1. This allows me the opportunity to implore my friends at NASS to avoid the mistake they made last year by revising Sep 1 stocks later on without any new data. They did this last January, which is what Karen mentions here.
2. To recap: last January, USDA revised 2018/19 production, feed and residual use, AND ENDING STOCKS. This was a violation of what I previously thought was an unbreakable principle for a statistical agency in constructing crop balance sheets.
3. What is the unbreakable principle? Never, ever, ever change the quarterly stocks estimates after the fact without having Census data (and who really cares about that 5 years down the road?) This is supposed to be the number measured with the least error. Leave. It. Alone.
4. If the USDA has new data that leads to changes in past production (as it might today), that is fine. Make the revision. But make any corresponding change in usage to balance the balance sheet in feed and residual use and not in the stocks estimate.
5. Any other approach really just leads to a place where one has no idea which number can be safely assumed to be a "constant" in the balance sheet equation. This is not a good situation. Let any unresolved sampling errors reside in feed and residual use where it belongs.
6. You can read all about my tirade on this matter of balance sheet integrity in this #FDD from last January farmdocdaily.illinois.edu/2020/01/did-th…
7. Just to be clear, I am talking about revising the Sep 1 stocks estimates to be released today at some later point in the future. This is what they did with 2018/19 Sep 1 ending stocks in January 2020.
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