The August World Agricultural Supply and Demand Estimates (WASDE) from the U.S. Department of Agriculture (USDA) often results in crop market price volatility. The August WASDE is significant because the USDA collects updated information on planted acres and projected yields for the major U.S. crops.
In August, the USDA Farm Service Agency (FSA) begins reporting planted acreage information collected from farm managers enrolled in federal farm programs. The USDA National Agricultural Statistics Service (NASS) compares this information with the voluntary survey data collected from farm managers for the Acreage report, which is released at the end of June. These two data sources never result in exactly the same values because some U.S. farmers do not enroll in federal farm programs. However, the FSA planted acreage report provides another reference point to refine the planted and harvested acreage estimates in the August WASDE.
In addition, the August WASDE incorporates crop yield estimates collected directly from farm managers, rather than using the historical trendline yield forecasts. The NASS surveys approximately 14,900 farm managers across the U.S., asking for their estimate of crop yields. The survey is conducted during the last week of July and the first week of August. This information is summarized in the August Production report, and the updated national average yield estimates for the major crops are incorporated into the WASDE.
Private market analysts and traders also prepare their own forecasts for what they believe the USDA WASDE and Production reports will show. Major news agencies usually survey these individuals and organizations and report the average trade estimate, as well as the highest and lowest values, to provide a range estimate.
Source : ndsu.edu