Weather Model Forecast Impacts and Yield Estimates

Yield_ForecastChange

CropProphet quantifies the impact of weather on crops to enable improved understanding of the weather risks and opportunities in grain trading markets. Our models provide grain yield and production forecasts based on “year-to-date” weather conditions. In other words, the yield and production forecasts are based on weather conditions that have happened so far this year.

Having quantified the impact of weather on crops, we can also quantify the forecasted impact on crops based on weather forecast information. The weather forecast information is converted into yield and production terms, the information that matters most to agricultural commodity market participants. Weather has different impacts on crops at different times and locations during the crop season. A person estimating the impact of the weather forecast models on crops on any day is a guessing game. CropProphet, however, systematically applies the weather forecast model data to provide a quantitative understanding of the impact of crops.

The futures market sometimes reacts to day-to-day changes in the weather forecast. For example, if a new forecast shows dramatically warmer temperatures over the coming two weeks, prices may rise because the forecast suggests a decline in crop production caused by the very warm temperatures.

CropProphet users benefit because the weather forecast information is presented in terms of the change in yield or production from the current yield/production forecast. Users to not need to guess what yield/production change is implied by the weather forecast models. We calculated that for you, improving interpretation of the weather forecast, and providing a trading advantage.