Commodity Output Events are most appropriate to use when an analyst knows there is a change in Commodity demand or production but does not know which Industries or Institutions will meet that demand. A Commodity is a product or service which may be produced by one or more Industries or Institutions.
|Event Type||Commodity Output Events|
|Event Use||Analyzing change in the sale of a Commodity|
|Event Specification||Commodity 3001-3546 experiencing change in demand/production|
|Event Value||Commodity Output|
EVENT TYPE DETAILS
Commodity Output represents the total value of production of a product or service, regardless of the Industry or Institution that produced it. Remember that an Industry or Institution can make more than one Commodity and a Commodity can be produced by more than one Industry or Institution.
Commodity Output Events are more appropriate than Industry Events when the producing Industry, place of production, and time of production are unknown for the items being purchased. A Commodity Output Event is analyzing the purchase or demand of a Commodity in a given year, but the Commodity itself may have come from a number of producers, been produced in a different Region, and possibly even sold from a previous year’s production (sold from Inventory).
Utilizing a Commodity Output Event will distribute the Output Value across all producing Industries and Institutions after applying Margins and Local Purchase Percentage.
COMMODITY OUTPUT EVENT
An easy example to understand is electricity, Commodity 3039. If there is an increased demand of $1M in electricity, we likely do not know what Industry will be producing it. We can examine who is producing this Commodity in the Region Details, navigating to the Commodity Balance Sheets under Social Accounts and selecting the Industry - Institutional Production table.
If we filter for Commodity 3039 - Electricity, we can see that there are actually thirteen Industries that produced electricity in the United States in 2021. The Market Share in the table below tells us the portion of the locally-produced Commodity supply that is coming from each producer.
Running this activity as a Commodity Output Event will distribute the entire $1M in Output across all 13 producing Industries’ production functions, based on their Market Share of the local supply. Had this same activity been set up as an Industry Event, we would have been forced to assign the entire $1M in Output to one of the electricity producing Industries.
To set up this activity using a Commodity Output Event, first create a unique Title for the Event, then select Commodity Output for the Event Type. Next, click on Specification. Use the dropdown menu to select Commodity 3039 - Electricity. Check out the article Picking an Industry for assistance in choosing the appropriate IMPLAN Commodity. The default Value for this Event Type is Output, so enter $1,000,000.
Click Advanced Fields to enter additional information on Margins and Local Purchase Percentage (LPP) for each Event.
Margins are the value of the retail, wholesale, and transportation services provided in delivering Commodities from producers’ establishments to purchasers. Margins are only applicable for Commodities that are sold for Final Demand either through a wholesaler or retailer, otherwise known as Marginable Commodities. More information on Margins and how to edit them can be found in this article, Editing Margins.
The Local Purchasing Percentages (LPP) indicates to the software what portion of the Event Value affects the local Region and should be applied to the Multipliers. The default LPP setting for Commodity Events is 100% for Non-Marginable Commodities and the Regional Purchase Coefficient (RPC) or Social Accounting Matrix “SAM” value for Marginable Commodities.
For this example, Commodity 3039 - Electricity is a non-marginable Commodity, so we left the default LPP set to 100%. Click Hide Advanced Fields to collapse the Advanced Field.
ANALYZING A COMMODITY EVENT
Now it is time to assign Events to Groups. To assign an Event, click the Drag Event icon, hold it, and drop it into the corresponding Group. The Multi-Select feature allows users to select more than one Event at a time.
Each Group will indicate the number of assigned Events in the upper right corner by showing a number indicating the number of Events in that Group. To double check if an Event was correctly added to a Group, use the drop down arrow to view the assigned Events.
Now click Run in the bottom right of the Impacts Screen.
When the analysis is finished, click View Results. For more information on how to interpret them, check out the article Examining Results & Interpreting Direct, Indirect, and Induced Effects.
Our Results show that the purchase of $1,000,000 of electricity yields a Direct Output for each of the producing Industries in the Region based on their percentage Market Share of the Supply.
COMMODITY DOES NOT EXIST
If a Commodity does not exist within a Region being analyzed, a warning will appear indicating the Event and Group after selecting Run. If a user clicks Continue without making changes, those Events will not generate any results. Learn more about Adding an Industry to your Region.
Written August 30, 2023