Lower oil export earnings for OPEC countries have affected U.S. broiler exports; is there a lesson for the NAFTA renegotiations?We’ve long argued that the most important trade metric in macroeconomic terms is the overall volume of trade, not the balance of trade. Lower imports into the U.S. reduce exports in the long run because they decrease the purchasing power of trading partners. As the U.S. buys goods and services from other countries, it does so in U.S. dollars that can ultimately only be redeemed in the U.S. In short, capital flows move counter to trade flows, so a trade surplus means a deficit of capital inflows, while a trade deficit will lead to more capital inflows.Consider crude oil and broilers. OPEC member countries started ea...
What You Need to Know Today: A third U.S. border crossing (Columbus, New Mexico) has reopened to Mexican cattle imports following nearly two years of restrictions related to New World screwworm. The reopening could gradually improve feeder cattle availability, although more than 60 confi...
Yesterday, the USDA’s Agricultural Marketing Service (AMS) released a new report of negotiated cash purchases of cattle under the mandatory price report. The report included Colorado, New Mexico, Oklahoma, Texas, and Kansas. The goal of the report was to solve the confidentiality issues e...
Key Takeaways: U.S. soybean crushing began in 1911 and saw its most rapid expansion during the 1930s amid the broader agricultural and technology revolutions of the time. After peaking in the early 2000s, the soybean crushing industry went through a downturn as poor crush margins forced...
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.