Given current tight global rice stocks and high prices (see graph below), the question is how much wheat will be substituted for food or feed use. Rice prices have dropped since their peak early this year, but wheat is still 35 percent cheaper by weight than rice as a food grain. It is one reason why the uptake of wheat in East Asia has been growing at twice the rate of rice consumption. Technically, wheat imports are up 7 percent this year in South America but are down 8 percent into East Asia. Any increase in wheat for feed due to higher rice prices is likely limited. This is because rice is precious as a food crop and the amount used in the feed ration is limited. One study suggests that on average, 6 – 10 percent of global rice o...
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...
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
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.