Forum for Science, Industry and Business

Sponsored by:     3M 
Search our Site:


USDA forecasts still accurate, but with room for improvement


A study of the USDA’s corn and soybean production forecasts over a 34-year period concludes that such projections "perform reasonably well in generating crop production forecast for corn and soybeans." Still, the study, done at the University of Illinois at Urbana-Champaign, finds room for improvement.

"In particular, the USDA may want to consider expanding the scope of the subjective yield surveys to incorporate a wider range of market and industry participants," said Darrel Good, U of I Extension marketing specialist and professor of agricultural and consumer economics, who co-authored the study with his colleague, Scott Irwin.

The complete study may be read online at: on Extension’s farmdoc website.

Good and Irwin undertook the study based on comments from producers and others that suggested an ongoing misunderstanding of the USDA’s methodology for arriving at corn and soybean production forecasts. They compared the USDA’s forecasts to private forecasts and the final estimates at the end of each crop year. "We want to improve the understanding of USDA crop forecasting methods, performance and market impact," explained Good.

For corn and soybeans, the USDA releases production forecasts in August, September, October, and November, with final estimates published in January. These forecasts are generated by a highly sophisticated and well-documented procedure that includes estimates of planted and harvested acreage and two types of yield indications, a farmer-reported survey, and objective measurements. "Our review of the USDA’s forecasting procedures and methodology confirmed the objectivity and consistency of the forecasting process over time," said Good.

The researchers also compared the USDA’s forecasts to those produced by private sources over the 1970-2004 period. "On average, USDA corn production forecasts were more accurate than private market forecasts during this period," said Good. "One exception was the August forecast in the most recent time period, 1985-2004. Since the mid-1980s, private market forecasts have been more accurate by an average of 0.5 percentage points in absolute terms, not an inconsequential difference. This reflects a sharp improvement in August private sector forecast accuracy relative to the USDA over the last three decades."

The forecasting comparisons for soybeans were somewhat sensitive to the measure of forecast accuracy considered, Good noted. "One measure showed that private market forecasts were more accurate than USDA forecasts for August regardless of the time period considered. Another measure showed just the opposite," he said. "As the growing season progresses, the difference in the results across the two measures of forecast accuracy diminished, with USDA forecast errors in soybeans about equal to or smaller than private market errors for September, October, and November."

In terms of market impact, USDA corn production forecasts had the largest impact on corn futures prices in August and recent price reactions have been somewhat larger than historical reactions. Similar to corn, USDA soybean production forecasts had the largest impact on soybean futures prices in August with recent price reactions appearing somewhat larger than in the past.

"Overall, the forecasting performance of the USDA in 2004 relative to the private market was quite strong in corn, with the USDA providing more accurate forecasts of corn production in 2004 each month except September," Good noted. "The forecasting performance of the USDA in 2004 relative to the private market was, at best, mixed in soybeans, with USDA forecasts being less accurate than private forecasts each month except October."

Bob Sampson | EurekAlert!
Further information:

More articles from Agricultural and Forestry Science:

nachricht Forest Management Yields Higher Productivity through Biodiversity
14.10.2016 | Technische Universität München

nachricht Farming with forests
23.09.2016 | University of Illinois College of Agricultural, Consumer and Environmental Sciences (ACES)

All articles from Agricultural and Forestry Science >>>

The most recent press releases about innovation >>>

Die letzten 5 Focus-News des innovations-reports im Überblick:

Im Focus: Etching Microstructures with Lasers

Ultrafast lasers have introduced new possibilities in engraving ultrafine structures, and scientists are now also investigating how to use them to etch microstructures into thin glass. There are possible applications in analytics (lab on a chip) and especially in electronics and the consumer sector, where great interest has been shown.

This new method was born of a surprising phenomenon: irradiating glass in a particular way with an ultrafast laser has the effect of making the glass up to a...

Im Focus: Light-driven atomic rotations excite magnetic waves

Terahertz excitation of selected crystal vibrations leads to an effective magnetic field that drives coherent spin motion

Controlling functional properties by light is one of the grand goals in modern condensed matter physics and materials science. A new study now demonstrates how...

Im Focus: New 3-D wiring technique brings scalable quantum computers closer to reality

Researchers from the Institute for Quantum Computing (IQC) at the University of Waterloo led the development of a new extensible wiring technique capable of controlling superconducting quantum bits, representing a significant step towards to the realization of a scalable quantum computer.

"The quantum socket is a wiring method that uses three-dimensional wires based on spring-loaded pins to address individual qubits," said Jeremy Béjanin, a PhD...

Im Focus: Scientists develop a semiconductor nanocomposite material that moves in response to light

In a paper in Scientific Reports, a research team at Worcester Polytechnic Institute describes a novel light-activated phenomenon that could become the basis for applications as diverse as microscopic robotic grippers and more efficient solar cells.

A research team at Worcester Polytechnic Institute (WPI) has developed a revolutionary, light-activated semiconductor nanocomposite material that can be used...

Im Focus: Diamonds aren't forever: Sandia, Harvard team create first quantum computer bridge

By forcefully embedding two silicon atoms in a diamond matrix, Sandia researchers have demonstrated for the first time on a single chip all the components needed to create a quantum bridge to link quantum computers together.

"People have already built small quantum computers," says Sandia researcher Ryan Camacho. "Maybe the first useful one won't be a single giant quantum computer...

All Focus news of the innovation-report >>>



Event News

#IC2S2: When Social Science meets Computer Science - GESIS will host the IC2S2 conference 2017

14.10.2016 | Event News

Agricultural Trade Developments and Potentials in Central Asia and the South Caucasus

14.10.2016 | Event News

World Health Summit – Day Three: A Call to Action

12.10.2016 | Event News

Latest News

Ice shelf vibrations cause unusual waves in Antarctic atmosphere

25.10.2016 | Earth Sciences

Fluorescent holography: Upending the world of biological imaging

25.10.2016 | Power and Electrical Engineering

Etching Microstructures with Lasers

25.10.2016 | Process Engineering

More VideoLinks >>>