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PIRA Energy Group is expanding its commodities market coverage into the agricultural sector. With the launch of the new Agricultural Commodities Retainer Service (ACRS), PIRA offers fundamentals analysis on “Ags” in a fashion similar to our energy-related retainer services. ACRS is designed to keep clients up to date on global agricultural markets and ever-changing production and demand estimates, while offering insights on financial, as well as physical, trading opportunities through detailed price forecasts.
The service is centered on corn, soybeans, soy products, and wheat, but coverage of other commodities such as cattle, hogs, and ethanol is also part of ACRS, as these commodities relate to demand for the underlying grains and oilseeds. While primarily quantitative in nature, ACRS also offers a unique view into the minds of major global farmers and ags professionals on everything from fertilizer purchases and application tendencies to crop and seed choices. Analysis is provided through timely reports and data sets, along with direct access to PIRA’s agriculture analysts.
PIRA established its reputation in the energy sector through exhaustive bottom-up analysis of supply and demand, and how factors such as macroeconomics, speculative trading, weather, and legislation affect fundamentals. This same approach is easily applied to agriculture markets. Further supporting PIRA's knowledge of this sector is PIRA’s successful global biofuels practice, through which PIRA has already developed expertise on agriculture fundamentals.
PIRA is also entering this new venture with vital, hands-on experience. ACRS is supervised by Pete Meyer, who has been active in commodities for over 30 years, concentrating exclusively on agriculture for the past 15 years. Pete, who joined PIRA in early 2012, is known throughout the agriculture trading industry for his frank market commentary — “Opening Print” — and his broad contacts in the sector. This connectivity affords him key communication with producers throughout the critical stages of plant development and harvest. Pete’s work has come to be relied on for its accurate and timely estimates of corn and soybean production. These estimates, which are now the foundation of ACRS, are based on historical, meteorological, and agronomic analyses as well as empirical data obtained through hands-on sampling of major crops.
Existing PIRA clients who buy ACRS will have the further advantage of a single point of contact for their energy and agricultural analysis. Besides simple convenience, discounts for multiple-service retainer packages provide optimal value.
Opening Print (OP) is the cornerstone of ACRS. Typically released three times a week before the markets open, OP keeps clients current on ever-changing market dynamics by offering a unique perspective as well as PIRA’s near-term price targets. From analysis of weekly market-sensitive data releases, to interpretation of recent price movements, to weather forecast changes and cash market updates, OP is a concise update with timely, actionable information. During harvests and crop tours, OP is issued as frequently as five times a week “from the field,” with real-time reports on yield expectations.
The Weekly Ags Scorecard complements Opening Print with relevant charts and graphs as well as PIRA’s 30-day outlook. During the growing seasons, special attention is given to weather forecasts and soil conditions heading into the weekends. The Scorecard takes a deeper dive into the weekly Crop Progress reports issued by the National Agriculture Statistics Service from April through November. Released each Friday, the Scorecard also summarizes the USDA’s Export Sales and Inspections reports and other information previously disseminated in Opening Print.
WASDE Preview reports are usually issued two trading days prior to the release of the USDA’s monthly World Agricultural Supply and Demand Estimates (WASDE) reports. This deliverable focuses on what to expect in the upcoming WASDE report while also providing comparisons to the previous month. The Preview includes PIRA’s estimates of all of the WASDE components, including corn, soybeans, soybean meal, soybean oil, and wheat. Forecast changes in production, demand factors, and near-term and medium-term price forecasts are highlighted in the Preview. Analysis includes expectations from commercial trading entities and polls conducted throughout the industry. The Preview also looks at developments since the previous issue, including analysis of relevant cattle and hog reports, ethanol production, and export figures. These monthly reports include both empirical evidence and anecdotal observations from a wide variety of producers and agriculture professionals.
PIRA conducts conference calls for ACRS clients approximately one hour after the release of critical WASDE reports to discuss and examine the numbers before the markets open. During the U.S. growing season, the calls may feature a major corn and soybean producer or other agri-business professional for their impressions of the report and a “reality check” on the production numbers. Clients receive notice of the calls — and if a producer will be joining — through the WASDE Preview and Opening Print. These calls give the client a unique perspective “from the farm” and direct access to a cross section of American farmers. The calls will be held monthly or more frequently as events dictate. During “off-season” calls, topics include seed performance, purchase tendencies in fertilizers, and crop rotation for the following season. Clients are encouraged to interact with both the moderator and the guest, anonymously if desired.
The Pro Farmer Crop Tour takes place annually in late August and is arguably the most important week of the year for compiling yield data on U.S. corn and soybean crops. Typically, over 1,000 field samples are taken by almost 100 crop scouts, from Ohio to South Dakota, in an effort to estimate U.S. corn and soybean production. PIRA issues updates each evening from the Tour through the Opening Print, giving clients real-time access to that day’s data as well as overall impressions on a state-by-state basis.
PIRA houses all the ACRS deliverables (current and archived) in a dedicated, easy-to-navigate Web portal. In addition to analytical reports, the ACRS Portal contains the following statistical information:
Clients can obtain timely analytical support and anecdotal observations by communicating directly with PIRA analysts to obtain the latest thinking on short-term grain and oilseed markets or to gather market information and data.
For the first time, PIRA’s Annual Retainer Client Seminar will include reviews and forecasts of major agricultural commodities. Held every October in New York City, the Seminar presents an opportune time to review findings from the Crop Tour and to discuss the upcoming U.S. harvest season. Since 1977, the Seminar has presented PIRA’s medium- and long-term views on oil, natural gas, coal, electricity, and emissions. It has become the energy commodity event, where PIRA clients have the opportunity to interact with PIRA staff as well as industry colleagues from around the world. (Note: Only those ACRS clients also receiving Global Oil, North American Natural Gas, or North American Electric Power retainers receive Seminar invitations.)
Pete Meyer, Senior Director, leads PIRA’s agricultural commodity analysis. His career in commodities spans over 30 years, and he has concentrated on agriculture for the past 15 years. Prior to joining PIRA in February 2012, Pete held the position of Agricultural Commodities Specialist at Lehman Brothers and then JP Morgan, where he worked with a wide variety of clients, from hedge funds and pensions to energy companies and protein producers. Prior to those positions, he spent 14 years on the floors of the Chicago Board of Trade and the Chicago Mercantile Exchange, trading on behalf of diverse clients as well as proprietarily.
Pete’s pragmatic approach to analysis is widely respected by commodity traders, equity traders, and investors. He is a long-standing member of Pro Farmer, and he participates annually as a scout on crop tours. Pete's extensive interaction with farmers gives his readers a unique insight into the minds of some of the largest corn and soybean producers. He is also a frequent presenter at a variety of agriculture conferences and is often sought after by the media for his opinions and yield estimates.
The Agriculture Commodities Retainer Service can be purchased on its own or, at a discount, as an addition to a company's exiting PIRA retainer service. For options and fees, please contact your PIRA sales representative.