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An economics article notes US government farm aid is expected to reach $37.2 billion in 2020, well above recent averages. Most of the 2020 aid runs through CFAP1 and CFAP2, mainly to corn, soybean and cattle producers.
Large payments support farm incomes and can keep production going despite low prices, which is a bearish factor for corn and soy prices over time.
asmith.ucdavis.eduAaron David Smith
October 21, 2020Oct 21, 2020After 310 past bearish policy events, Corn moved a median +0.3% over 5 sessions (54% higher; middle half -1.4% to +1.9%), and +0.6% over 20.
After 369 past bearish policy events, Soybeans moved a median -0.2% over 5 sessions (46% higher; middle half -1.7% to +1.8%), and +0.8% over 20.
After 102 past neutral policy events, Live Cattle moved a median +0.6% over 5 sessions (63% higher; middle half -0.7% to +1.2%), and +1.3% over 20.
Moves of each commodity's benchmark from the last close before the event. Historical reads pool past events of the same kind; they describe what happened, not what will. Not investment advice.
