Later this month, when USDA releases its first crop estimates based on producer plans, the commodity markets will take notice.  In fact, the department reports the impact of data on corn prices has magnified since 2006, with monthly and annual production data releases, and particularly with quarterly grain stocks reports, now resulting in market price changes of ten or more cents in a majority of cases.

Paul Bertels, vice president of production and utilization for the National Corn Growers Association, says – when examined, the data clearly demonstrates a marked increase in commodities market volatility. While many factors certainly impact cash markets on a given day, Bertels says, – the correlation is too strong to ignore

According to USDA, from 1994 through 2006, the market price shifted by ten or more cents on only 18 percent of the days following report release.  From 2007 to present, the impact of data release has become significantly more dramatic with a ten or more cent price shift in 64 percent of these cases. Also, the quarterly grains stocks report has its effect on prices.  Between 1994 and 2006, the market reacted by shifting up or down in a nearly equal number of instances.  Since 2007, the impact was almost two times as likely to be negative.

Courtesy: NAFB News