The Office of the Chief Economist released a report, “Agricultural Provisions of The U.S.-China Economic and Trade Agreement and USDA Trade Forecasts,” outlining how the Phase One trade agreement will – and will not – affect USDA trade forecasts for the monthly WASDE and other monthly, quarterly and annual reports.
While some have focused on the statement referenced more than once in the document that “commodity-specific commitments are not publicly available and are therefore not considered in the published forecasts,” it is important to note that the report also states, “Beginning in February 2020, USDA trade projections for 2019/20 (and Fiscal Year 2020) will fully consider all publicly available information on the Agreement, as well as any new market or policy developments that would affect those forecasts.”
As for the forecasts released at USDA’s Outlook Forum near Washington, DC, Feb. 20-21, and the first official 2020/21 forecasts in the May WASDE, the report states, “Both the initial forecasts released in February and the official May WASDE 2020/21 forecasts will incorporate the Agreement into the underlying analysis, along with all other relevant market and policy variables.”
Importantly, the report also notes, “As more information and data become available regarding the timing, volume and content of China’s commodity purchases, USDA commodity forecasts will be updated to reflect that new information.” This indicates that USDA analysts are being given no additional information beyond what has already been made public. But it also means they will be incorporating the information is available in their forecasts starting with the February WASDE report due on February 11.
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