As mentioned in Wednesday’s morning newsletter, USDA held its Fall Data Users’ Meeting yesterday, which brought together the top minds from all of USDA’s statistical gathering agencies to explain any changes that have been made (or will be made) to administration and/or data and report releases. The meeting also gives data customers (i.e. analysts, farmers, any sort of USDA data end user) the opportunity to ask questions about the considerations and assumptions that go into calculating many of these reports.

Here were a few of the top insights I took away from yesterday’s meeting. USDA also posted the Q&A session of yesterday’s meeting online, which can be accessed here.

The great export report snafu

There were three weeks late this summer in which the USDA-Foreign Ag Service weekly Export Sales report was not released after the implementation of a new reporting system went horribly wrong.

FAS had been developing the system over the past couple years, according to Patrick Packnett, USDA-FAS’s Deputy Administrator of the FAS’s Global Market Analysis. The existing system is “antiquated and needs to be brought up to today’s standards.”

But the August release was unsuccessful, so the legacy system was reinstated three weeks later. The old system continues to work without any issues.

Packnett shared that there is not a current timeline framed for the re-launch of the new system, though it will likely occur at some point in the next calendar year. And it could be launched more smoothly this time around, too.

Packnett shared that FAS plans on releasing more information for this system release than the last, which will provide a preview for end users about how the information will be organized so that end users can be more prepared and better trained for the new system – considerations that were not previously made when FAS attempted to launch the new export sales system in August 2022.

FAS has taken many of the lessons from the August 2022 export report system snafu and is hoping to create better training opportunities from the upheaval. With the advance training, it will completely phase out the legacy system when the new system is implemented to avoid making the export reporters have to report the same data into two different systems.

Packnett acknowledged that the reporting process takes time and expressed appreciation for the work the reporters provide to ensure accurate export information every week. The new system’s implementation will have more collaboration with the exporter community.

This is a big win for us data end users. It means that not only will we have advance notice and training for this new system, but it is more likely to face fewer challenges and issues upon its release. At least, that is the hope!

Faster – and better? – acreage reporting

NASS’s chief of the crops branch, Lance Honig, shared that NASS would finalize fall acreage reports for corn, soybeans, sorghum, and sugar beets in the September Crop Production (and WASDE) report instead of the October one going forward.

Those of you who read this newsletter faithfully will know that this NASS change was actually unofficially implemented this fall, which caused me to fumble my way through the September WASDE report’s release (sorry!!!).

But going forward, we can expect final acres in September with a little more certainty. Why is this? Honig explained that NASS, in conjunction with the Farm Service Agency and Risk Management Agency, reconciles it with data from its surveyed and objective acreage methods.

FSA and RMA crop insurance and failed acreage data is typically finalized ahead of the August Crop Production and WASDE reports (released Aug. 12 this year), but this year there was a slight delay in the report’s release which ended up occurring on August 22.

And there is even better news here – Honig noted that the variance between FSA acres and NASS acres is decreasing. Both figures (though they in theory should represent the same acreages) are never the same, with NASS acres typically a little higher than FSA acres.

Why is there a difference in the acreage reports? Honig cited a few key reasons. First, there are bigger swings in acreages throughout the growing season due largely to weather issues, which can provoke last-minute farmer changes. When these data swings occur, USDA takes the time to review its own methodologies to ensure there isn’t an operational error.

Second, NASS is working to shrink the difference between FSA and NASS acreage differences, but acreage is inherently difficult to measure. However – third – NASS and FSA’s ability to measure acreage is improving. The big issue for NASS that remains is how to measure the portion of acres NOT reported to FSA.

In the event there is a delay in the acres being finalized in September, Honig assured data users that NASS would issue a bulletin to inform end users of the delay which would specify when the updated acres would be modified in the monthly Crop Production and WASDE reports. It would likely be delayed until October, but Honig said that unless NASS otherwise informs the public, expect to see finalized acres in the September Crop Production report going forward.

In regard to more granular double crop acreage reporting, Honig hinted that there would be more information on that topic at next spring’s data users meeting.

Farm Service Agency info

Mike Walter, FSA data analytics officer, explained some of the ongoing efforts FSA is engaging to help farmers. FSA is the frontline handler for farmers who continue to seek emergency and pandemic relief programs as well as ongoing support for crop insurance products.

Walter noted that this year’s ARC and PLC program payments, which reflected the 2021 growing season, were lower than normal for this time of year, due in large part to high commodity prices. Walter reminded market watchers that farmer signup for 2023 ARC and PLC insurance products opened last month and will end March 15, 2023.

ARC, PLC, and ARCIC payments for 2021 production paid out this fall were as follows:

Here were other key FSA highlights:

Modernization

Honig, Packnett, and Walter all discussed separate ongoing efforts to continue modernizing USDA’s data products to keep up with the modern world.

Packnett highlighted plans to release the updated Export Sales data system at some point next year, which will replace the current antiquated system in place. Walter highlighted plans to create interactive dashboards for FSA data that would provide more granular insights from the agency’s findings, though noted that other modernization plans for FSA could still be three to four years away.

Honig reminded end users that the Secretary of Agriculture’s monthly WASDE briefing is currently being livestreamed on YouTube following the report’s release. Honig and World Agricultural Outlook Board chairman Mark Jekanowski often explain details about crop production and supply and demand estimates updates in the session that aren’t always in the written reports.

If interested, the livestream begins five minutes following the release of every major USDA report here.

Additionally, Honig highlighted ongoing efforts to make filling out crop and production surveys easier, more user friendly and more efficient for farmers as part of NASS’s ongoing efforts to create more useful customer-facing products to distribute and share with end users.

Timeliness of report releases

It turns out, government agencies are human too. One end user pointedly asked about USDA’s ongoing efforts to maintain timeliness in report releases.

The timeliness of reports is an important factor. As Honig reminded users, the cornerstone of these market reports rests on the fact that everyone has equal access to the data at the same time.

“Equal access is the highest priority,” Honig assured users.

Several other officials addressed the topic. The FAS export snafu was an anomaly, to be sure. But recent delays in other reports, like FSA’s acreage data, have other roots. USDA has increased technical in-house support to minimize these issues.

The market (and likely programmed algorithms) also has the expectation that reports are available within one to two seconds of the top of the hour. Sometimes that span can range from 10 to 12 seconds, frustrating end users.

Also, these reports are archived on several different sites across the internet. Not every report’s link can be updated as quickly as its counterpart on a different site, which also accounts for perceived delays.

Part of USDA’s modernization efforts addresses creating more centralized locations for these data and reports.

WASDE calculations and logistics

Perhaps the most eagerly anticipated part of the Data Users’ Meeting is the Q&A portion, in which those of us grain nerds can ask USDA economists and statisticians about the finer details of the market reports – specifically the WASDE reports.

Reuters global ag columnist Karen Braun asked several pressing questions about USDA’s measurement of China’s corn stocks value. I won’t dive into that topic – you can read more about it Braun’s column here.

There have been wide reports about Russia’s theft of Ukrainian grain supplies in recent months, which could threaten to upend Russia and Ukraine’s respective balance sheets, especially after Russia illegally annexed four of Ukraine’s oblasts (states) in the eastern part of Ukraine earlier this fall.

But officials reaffirmed their positions amidst this chaos. USDA follows the U.S. Department of State’s lead on these issues, which means that USDA still counts grain shipments out of Crimea and the four annexed Ukrainian oblasts toward Ukraine’s grain flows. As long as the State Department refuses to recognize Russia’s sovereignty over Ukraine, the grain flows will be counted in Ukraine’s balance sheet.

To that end, end users questioned if USDA would ever consider publishing supply and demand estimates for Russia and China separately from the current WASDE report. WAOB Deputy Chairman Bill Chambers noted there are no current plans to change the methods to calculate or distribute WASDE reports.

This was an important question because of the massive production and consumption scale of both countries. Plus, USDA attachés were removed from Moscow over a year ago on eroding diplomatic conditions. And China’s state estimates for grain stocks are not always viewed as reliable.

But it is worth noting that USDA has other methods and sources to collect and evaluate production and usage data from these countries, even as the state-issued figures are questionable. “We make the best estimate we believe possible with all of the data we can,” Chambers explained.

Other tidbits