The recent rise in domestic crude oil production from 5.4 million barrels per day (b/d) in 2009 to 8.7 million b/d in 2014 and the prospect of continued supply growth have sparked interest in the question of how a change in current policies, which restrict but do not ban exports of crude oil produced in the United States, might affect markets for both crude oil and petroleum products over the next decade.
The United States saw a huge average fall this week for retail gasoline prices, falling 13 cents to $2.41 this week, bringing the 27-day average price to $2.53. The Midwest region saw the largest fall this week of 19 cents to $2.43, while the Rocky Mountain region saw the smallest decrease of only five cents. The Gulf Coast still has the lowest gas prices in the country at $2.19.
Ohio's gas prices fell 30 cents this week to $2.35, while Minnesota dropped 22 cents to $2.42. The lowest gas prices are in Texas at $2.21.
Live cattle and feeder cattle prices both fell on Tuesday. Live cattle decreased $1.87 to $141.33, bringing the 27-day average price to $146.39. Feeder cattle prices also decreased from $201.83 to $200.28. The $1.55 fall brought the 27-day average price to $211.09. Lean hog prices also fell five cents to $67.98, bringing the 27-day average price to $72.66.
Corn prices saw a huge fall of eight cents to $3.56, while wheat increase one cent to $4.84.
U.S. soybeans rose on Wednesday on buying interest after falling 1.5 percent in the previous session but with gains limited by concern about slowing economic growth in China, the world's largest soybean importer.
Retail diesel prices continued to fall this week, seeing an average decrease in the US of five cents to hit $2.51. The 27-week average is now at $2.80.
The New England region saw the largest fall of seven cents to $2.67, bringing the 27-week average price to $3.05. Despite the large fall, the region does not have the lowest diesel prices-- the Gulf Coast currently holds that position at $2.38. The Rocky Mountain region saw the smallest drop of only three cents.
Live cattle prices dropped over the weekend from $146.53 on Friday to $143.20 on Monday, a $3.33 fall that brought the 27-day average price to $146.45. Feeder cattle also dropped 57 cents to $201.83. The 27-day average price now rests at $211.44.
Lean hog prices saw an increase over the weekend from $66.43 on Friday to $68.03 on Monday. The $1.60 increase brought the 27-day average price to $73.02.
Corn prices increased one cent over the weekend, while wheat jumped six cents to hit $4.83.
Soybean meal is an important but an "economically" secondary feed ingredient in hog diets compared to corn. My estimates suggest that soybean meal costs have been about 22 percent of the total costs of raising hogs over the past decade, compared to 32 percent for corn.
The stock market has had a wild couple of weeks. In the six days ending on August 25, the Dow Jones Industrial Average lost 1,878 points (10.7 percent). On Wednesday and Thursday it gained back 988 points (6.3 percent). The turmoil is related to concerns about the Chinese economy.