Trading Based On Knowing the Wasde Report in Advance

Abstract

Past research shows that prices move in response to World Agricultural Supply and Demand Estimates (WASDE) reports immediately prior to and after a report. This research develops trading models based on knowing the next WASDE report in advance. This should help traders evaluate investments to predict information contained within the report and in determining how best to use such forecasts. The price-forecasting models use regressions against the ratios of ending stocks to use. Results show a steady increasing return to trading over the report month. The highest returns are produced by trading during the growing and harvest seasons.