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Commodity Marketing in the Ad Hoc Era

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  • Robertson, Dewey J.
  • Hendricks, Nathan P.

Abstract

Ad hoc programs are increasingly becoming the administrative means by which farm support is provided. This paper examines how ad hoc programs distort commodity market outcomes through the storage margin. Using a commodity-state-quarter-marketing-year panel dataset covering corn, soybeans, and wheat from 2016—2024, we employ a two-stage least squares estimator that exploits cross-state variation in ad hoc payment levels as an instrument for on and off-farm inventory shares. The first stage indicates that payments increase inventory shares early in the marketing-year when liquidity constraints are tightest following harvest. We further find evidence of anticipatory storage behavior, suggesting that producers expect ad hoc payments. Second stage estimates indicate that payment-induced stockholding affects local cash prices as detected in the basis. Our results have implications for how the impacts of ad hoc agricultural support programs are evaluated and for the design of risk management tools in markets subject to policy-driven storage incentives.

Suggested Citation

  • Robertson, Dewey J. & Hendricks, Nathan P., 2026. "Commodity Marketing in the Ad Hoc Era," 2026 Annual Meeting, July 26 - 28, 2026, Kansas City, Missouri 404767, Agricultural and Applied Economics Association.
    • Handle: RePEc:ags:aaea26:404767
    DOI: 10.22004/ag.econ.404767
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