Yesterday, WPI briefly examined how biodiesel production margins have surged alongside broader energy markets following the U.S./Israel-Iran conflict. The surge in energy prices lifted biodiesel margins to two-year, if not higher, levels and has exerted a similar, positive effect on ethanol production margins. WPI’s updated models looking at ethanol production margins suggest that returns above total costs rallied from -$0.07/gallon last week to $0.29/gallon as of midday Friday. Returns above variable costs (which WPI often finds to be a better predictor of the industry’s response to financial swings) are forecast to be near $0.50/gallon right now, up about fourfold from last week. The primary driver of this improvem...
What You Need to Know Today: The U.S. dollar continued to strengthen Thursday as persistent inflation reinforced expectations for additional Federal Reserve interest rate hikes. Higher Treasury yields have helped support the dollar, potentially reducing the competitiveness of U.S. agricultural...
In yesterday’s WASDE, USDA reduced its overall red meat and poultry production forecast for 2026 as declines in beef and broiler output more than offset increases in pork and turkey production. Fourth-quarter beef production was revised downward because of slower fed cattle marketings and...
Key Takeaways: Dry bulk freight markets were stronger this week, but the rally was uneven and due to divergent dynamics across basins and vessel classes. Panamax markets were broadly higher, but Atlantic grain demand was primarily responsible while Asian activity was subdued. That trend...
From WPI Consulting
Forecasting developments in production agriculture
On behalf of a private U.S. agricultural technology provider, WPI’s team generated an econometric model to forecast the movement of concentrated corn production north and west from the traditional U.S. Corn Belt. WPI’s model has subsequently provided quantitative support to a multi-million-dollar investment into short-season corn variety development. WPI’s methodology included a series of interviews with regional grain elevators and seed consultants. Emphasizing outreach and communication with stakeholders who possess intimate sectoral knowledge – on-the-ground insights – is a regular component of WPI’s methodologies, made possible by WPI’s ever-growing network of industry contacts.