1. Gather round. Today's lesson is on regional ag politics. Chart below compares price changes forecast for 2018/19 between May and August by WASDE and MPP trade assistance payment rates. 
2. I fully admit that figuring out tariff damages is very difficult and requires disentangling weather, general economic factors from tariff impacts. Also payment rates should depend on size of lost exports to China.
3. Now. With all the caveats out of the way, one cannot help but be struck by the MPP payment rate vs. projected 2018/19 prices since May. Soybeans makes sense given price decline. But sorghum at 43 cents and corn at 1 cent?
4. Yes, sorghum may have had earlier damages due to a head start on the trade impacts but 43/1??? Further, wheat and cotton price projections have increased but have payment rates of 7 cents and 4 cents???
5. My conclusion is that this is just another example of the of regional ag political influence on $ from the federal govt. Mainly the Midwest vs. the South w/ the Great Plains also a factor. You see the same thing in farm bill commodity programs and crop insurance rates
6. I really don't think it is that complicated. Bulk of total payments going to soybeans = Midwest. Gotta spread the rest around geographically. Not saying this is the whole story but it had to factor into the final rates.
7. Gives me a chance to once again appreciate having such great mentors in grad school at Purdue who taught me to never forget that ag politics is primarily geographic rather than by party.
8. Finally, if you have not read the #FDD articles on trade this week don't miss them. farmdocdaily.illinois.edu/2018/08/market… and farmdocdaily.illinois.edu/2018/08/dispat…
