Impact: 
Low
Next Release:
Forecast:
Period:
Dec 2015
What Does It Measure?
The WASDE (World Agricultural Supply and Demand Estimates) report measures the supply and demand dynamics of major agricultural commodities like corn, soybeans, wheat, and rice, explicitly providing forecasts for production, consumption, exports, and ending stocks. It focuses on the agricultural sector’s key components, assessing how various factors impact both national and global markets.
Frequency
The WASDE report is released monthly, typically on the second Tuesday of each month, and provides the latest assessments based on current market conditions; it is issued as a preliminary estimate and is subject to revisions in subsequent reports.
Why Do Traders Care?
Traders pay close attention to the WASDE report due to its significant influence on commodity prices and agricultural sectors; unexpected changes in supply and demand forecasts can drastically affect market sentiment and lead to movements in futures contracts for grains, impacts on currencies related to commodity exports, and ultimately influence stock prices of agribusiness firms. Its timely updates are crucial for forecasting trends and making trading decisions.
What Is It Derived From?
The WASDE report is derived from comprehensive data gathered from various sources, including surveys of farmers, reports from governmental agencies, and analysis of previous market trends. It employs methodologies such as linear projections for yield estimates and incorporates factors like weather forecasts, planting intentions, and historical data to calculate supply and demand metrics.
Description
The WASDE report produces preliminary estimates based on the latest agricultural data and is later revised for accuracy, with financial markets often reacting more vigorously to the preliminary release due to its immediate relevance. It predominantly uses year-over-year (YoY) comparisons to mitigate seasonal effects and reveal long-term market trends, providing traders with clearer insights into the structural changes in the agricultural sector.
Additional Notes
The WASDE report serves as a coincident economic indicator, reflecting real-time conditions in agricultural markets and influencing broader economic activities in the sector. There are important correlations with other agricultural reports and climate data, and it is closely monitored globally to gauge food security and commodity pricing among different regions.
Bullish or Bearish for Currency and Stocks
If actual values exceed forecasts, it could be classified as higher than expected: Bullish for commodities-related currencies like CAD, Bearish for agricultural stocks due to potential increased supply limiting prices. Conversely, if actual values dip below expectations, it would be lower than expected: Bearish for currencies related to agricultural exports, Bullish for stocks, as the reduced supply may signal potential price increases or higher profit margins for agribusinesses.
Legend
High Potential Impact
This event has a strong potential to move markets significantly. If the 'Actual' value differs enough from the forecast or if the 'Previous' value is significantly revised, it signals new information that markets may rapidly adjust to.
Medium Potential Impact
This event may cause moderate market movement, especially if the 'Actual' deviates from the forecast or there's a notable revision to the 'Previous' value.
Low Potential Impact
This event is unlikely to affect market pricing unless there's an unexpected surprise or a major revision to prior data.
Surprise - Currency May Strengthen
Actual deviated from Forecast on a medium or high impact event and historically could strengthen the currency.
Surprise - Currency May Weaken
Actual deviated from Forcast on a medium or high impact event and historically could weaken the currency.
Big Surprise - Currency More Likely To Strengthen
'Actual' deviated from 'Forecast' more than 75% of historical deviations on a medium or high impact event and may likely strengthen the currency.
Big Surprise - Currency More Likely To Weaken
'Actual' deviated from 'Forecast' more than 75% of historical deviations on a medium or high impact event and may likely weaken the currency
| Green Number |
Better than forecast for the currency (or previous revise better) |
| Red Number |
Worse than forecast for the currency (or previous revise better) |
| Hawkish |
Supports higher interest rates to fight inflation, strengthening the currency but weighing on stocks. |
| Dovish |
Favors lower rates to boost growth, weakening the currency but lifting stocks. |
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