDA and their significance
The United States Department of Agriculture (USDA), established by Abraham Lincoln in 1862, is the US federal executive department responsible for developing and executing US federal government policy on farming, agriculture, and food. The main goals of the USDA is to help farmers and ranchers promote trade and production, assure food safety, protect our natural resources and, above all, end hunger in the US and overseas. Without the establishment of the USDA, agriculture in the US would not be what it is today.
The National Agricultural Statistics Service (NASS) is responsible for conducting hundreds of surveys every year to prepare reports that cover every aspect of U.S. agriculture. These surveys include: production and supplies of food and fiber, prices paid and received by farmers, farm labor and wages, changes in farm demographics, etc. Without the thorough research done by this agency, it would be hard for agricultural companies to market and manage their products.
Most of the reports that will be discussed below are assembled by the NASS while other market reports are put together by other organizations.
Important Public Crop Reports
While there are many reports that pertain to the grain and oilseed markets, there are certain reports that all traders need to consider when it comes to staying on top of these markets.
Weekly
- Crop Progress
- This report is issued by the NASS on Monday afternoon during growing season (Apr – Nov). This report lists planting, selected maturity stages, the overall condition of the crops in the report, and harvest progress in the top producing states.
- Export Sales
- Export Sales are released on Thursday morning (day could vary due to holidays) and reports the previous week’s export sales. Although this report comes out weekly, U.S. exporters are required to report any sales over 100,000 metric tons of a single commodity to a single destination or cumulative sales of 200,000 tons or more of one commodity during the weekly reporting period to a single destination by 3:00 pm eastern time.
Monthly
- USDA Supply and Demand Report
- Each month, the USDA publishes crop supply and demand estimates for both the Nation and the World. This report is the most anticipated report released each month. It contains the official domestic production, usage, and ending stocks estimates. It is released between the 9th and 12th of each month and reflects estimates from the first of the month. The January report provides the final US production numbers.
- Crop Production
- These reports run along with or the period just after the growing season. The report outlines crop acreage, yields, areas harvested, and other production information. The final estimate for soybeans and corn is completed in January. These estimates reflect actual field survey done across the US by the USDA.
Long-Term
- Quarterly Grain Stocks
- Released at the end of each quarter, this report estimates the total amount of each commodity and then divides that into on-farm and off-farm. The stocks number is taken as of December 1st, March 1st, June 1st, and September 1st.
- Prospective Plantings
- This report is released at the end of March and compiles planting intentions that are reported by various farmers across the US. This is also a highly anticipated report that allows for industry participants to better plan for the months ahead.
- Acreage Report
- This report is released at the end of June and gives the industry actual planted acreage of each commodity.
Conclusion
Knowing when these reports are released and the numbers they contain will better help familiarize you with the current fundamentals of these markets. You can always refer to the USDA and NASS for any information regarding supply and demand in these important markets.