Grains

Experience and Expertise

Our economists offer specialised expertise and objective analysis on the full range of issues affecting the grains sector. Our goal is to help clients to plan effectively and successfully: to identify and seize opportunities and pre-empt threats, whether this is through the establishment or expansion of new wet or dry milling projects, or responding to policy changes or changes in demand.

A sample of the broad range of types of LMC consultancy services we can provide is given below.

Market and price forecasting

An analysis of the linkage between energy prices and commodity prices

The report analysed historical trends and determining if historical price cycles can be expected to continue. The analysis was based on patterns/forecasts of energy use and supply.

Evaluation of the Common Market Organisation (CMO) for the cereal sector for the European Commission

This high profile and very large project completed in 2005, involved a comprehensive review and analysis of all of the main cereal crops in the EU. The project examined the effectiveness and efficiency of the Cereals CMO and associated policy instruments; these measures were evaluated both individually and as a package of instruments taken collectively. LMC acted as the lead contractor undertaking the bulk of the work. Sub-contractors were used for specific country reports in France, Germany, Italy, Spain, Denmark, Hungary and Poland.

Hedging model for corn and sugar

Development of a hedging model for sugar and corn as part of a risk management tool for hedging the costs and margins of a major fermentation operation.

Hedging of corn input requirements

In a study for a US corn processor, LMC undertook a detailed examination of the hedging strategy for maize and corn wet milling by-products. This consisted of the econometric analysis of the structure of Chicago corn futures carries and inversions, and their associated seasonality. The use of "tailing" to hedge the financial costs of meeting margin calls and an analysis of by-product credits achieved from corn wet milling in order to derive the best hedging strategy to employ for these credits.

The EU market for Vital Gluten

The study provided an overview of EU producers of wheat starch and gluten (plant capacities, estimated production). LMC’s view as to how policy changes (sugar reform and growing ethanol production) will affect EU vital gluten supply was given. The report also gave an assessment of the cost of wheat starch production in the EU.

Benchmarking performance & competitiveness

North American corn wet milling plants in the US and Canada

This study provided a detailed breakdown of production capacities for starches, sweeteners and ethanol in the USA and Canada.

Production cost and gross margin estimates for arable crops in Russia and the Ukraine

Production cost and gross margin estimates for the major arable crops for the EU-27

Value chain analysis

The value chain for ethanol from raw material through to the final product

This included value chain analysis from maize to ethanol in the USA and wheat to ethanol in the EU.

Grains trade flow database

LMC was commissioned to construct a database covering export shipments of five grain categories –- wheat, maize, sorghum, barley, and oats and rye – from major exporting ports of the world, providing monthly data. Particular attention was devoted to breaking down trade from zones of North America, four in the USA and three in Canada.

International and national policies

Durum Wheat - Evaluation of measures within EU Common Agricultural Policy

A comprehensive report of an EU project evaluating the impact of Common Agricultural Policy (CAP) measures applied in the protein crop sector. Completed in 2009, the project examined the effectiveness, efficiency and relevance of the protein crop measures in achieving their objectives and their coherence with the reformed CAP after 2003 and its impact in the EU-27. As lead contractor, LMC undertook the bulk of the work with sub-contractors contributing specific country reports in France, Germany, Spain, Hungary and Poland.

Protein Crop - Evaluation of measures within EU Common Agricultural Policy

Wheat, Barley, and Durum trade issues

This study, undertaken for a US trade organisation, examined trade issues raised by the cross-border trade in wheat and coarse grains between Canada and the US. It assessed in detail how the provisions of the Canada-US Free Trade Agreement and the differences in grain marketing systems in the two countries interacted in practice.

Decoupled payments and the implications for the EU grain market

A study that examined the ways in which the EU has tackled the issues of high grain prices and costly storage facilities and is making the transition to a system that is decoupling payments to farmers from the level of domestic market prices. As a result, local prices are now much closer to (though not quite in line with) world market prices.

Grains

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