1. When thinking about early season crop condition ratings for corn and soybeans I think there is a topic that does not get enough attention. It is the question of statistical bias. We have covered this issue in several of the #FDD articles I tweeted our earlier today.
2. Here is an updated chart from a 2017 article. Last minus first US (18 state) G+E rating for corn and soybeans. Fascinating patterns here. Statistically unbiased through late 90s, then a clear bias develops towards high early ratings.
3. Since 1999, condition ratings for corn have almost never gone up after the initial rating. That is rather remarkable. On average, they have dropped by 7 percentage points. Except for 2012, decline is usually no more than about 10 points.
4. Seems to me that for some reason USDA crop observers since late 90s have become more optimistic early in the season about crop potential. It sure has been highly persistent whatever the explanation.
5. One more point. There is also evidence that the statistical bias in early season crop condition ratings for corn and soybeans is a function of the level of the ratings. That is, the higher the early rating in an absolute sense the higher the bias.
6. Don't want folks to infer that I think that early season crop condition ratings are useless. I believe they do contain useful information after making appropriate adjustment for upward bias. Value of information increases with each week in the season then.
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