CHICAGO, Ill. (Reuters) — The American Farm Bureau Federation, an agricultural trade group, says confidence is fading in the United States Department of Agriculture’s most market-sensitive crop reports, and the government should respond by modernizing its technology and improving transparency.
The Farm Bureau released recommendations last month following a four-month review by 10 of its farmer members into key reports released by the USDA’s National Agricultural Statistics Service.
Many of these reports, which are closely monitored by global grain traders, are based on statistical surveys of thousands of U.S. farmers who are queried about crop area, yields and grain inventories. The USDA also has its own “enumerators” who conduct field surveys to help determine the size of U.S. crops.
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“While NASS may have a gold standard reputation for agriculture statistics globally, U.S. farmers’ confidence in their reports has unfortunately declined,” Farm Bureau President Zippy Duvall said in a statement.
Duvall noted “large changes” in some of the USDA’s supply estimates over the last two years due in part to adverse weather, including historic flooding that delayed planting in 2019. The USDA’s crop revisions caused market volatility and “left farmers questioning the agency’s ability to respond quickly to rapidly changing conditions on the ground,” Duvall said.
The latest jolt to markets occurred on Jan. 12 when the USDA’s estimates of the U.S. 2020 average corn yield and Dec. 1 stocks fell below a range of trade expectations, sending corn prices soaring.
The USDA said it is addressing the Farm Bureau’s recommendations.
“We feel confident the items recommended in the report either are being addressed or are underway, and we look forward to enhancing our communications in the near future,” NASS said in a statement.
The Farm Bureau said the USDA should explain the methodology of its reports more clearly and highlight major revisions to previous estimates. It also recommended that the government improve its technology and software to help keep pace with markets dominated by high-speed computers and algorithms.
