Despite a volatile year of climate events, environmental conditions, and market instability,&nbsp;Gro Intelligence’s proprietary models accurately predicted crop yields months ahead of end-of-season reports averaging between 92%-99% accuracy against final government reporting.&nbsp;&nbsp;&nbsp;Some highlights of Gro’s 2023 Performance Report include:<ul><li>For the past eight years, Gro’s US Corn Yield Forecast Model has been on average within 98% of the USDA final January report by September (three months in advance of final yield reporting).</li><li>Our US Soybean Yield Forecast Model has been on average within 99% of the USDA’s final number by September (i.e., three months in advance) since the model launched six years ago.</li><li>In regions where predictive modeling is not readily available or where data is hard to obtain — such as Ukraine, Brazil, and China — Gro’s 2023 Global Yield Forecast Models were on average 96% accurate up to 10 months ahead of final government reporting.</li></ul>

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2023 Performance Report: Gro Yield Forecast and Acreage Models

As extreme weather continues worldwide, monitoring and accurately quantifying hot and dry conditions can help quantitative and financial teams stay ahead of major commodity market movements. To address these needs, Gro Intelligence, an AI-driven data and analytics company helping businesses, financial institutions, and governments make better decisions on food security and climate risk, has built the Gro Drought Index (GDI). The GDI is a proprietary index of global drought and a high-signal indicator of major agricultural trends such as abandoned acres, yields, and prices.In this report, we explore two case studies where the GDI led futures prices and presented signals for profitable trades: US hard red winter wheat and US cotton.You will learn how:&nbsp;<ul><li>Quantitative and fundamental analysts can use the Gro Drought Index to focus on drought impact in crop-growing areas and anticipate potential threats to production and prices</li><li>Early on in a crop's growing season, the Gro Drought Index can provide an assessment of the potential for abandoned acres (a key indicator of price) in a growing region, down to the county level</li><li>There is a significant linear relationship between average monthly Gro Drought Index readings and the average monthly price of major agricultural commodities</li></ul><a href="https://info.gro-intelligence.com/using-the-gro-drought-index-as-a-high-signal-trading-indicator" target="_blank" rel="noopener noreferrer">Download the report here</a>.

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Using the Gro Drought Index as a High-Signal Trading Indicator for Agricultural Commodities

Gro Intelligence has over 2 million unique, proprietary data series that address a range of questions across crop yield and production, supply and demand, growing conditions, and climate scenarios. Gro's data series are built by our team of 50+ domain experts and scaled through artificial intelligence, generating predictive models and real-time applications. Our products provide accurate forecasts and holistic views into the most pressing challenges across climate, agriculture, and the economy.&nbsp;In this report, we focus on the performance of our Global Yield Forecast Models across corn, soy, and wheat, as well as our US Planting Intentions Model and US Prevent Plant Models for corn, soy, wheat, and cotton.&nbsp;You will learn how:&nbsp;<ul><li>Historically, for the past seven years, Gro’s US Corn Yield Forecast Model has been on average within 98.3% of the USDA final January report by September. Our US Soybean Yield Forecast Model has been on average within 99% of the USDA’s final number by September for the last four years.</li><li>In critical global regions, where the current marketplace does not have many machine learning-based predictive models, such as Ukraine, Brazil, and China, Gro’s 2022 Global Yield Forecast Models were on average 95% accurate up to 10 months ahead of final government reporting.</li><li>Gro’s suite of machine-learning models provide an unprecedented combination of accuracy, global coverage, granularity down to the district level, and daily in-season updates to enable our customers to move ahead of the market.</li></ul>Download the 2022 performance report <a href="https://info.gro-intelligence.com/2022-performance-report-on-yield-forecast-and-acreage-models?utm_campaign=End%20of%20the%20Year%20Report%20-%20January%202023&amp;utm_medium=email&amp;_hsmi=2&amp;_hsenc=p2ANqtz--DAawbx4JnPmIhs6GrNfist1fGwSINeh_jnpFQ9_1aaJrTOxCIMEY1Xq-DyHJPXbhZ9TUpn5frwnku07Tb0UXCk7b3NiU9gn6sw5XtheL7Ena6_aw&amp;utm_content=2&amp;utm_source=hs_email" target="_blank" rel="noopener noreferrer">here</a>.

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2022 Performance Report: Gro Yield Forecast Models and Acreage Models

In this report, we will talk about how to use growing and climate conditions in a systematic way to better anticipate impact on final yield throughout the growing season—from planting to harvest.&nbsp;<a href="https://info.gro-intelligence.com/incorporating-climate-into-agricultural-forecasting" target="_blank" rel="noopener noreferrer">Download the report here.</a>

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Incorporating Climate Into Agricultural Forecasting

Global vegetable oil prices have been on an upward trajectory for the better part of two years. The onset of the Russia-Ukraine war on February 24 caused prices to spike higher in volatile trading as Black Sea sunflower oil exports were halted by the conflict.In Gro’s latest Strategic Assessment, we address the impact of the Russia-Ukraine war on global vegetable oil markets. We show how vegetable oil supplies face renewed risks in several countries, which will continue to weigh on global markets, and how industry pressures may keep prices elevated for some time to come.You will learn:<ul><li>Why global vegetable oil production has struggled to keep up with rising consumption</li><li>How the Russia-Ukraine war and increasing demand for biofuels have exacerbated concerns about global vegetable oil supplies</li><li>How to monitor global production prospects to forecast potential impacts to the vegetable oil market</li></ul>&nbsp;<a href="https://info.gro-intelligence.com/russia-ukraine-war-vegetable-oil-prices" target="_blank" rel="noopener noreferrer">Download the Strategic Assessment</a>

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Fuel for the Fire: The Russia-Ukraine War and Vegetable Oil Prices

The Russia-Ukraine war is causing vast destruction and human suffering in Ukraine. It is also reverberating through global food supply chains by disrupting shipments of Black Sea wheat, vegetable oils, corn, barley, and fertilizers.<ul><li>Agricultural commodity prices have surged in volatile trading</li><li>Import-reliant countries are scrambling for alternative supplies</li><li>Energy prices have jumped, with crude oil topping $100 a barrel&nbsp;</li></ul>In this Gro Strategic Assessment, we quantify the impact the Russia-Ukraine war is having on global inventories of agricultural commodities. We also evaluate how much other world regions are able to increase their exports to help fill the supply shortfalls created by the war. <a href="https://info.gro-intelligence.com/russia-ukraine-crisis-driving-global-food-shocks" target="_blank" rel="noopener noreferrer">Download the full Strategic Assessment here</a>.

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Russia-Ukraine Crisis Driving Global Food Shocks

Food price inflation is at its highest level in a decade. Successive years of poor growing conditions across several key commodities, coupled with strong demand, have pulled down agricultural product inventories worldwide to their tightest levels in years and driven prices higher. As many nations’ economies continue to recover from COVID-19, and issues ranging from labor shortages to intense drought emerge, the current period of high prices could be with us well into 2022 and beyond.&nbsp;One of the strongest signals for continued food inflation is a second consecutive year of drought in agricultural powerhouse South America, brought on by the return of the La Niña weather event. Big producers Brazil and Argentina are headed for smaller harvests of major crops, especially corn, soybeans, and sugar, Gro’s machine-learning models show. Even a robust US harvest from the upcoming season won’t be able to make up for the depth of South America’s current crop troubles.As a result, global supplies of many commodities will remain tight, and food prices, already soaring in most parts of the world, will remain elevated through yet another global crop cycle.Background&nbsp;A broad acceleration of food price inflation in the US has been underway since May 2020, around the beginning of the COVID lockdowns. Gro’s <a href="https://app.gro-intelligence.com/displays/adGLM2DqZ">US Food Price Index</a>, which reflects prices based on consumption of a wide range of food items, is up 30% from this time last year.&nbsp;<ul><li>The index’s increase signals a continuation of intense inflationary pressure on basic food necessities such as proteins and grains used in making a wide variety of packaged food products.&nbsp;</li><li>Rising US food prices have global impact, given the outsize role of the US in worldwide food and agricultural markets.&nbsp;</li><li>The <a href="https://gro-intelligence.com/models/us-ag-price-index">Gro US Food Price Index</a> updates daily and provides an inflation estimate for the current month, which is up to six weeks ahead of when official US government data becomes available.&nbsp;</li></ul>The biggest drivers of US food price inflation are meat and poultry.&nbsp;<ul><li>Wholesale <a href="https://app.gro-intelligence.com/displays/Vq6131NdW">US beef prices</a> rose 25% in 2021 from the previous year, while <a href="https://app.gro-intelligence.com/displays/wRDvQmzdV">poultry prices</a> doubled, putting sharp upward pressure on retail prices as well.&nbsp;</li><li>Since late December 2021, US pork cold storage levels fell to 21% below five-year average levels. As boneless hams require more labor to remove the bone, they were in even <a href="https://app.gro-intelligence.com/displays/VqeWwVZ9L">tighter supply.</a>&nbsp;</li></ul>Robust consumer demand as economies pick up steam is driving protein prices higher, while labor shortages have restricted protein processor production.&nbsp;<ul><li>Sharply higher animal feed costs have also pushed up protein prices.&nbsp;</li><li><a href="https://app.gro-intelligence.com/displays/kqzK7blRW">Corn futures</a> prices are up 5.5% so far in 2022, and up 35% year over year. <a href="https://app.gro-intelligence.com/displays/gR80VG8Re">Soybean prices</a> have risen even more, gaining 17% so far in 2022 and 38% compared with last year.&nbsp;</li><li>Droughts in Brazil, Canada, and the US, along with unprecedented demand from China, <a href="https://app.gro-intelligence.com/displays/o9vPWnKqb">tightened global supplies</a> of grains and oilseeds used in animal feed.&nbsp;</li></ul><a href="https://app.gro-intelligence.com/displays/eRJpoBodV">Milk prices</a> are up 31% year over year, also due to higher feed costs.<figure class="image image-style-align-center image_resized" style="width:75.58%;"><img src="https://res.cloudinary.com/gro-intelligence/image/upload/v1644416385/new-website/image1_738b8a06c2.jpg"><figcaption>Wholesale chicken breast prices have soared amid lower supplies and rising feed costs, contributing to a 30% year-over-year jump in Gro’s US Food Price Index.</figcaption></figure>Higher Prices WorldwideVegetable oils are one of the most common commodities around the world, used widely in cooking and as ingredients in nearly every packaged food product. But as global <a href="https://app.gro-intelligence.com/displays/oq1QMmKqW">vegetable oil supplies </a>tighten, <a href="https://app.gro-intelligence.com/displays/V9NBojk9b">prices have risen</a> substantially for more than a year, hitting profit margins of packaged food manufacturers.&nbsp;<ul><li>Gro’s VegOil Feedstock Price Index, which tracks price changes in various edible oils, is up 41.8% in January from a year earlier.&nbsp;</li><li>The index is part of Gro’s newly launched <a href="https://gro-intelligence.com/models/custom-price-indices">Custom Price Indices application</a>, which enables food manufacturers to create price indices of key ingredients, using customer-selected inputs and weights, and track inflationary pressures.</li></ul>Potato prices in the US are up 20% year over year, amid declining production and supply chain disruptions around the world.&nbsp;<ul><li><a href="https://gro-intelligence.com/insights/us-potato-production-decline-deepens-global-supply-shortage">US potato production</a> in 2021 was 7% below the five-year average as severe drought in several states resulted in the worst potato yields in years. The No. 1 producing state, Idaho, saw yields drop 9%.</li><li>Port disruptions and weak harvests created french fry shortages in markets from Japan to Kenya.</li><li>North American potato trade flows were curtailed after a potato wart outbreak prompted an export ban from Prince Edward Island, Canada’s largest potato producing province.</li></ul>Food inflation has taken hold worldwide, with year-over-year prices up 8% in Canada and 5% in Brazil, according to <a href="https://app.gro-intelligence.com/displays/oq1QB6vqW">Gro’s Food Price Indices for those countries</a>.&nbsp;<ul><li>Gro’s Brazil Food Price Index is close to its highest level ever, and is up 63% since the first set of COVID-related lockdowns in Brazil in May 2020.&nbsp;</li><li>Food price increases in Brazil have been exacerbated by the depreciation of the Real, which is down 15% over the past two years.</li></ul>Rising prices have prompted some countries to restrict commodity exports in order to maintain domestic supplies and quell food price inflation.&nbsp;<ul><li><a href="https://gro-intelligence.com/insights/indonesia-s-palm-oil-export-curbs-will-squeeze-global-supplies">Indonesia</a>, the world’s largest producer and exporter of palm oil, announced curbs on palm oil exports.&nbsp;</li><li>Other countries, including <a href="https://gro-intelligence.com/insights/russia-ramps-up-wheat-export-restrictions">Russia</a> and <a href="https://gro-intelligence.com/insights/argentina-to-cap-corn-and-wheat-exports-amid-forecast-for-record-crops">Argentina</a>, have restricted grain exports.&nbsp;</li><li>Such measures could further tighten global supplies and create additional upward pressure for food prices.</li></ul><figure class="image image-style-align-center image_resized" style="width:74.72%;"><img src="https://res.cloudinary.com/gro-intelligence/image/upload/v1644416608/new-website/image3_2e19cb459e.jpg"><figcaption>Tightening global supplies of vegetable oils, one of the most widely used commodities, have pushed prices sharply higher, hitting profit margins of packaged food manufacturers.&nbsp; Gro’s VegOil Feedstock Price Index, which tracks price changes in various edible oils, is up 41.8% in January from a year earlier.</figcaption></figure>Headed Into 2022: South America Drives Global MarketsBig agricultural producers Brazil and Argentina are headed for smaller harvests of major crops, especially corn, soybeans, and sugar, Gro’s machine-learning models show.&nbsp;<ul><li>The result will be a continuation of tight global supplies for many commodities.&nbsp;</li><li>Food prices, already soaring in most parts of the world, will remain elevated through yet another global crop cycle.&nbsp;</li><li>Brazil is the world’s largest soybean producer and exporter. It is also the No. 1 producer and exporter of sugar and Arabica coffee.</li><li>Argentina is the world’s largest exporter of soybean oil and soybean meal as well as a major supplier of corn to world markets.&nbsp;</li></ul>A return of the La Niña global climate event is bringing another year of drought to key growing regions in Argentina and southern Brazil.&nbsp;<ul><li><a href="https://app.gro-intelligence.com/displays/6qAxMrgd4">Gro’s Brazil Soybean Yield Forecast Model</a> currently indicates a sizable production decline.&nbsp;</li><li>Gro’s yield forecast models for <a href="https://app.gro-intelligence.com/displays/WdK0XbrqK">Argentina corn</a> and <a href="https://app.gro-intelligence.com/displays/V9NB6aD9b">soybeans</a> currently show both crops will be down by double-digit percentages year over year.</li><li>Gro’s forecasts for South America are based on our extensive platform of data analytics, indices, and machine-learning models that have proved to be more reliable than government estimates and are available weeks or months earlier than official reports.</li></ul>Gro’s new Strategic Assessment, “<a href="https://info.gro-intelligence.com/south-america-outlook-2022">2022: The Year South America Drives Global Agricultural Markets</a>,” which is available for download, offers an in-depth look at the current South American season’s prospects. &nbsp;<figure class="image image-style-align-center image_resized" style="width:75.04%;"><img src="https://res.cloudinary.com/gro-intelligence/image/upload/v1644416573/new-website/image2_5f2440a6b3.jpg"><figcaption>A second consecutive year of drought in southern Brazil is depressing yields and production forecasts for the country’s big soybean crop, as shown via the Gro Drought Index. Brazil is the world’s largest producer and exporter of soybeans.</figcaption></figure>ConclusionYears of major agricultural product inventory reductions coupled with strong demand have led to rising food inflation worldwide. An expected shortfall in South American production this season could exacerbate global supply shortages, prolonging inflationary pressures for food well into the new year.&nbsp;US farmers can be expected to increase their total planted acreage of corn and soybeans, despite sharply elevated fertilizer prices, as crop shortfalls in South America prolong high commodity prices. But even a strong US harvest later this year won’t be sufficient to offset the damage already done to South American crops due to drought, Gro’s models show.&nbsp;The result will be a continuation of tight global supplies for many commodities and persistent food price inflation through yet another global crop cycle. Additional increases in food prices in 2022 will hit consumers and further squeeze profit margins for food manufacturing and merchandising companies worldwide.

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A Look at Rising Food Inflation

Agricultural powerhouse South America will have a greater-than-normal impact on global markets in 2022, a <a href="https://info.gro-intelligence.com/south-america-outlook-2022">new Gro Strategic Assessment</a> concludes.&nbsp;&nbsp;

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2022: The Year South America Drives Global Agricultural Markets

<a href="https://info.gro-intelligence.com/2021-performance-report-on-yield-forecast-and-acreage-models" target="_blank" rel="noopener noreferrer">Read the full report</a> on the performance of our Yield Forecast Models and Planted Acreage Models.

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2021 Performance Report: Gro's Yield Forecast Models and Acreage Models

Download Gro’s complete January Supply and Demand Forecasts report in PDF form <a href="https://info.gro-intelligence.com/gro-global-supply-and-demand-forecasts" target="_blank" rel="noopener noreferrer">here</a>.

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Gro's January Supply and Demand Forecasts

Currently about 20% of worldwide production of many staple crops, totaling nearly $300 billion, are lost each year to pests and diseases. Climate change is expected to bring about higher temperatures, altered precipitation patterns, and more extreme-weather events globally. As a consequence, changes in local agricultural ecosystems could encourage greater pathogen development and food contamination.In this Gro Strategic Assessment, our domain experts analyze the impact of the most destructive plant pests and diseases on global agriculture and explore what effects climate change may bring. Our team also shows how Gro Intelligence is applying its machine-learning predictive models to help companies, governments, and aid organizations battle ongoing pest and disease infestations.<a href="https://info.gro-intelligence.com/managing-climate-risk-for-plant-pests-and-diseases-g">Download here</a>In this Strategic Assessment, you will see:Climate change’s impact on pests and diseases like fall armyworm, locusts, aflatoxin, and Brazil Asian soybean rustRecent outbreaks and their impact on supply chains globallyGro Intelligence’s models such as the Gro Drought Index and Global Climate Model and how they’re used to provide early warning signals for plant pests and diseases<figure class="image"><a href="https://info.gro-intelligence.com/managing-climate-risk-for-plant-pests-and-diseases-g"><img src="https://res.cloudinary.com/gro-intelligence/image/upload/v1628209115/pdgmptvjjptlfmq7k8q1.png" alt="Gro Strategic Assessment"></a></figure><a href="https://info.gro-intelligence.com/managing-climate-risk-for-plant-pests-and-diseases-g">Download here</a>&nbsp;

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Managing Climate Risk for Plant Pests and Diseases: Download the Strategic Assessment

Gro Reports