Why would Producers provide information to the USDA?

[giolucas]

As Producers you are damned if you do and damned if you don't give the USDA your production information.  If you overstate your production numbers the price of grains goes down, if you understate your numbers price goes up?  So what the hec. 

Who runs who?  The USDA or the Producers?  Do Producers get compensation for the USDA surveys?  So could someone explain why would a Producer is motivated to give up their valuable information.  Or as a Producer would you just fudge numbers to help your own position? I have read that many times USDA has given wrong results that has caused major market chaos. 

The Producers can probably come up with a more precise report than the USDA.  

[sw363535]

they don't

[GoredHusker]

The better question is why doesn't the USDA use the information they have available?  With Federal Crop Insurance, one must give both acres planted and production.  Why doesn't USDA on the June 30th report use RMA acres?  For the most part, I'd guess RMA has most production in from the 2011 crop.  If one wants subsidized crop insurance, they have no choice but to give acres and production.  If it were up to me, I'd scrap the March 30th report because it really doesn't mean much while the June 30th does.  Plust, the gov't would have actual numbers. 

[Palouser]

Sorry, but I find this approach idiocy. Don't like the USDA numbers?  Then use another source. There must be dozens available.

My question? Which one are you going to use and why?  Why is that other source better? And if it's better then why doesn't the market use it? 

The idea that the USDA owes you, especially if you don't like the numbers, is ridiculous. Don't like the numbers then do some research and come up with your own. Over time see if you do better. Tell me how it works out.

Commodity markets have NEVER been as dynamic and evolutionary, subject to so many outside factors and as global as today. Statistics take time to model successfully. It's not as simple as getting a 'source' for one set of facts.

But then it gets totally ludicrous that one should depend on producers for figures because they want to hedge their bets by lying! Geeeesh!

[sw363535]

Your last 2 paragraphs prove the point.  USDA numbers are just another set of numbers, no better than anyone else's and for the most part----always questionable in accuracy.

It is the promotion of their accuracy that creates the stir.  And the continual dependence on them by the news services that is ridiculous.

Not the complaining by the producers.  The producers are the ones close enough to production reality to judge the credibility of the source.

Hedging producers are not the ones living by the usda "numbers",  just the ones complaining.  Frankly,  we don't need those predictions.  We are the ones who are comfortable with the price discovery process.  We don't need the market to gyrate wildly on a monthly basis.  And frankly I do use other sources for information, as probably most do, it is more accurate.  The grain merchandisers have a much better handle on grain movement and production.

This weeks published claim of accuracy(released through dow jones), which is for the most part job justification, coupled with the claim of 80% responses to USDA surveys is what these comments are dealing with-----------and that is idiocy.

[Palouser]

You say, "USDA numbers are just another set of numbers, no better than anyone else's and for the most part----always questionable in accuracy."

Any set of numbers fits that description. However, this is not really that subjective. There are studies and charts - put out by academics and the USDA itself - specifically evaluating the accuracy over time. It's all available. In charts and tables. What other sets of numbers are MORE accurate? Specifically - it's all the fashion to trash USDA numbers. Fine, but if one can't come up with BETTER numbers it's just trash talk. And maybe absolutely wrong as a generalization.

If one criticizes they need to show the evidence that there is something better. Ideology and trash talking is what people do nowadays, but talk is cheap.

Yes, the numbers do affect the market - at least temporarily. We know that. And we can adjust our behavior to account for that. If there are better numbers (at least believed by the market to be so) they would have exactly the same affect. After all, HOW MANY TIMES does the market take on a severe contrarian behavior after the report. IS THAT THE FAULT OF THE USDA? Maybe its computers understanding/reacting to other computers and other behaviors. 

I'll just about guarantee you that there would be a hue and cry around the globe if the USDA figures disappeared tomorrow. Look how much gnashing of teeth there was when a few minor reports were removed by budget concerns.

I guess I'm really tired of the blame game w/o specific evidence over time. And I think these are the most difficult times to evaluate grain in history. But, I'm all ears if there's another set of figures that have stood the test of time.

[sw363535]

Palouser,

I understand your complaining over complaining.  

Accuracy----That is the real point.  And I have no problem with their "accurate guess" at the present stocks figure, or any other number that is based on real data.  Even though this is the US and not China, I will not complain again if you can get them to stop with the numbers that they have data on.  

But USDA cannot help themselves, they must venture into the future speculation field.--------pleasing the masses and the bets.

The most published and possibly influential number presented yesterday was total fiction, a guess as to the actions of the future.  They have no factual data to know what "PLANTING INTENTIONS" are.  This is where USDA looses credibility with me.  No matter what the result of their very unscientific survey is,  weather will change it in a day.  

If the intentions number had come in at 76m I would feel the same.----------they don't have know or have anything scientific to back it up.  

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Market moving----------they should be,  reliable, dependable, direction pointing actual data.

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I think, if the government didn't present that future prediction figures, many others would.  And we would still have the speculation to speculate on.  And that is fine.  It is not governments role to speculate on the future.  We ask them to be, they claim to be, and you claim they are accurate.

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Important--IMO----side note.  With most of the new storage being built by producers, not marketers, the USDA had better figure out a way to mend their relationship with the producers of the crop or even their stocks figures are going to be fictional.  We may be there already. 

[farsider]

http://www.nass.usda.gov/Education_and_Outreach/Meeting/sum2011.pdf

[sw363535]

Thanks farside, 

A great read and right on subject.

I wish they could have gotten deeper into the production storage issue.  

The NASS comment "

But given the money today, we have to rely on asking farmers about how much they have in the bin. The last two years have been this way, but they aren’t the only two years in the last twenty. Is it really dramatically different these two years than in other years?"

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to me that is a "disconnect from reality" statement.

4 things about the last 3-4 years that I wonder about the affect on farmer responses.

4).  the payment limit-(I am not condemning it, shut payments off would be ok with me)-- means that most of those who build grain storage don't feel compelled to answer voluntary questions.   In most western counties of the grain belt--IMO--- 60-80% of the grain is probably produced by 25%(or less) of the producers.  If you want accurate data you better have those "EWG hated BTO's" on board.  Since anyone who owns a small % of a field is considered a producer, the ratio may be larger.

3)  Alcohol in the last three years is a huge change in the way we handle and store grain,--------direct from the field as well as farm storage.

2)  Tying the IRS to the farm program verifications does not harbor good will If you want folks to give you accurate data-voluntarily

1).  High grain prices--------You don't have to look far to see the large numbers of new grain storage structures that have been built in the last few years.

Thanks for the read ---------Farsider

[sw363535]

Farsider

I also noticed that while the goal of accuracy is repeated over and over,  Most of the discussion is an explanation of why they are not.  And at one point I felt like they were saying our data is accurate, it is the changing variables that cause the inaccuracies.