Economic Tidbits

Be Careful with Comparisons

Data on agriculture or the economy will often make comparisons to the prior year to provide context or discern trends. At times, though, such comparisons are meaningless or useless. Last year at this time, the world was in the throes of the COVID-19 outbreak. In agriculture, the outbreak created havoc in grain and livestock markets, slaughter rates, ethanol production, and more.

So, when data is reported over the next few months with comparisons to last year, there will be unusual year-to-year changes reported. For example, the USDA Agricultural Marketing Service auction receipts for the week ending April 16 showed receipts this year were 744 percent greater compared to last year. It’s a good bet the increase was not due to a flood of animals auctioned this year, but because last year’s receipts were exceedingly low due to COVID. So, when numbers are reported this year, just remember what was happening last year.

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