Miller Magazine Issue: 127 July 2020

92 MARKET ANALYSIS MILLER / JULY 2020 finally recover no earlier than 2025. In the United States, 71% of crops are in good and excellent condition, which exceeds the 5-year average. Egypt for the first time in 2 years bought a 49kMT boat of American corn. The EU has again zeroed the import duty on corn. The reserves of corn in the northern ports of China are minimal for the last 5 years, although their seasonal period begins. According to FAS USDA, COFCO, by September, buy another 1 MMT of corn of optional origin. At the same time, 6.6 MMT of the tariff quota has already been used. Private companies bought about 2.8 MMT of corn, and COFCO - 1.5 MMT in the USA and about 0.5 MMT in Ukraine. China's corn market activity may be a longer support factor. Brazil seasonally leaves the soybean market (whose supply, due to high production, still exceeds last year's) and goes to the corn market. Barley in the United States was also sown less than ex- pected. What the Chinese will get there is not clear, they themselves would be enough. According to FAS USDA forecasts, imports for 2020/21 will decrease by 500,000 tons to 5.5 million tons due to barriers to the import of Australian barley. From January to April this year, China imported 1.43 million tons of barley, which is 43.7 per- cent less than the same period last year. The French Ministry of Agriculture predicts a barley crop in France in 2020 at 12.33MMT, which is 10.3% lower than last year. Expectations of production of winter barley fell to 7.8 MMT compared with the forecast of 8.17 MMT last month. Canada expects to take Australia's place in the Chi- nese barley market. Despite expectations of a decline in production from 11.8 MMT last season to 9.7 MMT in 20/21, barley exports from Canada could grow by 1 MMT. The variability of the correspondence of USDA fore- casts to the final figures can be compared with the at- tempt of Nate Silver to analyze forecasts in the McLa- ughlin Group political show. Briefly - this is a talk show where smart people answer completely different ques- tions from McLaughin, and in the end he asks them to make a forecast on some issue that was relevant at the time of the broadcast. In general, one week before the Obama election, all the participants in the show, except for one, bet on McCain. For different reasons. And a week after Obama's victory , McLaughin gathered them again and no one remembered his unsuccessful forecast, only explaining after the fact his vision of losing to John McCain. In general, it hooked Silver and he hello everyt- hing in a tabular form. It turned out that “absolutely pre- cisely” 39% of the forecasts came true, and “absolutely incorrectly” - 37%. With the same success, you can toss a coin. Why a coin? Then I will strain you with a theory. The more analysts give clarifications and modifications to their forecasts, the higher the chance that one of them will hit the bull's-eye? “ Oh player error” is that many people misinterpret the law of large numbers. Coins, roulette wheels and dice have no memory of the past. Their behavior is not affected by what happened to them yesterday. And whether there is a memory in the market?