The U.S. Department of Agriculture may eliminate a range of crop reports watched by farmers, commodity traders and foreign buyers to gauge supplies coming from the world's largest grain producer.
An agency official confirmed the USDA may cut its weekly progress reports that track the development of corn, soybeans and other crops, among other possible cutbacks. Some form of cutbacks is a forgone conclusion, with department officials scheduled to meet Thursday to discuss a list of reductions, said Jacqueline Moore, head of the field crops section for the USDA's National Agricultural Statistics Service, in an interview.
Driving the expected cuts in USDA data is a broad push in Congress to reduce government spending. Funding issues already have led the U.S. Census Bureau to announce it will stop publishing closely followed soybean processing data.
Less data from a government source could mean increased volatility in prices and greater power for the large grain companies that have a unique view of supply and demand most farmers, traders and analysts can't replicate. Prices for agricultural commodities have swung wildly in recent years, with corn surging more than a 100% since last summer to set record highs this week.
Government officials are bracing for a shutdown assuming Congress doesn't pass a budget by the end of the day Friday. Ms. Moore said the extent of the USDA's cuts depend on the government's final budget, which remains up in the air. The spending cuts could carry through to future years, making any reductions in data permanent.
"Do we cut back on the samples we do, or do we not do the first month of a forecast?"Ms. Moore asked.
The crop progress report that is being considered for elimination gives details on planting rates, crop development and harvesting. The USDA also is looking at cutting back on its June crop report, which gives a clearer picture of how many acres farmers planted of various crops. It follows a March report that also gives plantings estimates.
For the June report, the USDA might curtail the amount of surveying it does to reduce costs, Ms. Moore said.
Although the weekly progress reports are monitored by traders, they sometimes have little effect on the markets. Some traders criticized the reports last year, saying the subjective "good to excellent" ratings for various crops didn't prove to be an accurate indicator of final yields.
Still, Dan Basse, president of advisory firm AgResource Co. in Chicago, said the USDA reports provide vital data for a breadth of market participants. Without such reports, the market would revert "back to the 1970s, when three or four major grain companies had all the information, and the rest of us are on the outside looking in."
Mr. Basse and other analysts are lobbying the USDA not to cut the reports. He said in an interview that the USDA was considering cuts to a variety of other reports as well, including cattle, pigs and nuts.
Yet views on the importance of USDA data aren't universal. Eliminating data would create short-term volatility but ultimately the market would adjust, said Don Roose, president of U.S. Commodities, a brokerage firm in Iowa.
With all the other forms of communication now, including social networking, the need for such reports might not be as great, Mr. Roose said.
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