Another two-handed economist post...

Originally published 21 July 2011

Producers of cotton, wheat flour and livestock feed are searching for ways to avoid losing U.S. Census Bureau reports critical to their industries that are slated to be discontinued due to budget cuts.

A coalition of agricultural trade associations met Wednesday with the top economist of the U.S Department of Agriculture to discuss attempts to save the reports. Time is running out to find a solution, as some will be stopped after next month.

source: Morningstar.

I agree that these reports are very important to the markets. I've long said that the abundance of USDA and Census information on agricultural production and consumption greatly levels the playing field between the largest traders and other participants in the markets. Because of these reports, and others that NASS is now having to reconsider, there is a huge amount of data available to even the lowliest, brokest, land-grant university-based analyst. Nevertheless, the major players still have more information.

But reading the article brings two thoughts to mind. First, if these reports truly are so important to such major actors in the industry, then how can they not be worth $80,000/year to an industry association as a whole? That is the cost of one secretary in their DC office. Alternatively, if these are so important, why doesn't the United Soybean Board (who receives the national check-off for soybean sales, $82m in 2010) or a coalition of state wheat associations and/or marketing programs fund these?

More fundamentally, why is agriculture different? While I know that the Energy Information Administration provides copious amounts of data on oil and other energy markets, other commodity markets (base & precious metals) seem to function fine without the large investment in public data generation and dissemination. This is not to say that I'm opposed to these reports, or think that they are a bad idea. Just some questions and observations.