As the date of the resolution of the US-China trade dispute drifts further and further — perhaps past the 2020 elections according to Mr. Trump — it behooves us to look at what soybean futures contracts for September 2019 indicated as of Trump’s announcement of Section 301 action against China ($10.30 bushel on 3/22/2018) vs $8.67 today (Sept. 2019 is the front month future for soybeans now).
Source: Barchart.com, accessed 8/16/19 1:51pm Pacific.
While some forces have driven down prices relative to what they otherwise would have been — African Swine Fever — other factors have driven them up (bad harvests elsewhere). But certainly tariffs, and Chinese guidance to Chinese firms not to purchase American soybeans, have had an impact.
Interestingly, the Sept 2019 futures price has continued to trade at roughly the level achieved when Chinese tariffs on soybeans were actually implemented. In other words, the big nearly $1.60 impact seems to be a discrete shock associated with …tariffs (and “guidance”).
Maybe Menzie is letting me have all the fun today, I think he knows I like quoting the NOWcasts sometimes.
NYFRB says theirs has risen 1.58% to 1.82%. I’ve always said their number looks more realistic to me than Atlanta Fed’s.
Then you have the user friendly but seemingly (usually) over-optimistic Atlanta NOWcast holding steady at 2.2% after a positive residential construction report.
It seems slightly odd these numbers would be this good—I’m assuming related to the lowering of the discount rate. Eating generic brand mint Oreos with whole milk raises my mood for a few minutes also, but……
Moses Herzog: I suggest you read Jim’s post on how the two nowcasts differ in construction.
When it is more than 63 days until advance GDP release, Atlanta Fed’s nowcast has a larger mean absolute error than NY Fed’s, according to Deutsche Bank, “Tracking the GDP Trackers,” July 24, 2019.
I greatly appreciate this. I think you had suggested me read Prof Hamilton’s post at least once before and I know I at least skimmed it and probably read it through but it never hurts to touch base again on these better posts. Your mentioning of the Deutsche Bank thing makes me feel good as it seems to confirm a theory I have had for awhile now—that the Atlanta Nowcast was good, but not quite as good as NYFRB (at least in recent times when I had my eyes on it). As you know, not all of my theories are “later confirmed”, so that’s a booster seat for my ego.
I remember you said (and Professor Hamilton also said) that sometimes it’s best to take the average of the NOWcasts (and maybe some other forecasts) and you’d often get a pretty good number. About once every 4 days now, I get about 5 super good graphs in my in-box. Maybe 1 out of 10 of those is a Deutsche Bank graph—I have to kind of hunt around for those “proprietary” newsletters though—I will hunt and peck maybe in 3–4 weeks to look for that as it’s about 75% I can find them somewhere after they get slightly dated—or FTAlphaville might paraphrase it etc.
Thanks again.
“While some forces have driven down prices relative to what they otherwise would have been — African Swine Fever — other factors have driven them up (bad harvests elsewhere).”
Yes an inward shift of the demand curve (ASF) tends to lower prices while an inward shift of the supply curve (bad harvests) tend to raise prices. But should we note also be looking at quantities. Give CoRev a wee bit of credit as he has been mining the data on world production. And of course we should laud look at these statistics.
It does seem your two non-tariff events both tend to lower production and that is what the overall data shows. Here alas is what CoRev misses – Chinese tariffs on soybeans produced in the US but not on Brazilian soybeans would tend to lower US production by a lot while it would raise Brazilian production. Now I’m not sure if CoRev has been smart enough to note that this is exactly what the data shows. Maybe he has noticed this – but me thinks he will never admit that these are the facts.
Pgl, still doesn’t understand the basics of farming. Here alas is what pgl misses. “Chinese tariffs on soybeans produced in the US but not on Brazilian soybeans would tend to lower US production by a lot while it would raise Brazilian production. ” Tariffs effects are shown in the US and Brazil data for harvest years 2018-19. For the current harvest year, 2019-20, there is no data only estimates. For 2019-20 Brazil hasn’t even started planting yet, and the US estimates are down because of BAD WEATHER in the US Planting season causing fewer acres being planted and probable lower yields on those acres planted. Because of that we can’t know how much would have been planted.
Only poor economists would consider an estimate of US harvest yields, before harvest is even started, and for Brazil any estimate of yields before even the planting season as DATA. We just had a corn example of how estimates can change in one month and effect prices dramatically. Me thinks pgl will never admit that these estimates he considers data are NOT FACTS.
WEATHER EFFECTED US SOYBEAN PLANTING, AND IT’S TOO EARLY TO TELL IF BRAZIL WILL BE EFFECTED. IT’S ALSO TOO EARLY TO TELL IF IN THE US THE GROWTH AND HARVEST WILL YET BE EFFECT BY WEATHER.
Farming is always effected by weather, both positively, the corn example and negatively.
CoRev: I think the word you want is “affected”, instead of “EFFECTED”.
The use of “effect” and “affect” seem to be one of the most difficult word choices in the English language. I notice that newscasters and many others have defaulted to the use of “impact” as an alternative to using “effect” and “affect”.
I saw this regarding use of the two words;
“While affect is always a verb, effect is usually a noun. As a noun, effect means “the result,” “the change,” or “the influence.” As affect, a verb “produces a change,” effect, a noun, is the “change” or “result.” Since effect means an “influence” in this sentence, it is the correct word to use here.
Here is an entry that says, “affect” is a noun and a verb, as opposed to above entry saying “affect” is always a verb.
“Affect is both a noun and a verb, but it is almost always used as a verb, meaning, “to influence, change or alter.” For example, This game will affect our standings in the league. The argument affected their marriage deeply.”
Below is the Webster entry:
‘Affect’ vs. ‘Effect’ Affect and Effect can both take the form of a noun or a verb, but most often you will want to use “affect” as a verb, meaning “to produce a material influence upon or alteration in” and “effect” as a noun meaning “a change that results when something is done or happens.”
Maybe a sentence diagram would be helpful before using either word? I may need to stick with “impact”.
AS: From context, and my understanding of grammar, it’s clear he should be using “affect”. One could use “effect” as a verb, as in “effect a change”.
Hope you do not think I was trying to correct you. I was making a gratuitous comment about the uses of each word. I agree with your word choice. I always need to stop and think about the use of each word.
AS: No, we’re all agreed good to clarify.
“Affect” as a noun has a completely different meaning usually in psychology, meaning an emotional state.
In any case, CoRev used it incorrectly.
CoRev just makes it up as it goes. I was not referring to harvests – I was referring to actual production data. Of course a Trump sycophant would just ignore inconvenient data as he invents statements I never made. But do babble on incoherently. It is what you do!
Pgl, lies again. “{ I was referring to actual production data. ” For a 2019-20 harvest still to occur pgl has PRODUCTION data??? Your comment synopsized: “…would tend to lower US production by a lot while it would raise Brazilian production. … note that this is exactly what the data shows.”
Do I need to repeat the dates? Tariffs occurred in 2018, and that is the ONLY Harvest period where actual DATA is available that has been impacted by the tariffs. (Thanks AS) And that data does not show your hypothetical result. Estimates are not data.
Pgl, please read a farming book to at least get a glimmer of understanding of terms and timing.
CoRev: Actually, we treat estimates as data all the time. The advance release of GDP is an estimate, for instance.
And we know CoRev conflates spot prices with future prices all the time!
Menzie, “Actually, we treat estimates as data all the time. ” Explains a lot for accuracy. So do climate scientists using their models, and their projections still diverge from reality in months. You’d think after decades they would improve the models.
BTW, ask pgl to show us his data.
CoRev: that’s a useful comment.
Let’s provide an actual source on Brazilian production – something that in all his foaming at the mouth CoRev has yet to do:
https://www.statista.com/statistics/741384/soybean-production-volume-brazil/
The last bar is the forecast for 2018/19, which I never referred to (so when CoRev claims I got this wrong, he flat out lied about what I have said in the past. Note the forecast for 2018/2019 suggests a small decline from the actual production for 2017/2018. But yea – it is a forecast not actual production. But again I never referenced this particular data despite all of CoRev’s foaming at the mouth.
My reference was to actual production in 2017/2018 which was well above actual production in 2016/2017.
The graph is clear as it can be. And CoRev as usual got everything wrong. But pardon me for interrupting. I turn the microphone over to CoRev for more foaming at the mouth!
Pgl is just plain scary with his ignorance. His ?data? was from an article last edited May 13, 2019. Yes ther have been revisions sincel;ast May. He also claimed: “My reference was to actual production in 2017/2018 which was well above actual production in 2016/2017.” Which was, AS I SAID, before the tariffs were implemented.
Real data and estimates are:
US 2018/19 Soybean production——————-133,853 (*thousand metric tons)
US ESTIMATED 2019/20 Soybean production –111,494 *
Data based on Local Marketing Year (MY). Soybeans are on a September/August MY
Brazil’s 2018/19 Soybean production —————117,000 *
Brazil Estimated 2019/20 Soybean production —123,000 *
From here: “https://apps.fas.usda.gov/psdonline/circulars/oilseeds.pdf
Data based on Brazil’s local February/January Marketing Year (MY).
To clarify the timing, Brazil has yet to start its 2019 planting season and the US has yet to start its 2019 harvest season. All US production numbers are estimates and for Brazil very, very early estimates.
These complex terms and and their timing seem to confuse poor pgl.
“BTW, ask pgl to show us his data.”
LOL! CoRev makes up some claim I never made and then demands I show my data on an alleged claim I never made. Just amazing.
“To clarify the timing, Brazil has yet to start its 2019 planting season and the US has yet to start its 2019 harvest season. All US production numbers are estimates and for Brazil very, very early estimates.
These complex terms and and their timing seem to confuse poor pgl.”
Oh lovely – CoRev goes off on something totally irrelevant to what I actually said. Yea – it may be relevant to the bogus claims made by you. To clarify? Seriously? You write all sorts of spinning gibberish with no apparent point and clearly no well articulated model. I guess Team Trump pays you by the word and your comments are so all over the map, no one has a clue what you are babbling about. Including and especially you.
“WEATHER EFFECTED US SOYBEAN PLANTING, AND IT’S TOO EARLY TO TELL IF BRAZIL WILL BE EFFECTED. IT’S ALSO TOO EARLY TO TELL IF IN THE US THE GROWTH AND HARVEST WILL YET BE EFFECT BY WEATHER.”
Effect is the noun. The verb is affect. Now that we have helped you with preK writing, I’m sure you have read Fama (1970) by now as well as the earlier writings on rational expectations by John Muth. So take your expert skills at agricultural modeling and forecasting and predict soybean production by nation and market prices over the next year. If you predictions turn out to be EXACTLY right – you can take a bow.
But if there are in the least bit off in any way, we will hold you to the same standard that you hold our host. In other words, get ready for a lot of laughing at you.
Of course knowing you – you will not take up my challenge. After all – you are a coward.
CovRev,
Have you looked at the WSJ article on 8/15/19 , page B10 regarding ethanol and corn. The US is removing the requirement for certain small refiners to add ethanol to diesel and gasoline. As a result corn futures’ prices have declined dramatically.
Not that I understand much about the farming relationship of corn and soybeans, but below is a link describing corn as a substitute for farming soybeans. With a boycott of soybeans and price reduction in corn due to the decline in ethanol demand, it seems to be a very tough farming environment.
Link to comment on substitutes: https://www.thebalance.com/corn-vs-soybeans-808899
As, today;s value ratio is still ~2.34. The ratio is still governed by supply and demand. Soybean demand had been rising for several years until the tariffs, ASF, and the US Spring planting season weather. It looks like for the 2019-20 harvest both supply and demand will be down. Brazilian farmers may have a hard decision this year.
Did you notice this paragraph in your reference:?”As winter gives way to spring farmers prepare to plow and fertilize their acreage for seeding. They then tend to the growing crops through spring and summer, eventually harvesting the grains in the fall. The crop cycle repeats itself each year. Of course, Mother Nature plays a role; the weather ultimately dictates the success or failure of each crop.” I have trie3d to make this point for months.
Did you also note the reference to 2012 corn prices due to a drought?
During periods when the ratio is stable, farmers often alternate between soybeans and corn in the same fields. There is a benefit to reducing some levels of fertilizer requirements for corn..
I did read the website explanation. That is what lead to my comment about a tough farming environment. Prior to reading the website information, I was not aware of the ratio relationship between corn and soybeans.
I guess you did not note that the date of the publication was well over a year ago. And the fact that his latest reference to any market data was well over two years ago. Then again – you never learned to read a calendar so no worries!
CoRev reminds us of his tenuous grasp on reality “Of course, Mother Nature plays a role; the weather ultimately dictates the success or failure of each crop.” I have trie3d to make this point for months.”
Uhh. CoRev, no one is trying to suggest weather doesn’t matter. What we are pointing out is that FUTURES prices are the best predictor of subsequent harvest time spot prices and event studies show that those FUTURES prices clearly and successfully predicted an outsize (LARGE) and negative impact of tariffs. Contrary to your many many incoherent assertions. It seems the key to all this madness is for CoRev to study up on event studies, how they are performed, and why they work.
AS Corn and soybeans are imperfect substitutes because today’s hybrid corn is a nutrient hog. Corn yields fall off dramatically after the first year. As a practical matter you can only grow corn in the same field for two (or at most three) consecutive years, otherwise the fertilizer costs would make it uneconomical. Planting soybeans every other year or so will fix nutrients back into the soil. Farmers don’t just look at prices, they also have to consider the planting history of their fields.
I seem to remember something about nitrogen fixing bacteria related to beans, but was unaware of that “hybrid corn is nutrient hog” .
AS, yup! It’s mostly nitrogen.
AS, I forgot to answer your earlier question. Yes, i did read that article.
Corn also tends to hog phophorus as well, but it is nitrogen that beans fix from the atmosphere, so that is the element at issue when farmers substitute beans for corn for nutrient reasons, as my friend whom I just visited does.
“In March 2017 at the very beginning of the crop year, the corn-soybean ratio or value relationship between the oilseed and grain in the prices of November soybeans divided by December corn stood at the 2.6:1 level making soybeans a more valuable crop for farmers. Therefore, it is likely that farmer will favor planting beans over corn which could result in a decline in corn inventories in the future which may support the price of corn.”
The publication date of this discussion was April 15, 2018 but he seems to be writing based on information the spring before. Of course prices for soybeans fell dramatically a few months later. Our host would note that the Chinese tariffs on U.S. soybeans was part of the reason. But shhhh – we do not want to rile up old CoRev!
“The monthly chart of the corn-soybean spread illustrates that when the spread is above 2.4:1 soybeans are historically expensive relative to corn. Therefore, farmers tend to plant more soybeans as that grain will yield greater profits. When the spread is below 2.2:1 corn is historically expensive relative to soybeans.”
This seems to be the ratio of soybean prices to corn prices, which is not exactly a spread. I have seen other discussion calculate “the” spread as soybean price minus 2 times corn price. It makes a difference even if I’m sure the simple arithmetic is over CoRev’s head.
It would be interesting to see a reliable discussion of what this is really about. I’d ask CoRev to mansplain this to us once he puts his shoes back on (he is trying to learn to count past 10).
Pgl, its good that you read the article. Only you seem to be having trouble understanding it : ” It would be interesting to see a reliable discussion of what this is really about.”
Hey CoRev – please mansplain it to us! Especially how a ratio becomes a spread. This should be a lot of fun!
The article was really weak at best. But given your preK level of education, you probably thought it was an American Economic Review publication!
CoRev Pgl, still doesn’t understand the basics of farming. Here alas is what pgl misses. “Chinese tariffs on soybeans produced in the US but not on Brazilian soybeans would tend to lower US production by a lot while it would raise Brazilian production. ” Tariffs effects are shown in the US and Brazil data for harvest years 2018-19. For the current harvest year, 2019-20, there is no data only estimates. For 2019-20 Brazil hasn’t even started planting yet
Here’s what you’re missing. When you talk about farming and the weather, you’re essentially talking about farmers playing against nature. Prices move up and down based on rainfall, temperature and the natural fertility of the soil. That’s how an agronomist might look at the world. But farmers don’t just play against nature; they play against other farmers and that puts us in the realm of game theory and not just agronomy. The production decisions are made strategically based on how farmers think other farmers will respond to expected prices. So you’re wrong when you suggest that Brazilian planting decisions for 2019-2020 are unaffected by expected or estimated US production for 2018-2019. Brazilian farmers are making production decisions for next year’s crop right now even though they haven’t yet gone out into the fields. Unlike hobby farmers, real farmers have to contract for seed and fertilizer deliveries and rent capital equipment months before they ever set foot in the field. Trump’s tariffs add an extra dimension to the game theory problem because farmers don’t just have to think strategically against other farmers, but now they have to strategically consider the payoffs for Trump an Xi in a trade war. That additional dimension of uncertainty shows up in the downward level shift in soybean and other ag prices. pgl‘s point was that farmers are forward looking strategic agents who don’t just think about planting decisions two days before they go out into the fields. It’s not only about weather. Farming isn’t just agronomy; it’s also a market driven by strategic interactions, and that makes it a game theory phenomenon as well as an agronomy phenomenon. If you want to be a successful farmer, then you need to consider the game theory payoff matrix between Trump and Xi that Menzie posted months ago.
Someone must have read that seminal paper by John Muth from the early 1960’s. Something called Rational Expectations. Clearly CoRev has not read that either.
2slugds don;t compound pgl’s ignorance by adding your thoughts to his incompetence. BTW, game theory is not farming and farmings is real versus theory.
Are you changing your name now? Whatever the new name is, the same old childish behavior to cover up your incredible stupidity is loud and clear. Maybe your good buddy is now named Yared Kushner. Sounds more Israeli!
So farmers are too stupid to read John Nash? CoRev – just because you are an lying know nothing does not mean farmers are similarly stupid.
I have just had my annual visit with my farmer friend, who also happens to be a Republican and a religious social conservative. However, he is not a fan of Trump and blames his trade war for the poor state of prices of soybeans over all other current factors. He has not received any aid from Trump yet for trade-related losses, but thinks he might be getting some. However, he says it will not cover the losses, and he also says that farmers want markets not government support.
My paternal grandfather was a farmer in Iowa (I do not know for how many years as my father gave scant details generally, and seemed to have a poor relationship with his father). My paternal grandfather died a few years before I was born. As were other men in my father’s side of the family—farmers in Iowa. My father would discuss it, but it always seemed to be a wall there and lots of gray. It was a different world then. My father was not born in a hospital for example. Why I say that is everything in my bones wants to empathize with and speak kindly of farmers, they feed us all, and work a real and honest day’s work.
That being said….. I think your friend is in the minority (ahead of the curve intelligence wise—or at minimum better at deciphering political news) when it comes to American farmers. I believe to this very day most farmers are still buying the donald trump “thighmaster”, the donald trump “ginsu knives”, and the donald trump “LoBakTrax” and “Simply Fit Board”. And maybe even the limited time offer donald trump ShamWow. Farmers do not seem to be able to discern that trump’s policies are tied-at-the-hip with their social welfare payments. Will that change between now and November 2020?? If we are exclusively talking farmers—not the general electorate— it’s going to take serious pain before they can see the obvious. And maybe even for the general electorate it will take serious pain to see that— but certainly it will for the farmers.
Since most farmers are Republican, whether that is a form of “denial” you will have to ask a behavioral psychologist in the Harrisonburg area.
My friend is well aware that he is in the minority and frustrated that other farmers he knows are so willing to put up with the damage Trump is causing them.
He is indeed very smart. His family background is not from farming and his political views do not correspond with those of others in his family or even with those from when he was young, when I knew him as well and when my views were more conservative than his. His late father was one of the leading members of the Manhattan Project and he owns a piece of briefly molten rock that was at the Trinity test at Alamagordo of the first atomic bomb. In a sense his opposition to Trump began as a sort of reversion to his late dad’s concerns about nuclear war with his sense of Trump being stupid and irresponsible and dangerous regarding foreign policy, but has been reinforced by his perception of Trump’s trade wars, which have directly and negatively affected his income.
“he says it will not cover the losses”.
CoRev can help out here with his elaborate model of soybean profitability. Yea – it is complicated but that’s because he has to disguise the fact that he has omitted certain key costs including capital costs while it invents some alleged revenue increase that no one else expects to occur.
The ex district attorney with a bad record on policy is going to have to try harder to make smears on other candidates distract from her record:
https://twitter.com/mtracey/status/1162359335311142912
I was told by Barkley “Never Saw a Sample Size Too Small” Rosser that the former DA is ahead of Biden by 1% in one poll. That equates to 6 potential voters. Barkley is sure to update us soon.
Oh, Moses, you wish to remind everybody that you still owe me an apology for falsely claiming that I had lied about the existence of that poll, whatever its sample size or importance was?
Oh, and on Gabbard, whom the tweet was about, not Harris, it is fine to talk to Assad. It is not fine to go visit destroyed Aleppo with him, which she did. Chomsky did not comment on that particularly egregious act, which is what makes Tulsi completely unacceptable as a presidential candidate, utter garbage.
Dear Folks,
Let me try to add something to clarify this discussion. First, let me thank Barkley Rosser for his information from his farmer friend. Second, I use https://www.merriam-webster.com/dictionary/effected?src=search-dict-box, and note “effected” is “something that inevitably follows an antecedent (such as a cause or agent)”, so that “effected” would mean “caused independent of any other factor”, while “affected” in the relevant sense is “inclined, disposed”. We could also use “influenced” as a synonym, and since we apparently have many factors, this seems to clearly be the correct choice.
Third, a relevant article from Forbes, no friend of the liberal Democrats, argues that the Chinese increased purchases from Brazil in order to impact U.S. soybean producers, and that all producers have to cut back acreage, at https://www.forbes.com/sites/kenrapoza/2019/05/10/for-american-farmers-chinas-soy-tariffs-are-least-of-their-worries/#1b20146871f9. This would seem to be a direct effect of the trade war whatever one thinks about the relative difference in prices.
Finally, I read CoRev’s arguments that estimates are not data. This is correct; they’re not. But the estimates get embodied in prices, and the prices are data. It would seem to me that CoRev’s argument, if things are really primarily affected by the weather, boils down to one of two possibilities, neither of which necessarily have any political content at all. These arguments seem to need the inclusion of the weather derivative market, at https://www.cmegroup.com/trading/weather/, which has functioned for years. It does not have products for Brazilian weather, but it does have products for weather in Minneapolis and Chicago, and these should be quite indicative of weather for the soybean farmers, especially outside California. The Las Vegas products and the Atlanta products should also be relevant. If I understand CoRev’s argument at all, either the weather derivative market, or the futures market for soybeans, or both, are not efficient, namely, they are not unbiased estimates of what will actually happen according to the market participants. This would seem to allow for handsomely profitable investments, that the market participants are not making. The other reasonable possibility is that the markets are showing big effects, which are unbiased estimates, which are independent of tariffs, and are reflected in the weather derivative prices. If this is not a proper reading of CoRev’s argument, what is the mistake?
Julian
Julian,
Estimates are data, but softer than actual prices, which are hard data. Estimates may or may not get embodied in prices.
Regarding CoRev’s arguments, the fundamental reason why you are having trouble pinning them down is that he keeps changing them, although often rather subtly. This is how he operates, when he gets nailed as being wrong on something then he goes and says he said something else, often only slightly different, which keeps him going, with all too many tolerating this. A recent and perfect example was him getting all in a huff when Menzie said he was not taking account of the impact of tariffs on prices, claiming he had agreed that they did (which he has indeed done off and on). But then right after that he twice put at the end of posts emboldened statements to the effect that only weather matters for prices, and Menzie promptly called him out on that, which he just ignored to then shift his position slightly yet again.
Yeah, all these things affect prices, but even when CoRev makes a reasonable or intelligent statement about this he goes and then makes others ones not so reasonable, claiming that large numbers of people not him here are making mistakes, with most of this appearing to soft soap the negative impacts of Trump’s tariffs and broader ag policies. Unfortunately for him, it appears that it is political most of the time.
Julian, thanks for your 3 references. I found the Forbes reference the more interesting. It closed with an universal truism: “For soy prices to go back to double digits per bushel, the U.S. and Brazil will have to plant less soy. Or they’ll have to find new markets, and a new use for all the soy China isn’t buying.” These markets react more slowly to change than the change itself. If you note, that Forbes reference was written before the impact of the US Spring planting season weather and the impact of the ASF infection in China were clear.
Barkley is NOT correct in that my arguments have changed. From the very early days I admitted the impacts of tariffs with the conditional – as long as trade negotiations continue. They are still ongoing and their impacts have been impounded in the prices from their inception. THEY ARE STILL IMPOUNDED! Therefore, changes in prices should be due to NEW information. Remember Fama!
That means if I understand you correctly, you have misread my commentary: “If I understand CoRev’s argument at all, either the weather derivative market, or the futures market for soybeans, or both, are not efficient, namely, they are not unbiased estimates of what will actually happen according to the market participants.” Other new MAJOR NEW factors have impacted prices since the tariffs, ASF and US planting season weather,but, along with them are many, many smaller changes, mostly associated with the trade negotiations, that have resulted in moderate price fluctuations. I see price oscillations in the same ranges as before the tariffs. Just at a lower level, which I claimed as a new price plateau caused by the tariffs. https://markets.businessinsider.com/commodities/soybeans-price
The big difference in my view point versus others here, is I am trying to show the impact through a farmer’s eyes. If you may have noted I often use farmer’s profit and not commodity price as the indicator for the actual impact of Government actions. Few here understand what is involved in farmer’s profitability.
CoRev: To quote you, it’s “a price blip”, a blip that has lasted now over one year — and there is no end in sight for “the talks”.
I guess the French Revolution was a blip too.
Menzie, indeed, the French Revolution was another LONG TERM blip. As was the US Revolution, and is the current lowered soybean prices directly die to the trade negotiations. The only difference is that those negotiations will eventually end, and regardless of their outcome, the prices will adjust and be IMPACTED by that new information. Just as they have been for the past year+.
CoRev reaches levels of pure DaDa-ist absurdity in writing “Menzie, indeed, the French Revolution was another LONG TERM blip.”
Come on CoRev, please, please keep this up. You brighten my day immeasurably with your comedic performance.
Tell me though, in your model does the new information only impact prices once the information regards a certainty or can futures prices embed probabilities as well in your model?
CoRev continues writing incoherent nonsense “Few here understand what is involved in farmer’s profitability.”
Ahh yes. Profitability is such a difficult concept for everyone but CoRev. Please please CoRev, tell us more about this confusing profitability metric. If you would be so kind as to share a spreadsheet laying this out, we would be most appreciative.
Dave,
Ah, you have forgotten. CoRev is a “gentleman farmer,” which allows him to adopt the stance of a farmer here against all the others who are not farmers, just as he periodically puts on airs about knowing more about weather and climate science, not to mention having personally observed up close all the launches in the Mercury, Gemini, and Apollo programs. You must not be so cynical.
As for blips, well, all of our lives are mere “blips” in the eyes of God. So there.