Tag Archives: Trade

Light selling in the wheat…how did that effect the corn trade?  Oil & ethanol concerns.  How soon will we be back to normal? Planting intentions report due out at months end.  Could we see increase in unplanted acres?  Corn/bean ratio and what are we seeing in the basis?  Cattle market on expanded limits, one needs the other.  Is Tyson’s announcement effecting the markets?

 

It was a good market day with positive Ag markets.  Stock market wasn’t the best, Dow down.  Double digit increases in soybeans & Chicago/KC wheat.  Sue looks at the money leaving the stock market on rallies.  Money will find safety.  Ag could see a good return on their investment.  Packers are offering certain bids…but a bill in the house will focus on bottom prices for cattle to be purchased.  Will we see decreased numbers in next cold storage report?  Thoughts on the planting intentions report while looking at some new grain movement issues out of South America.

 

 

FINALLY, some green to the screen for beans.  Corn continues lower.  Wheat was somewhat higher. Demand destruction for gas & ethanol & what that means for the corn industry.  Historic charts for corn & beans will the reports later this month make changes to that?  South American harvest, is there a decrease in the numbers?  Meat movement, long term outlook for cattle…there is a light at the end of the tunnel.

 

The outlook for the United States farm economy depends on the implementation of new trade agreements and the evolution of animal and human disease outbreaks.

The University of Missouri Food and Agricultural Policy Research Institute reports that while net farm income increases in 2020, under a baseline assumption of continued trade friction with China, other indicators of the health of the farm economy are not as positive. Projections show that with an assumed return to normal planting and growing weather in 2020, there will be an increase in projected area, yields and supplies and lower prices for corn and soybeans in the 2020/21 marketing year.

With trend yields, 2020 corn production increases to 15 billion bushels, putting downward pressure on prices, which are projected to average $3.57 per bushel. With soybeans, an increase in production drops prices to $8.48 per bushel, before considering the possible impacts of the “Phase 1” trade agreement. Additionally, potential African swine fever impacts, along with the impact of COVID-19, could change the farm economy in 2020, as well.

Livestock limit down as it was on expanded limit.  Not a lot of proteins moving with cancellations because of Coronavirus.  How does the cattle & pork producer try to focus & find the positive?  Basis continues for the corn steady.  Feed demand will have added pressure to the grains-almost a domino effect.  How will the slow down and fuel issues effect the ethanol plants.  March planting intentions report outlook.

WASHINGTON – U.S. Sen. Jerry Moran (R-Kan.) – Chairman of the Senate Appropriations Subcommittee on Commerce, Justice, and Science and member of the Appropriations Subcommittee on Agriculture – sent a letter with 20 other senators to U.S. Trade Representative Robert Lighthizer, urging the administration to reach a U.S.-UK trade agreement that addresses the UK’s unfair barriers to U.S. food producers.

“Trade positions held by the EU that are based on antiquated and unscientific food standards should be rejected in an agreement with the UK, including those standards that block significant segments of U.S. beef, pork, dairy and poultry exports and discourage the use of biotechnology,” the senators wrote. “…Basing food standards on sound science and addressing tariff and non-tariff barriers will ensure a level playing field for U.S. farmers, ranchers and food manufacturers, while also resulting in greater access to safe and affordable food for UK consumers.”

Sens. Pat Roberts (R-Kan.), Mike Enzi (R-Wyo.), John Cornyn (R-Texas), Richard Burr (R-N.C.), John Barrasso (R-Wyo.), John Boozman (R-Ark.), John Hoeven (R-N.D.), Deb Fischer (R-Neb.), Tom Cotton (R-Ark.), Steve Daines (R-Mont.), Mike Rounds (R-S.D.), Thom Tillis (R-N.C.), Joni Ernst (R-Iowa), Ben Sasse (R-Neb.), Todd Young (R-Ind.), Doug Jones (D-Ala.), Cindy Hyde-Smith (R-Miss.), Mike Bruan (R-Ind.), Josh Hawley (R-Miss.), and Kelly Loeffler (R-Ga.) joined the letter to Ambassador Lighthizer.

The full letter is below, or click here for the signed letter. 

Ambassador Robert Lighthizer

Office of the United States Trade Representative

600 17th Street NW

Washington, DC 20508

Dear Ambassador Lighthizer,

We support the administration’s effort to negotiate a trade agreement with the United Kingdom (UK). Increasing economic commerce between our nations by reducing trade barriers, increasing investments and modernizing our trading relationship will benefit American producers and consumers.

U.S. food and agricultural producers face unfair barriers to market access in the UK largely as a result of the UK’s former membership in the European Union (EU). The UK’s decision to leave the EU offers a unique opportunity to address these trade barriers in a bilateral U.S.-UK trade agreement. In negotiations with the UK, we urge you to uphold and promote U.S. science-based food standards and work to address tariff and non-tariff barriers for U.S. agriculture.

American farmers and ranchers are committed to producing safe, nutritious, high quality food products. Our nation’s food standards and regulations are among the highest in the world as a result of being developed on the principles of sound science, data and facts. The modern food production system in the United States has led to a safe and sustainable food supply depended upon by consumers around the world.

The science-based standards met by food producers, processors and manufacturers in our country ought to be reflected in each trade agreement negotiated by the U.S., including with the UK. Trade positions held by the EU that are based on antiquated and unscientific food standards should be rejected in an agreement with the UK, including those standards that block significant segments of U.S. beef, pork, dairy and poultry exports and discourage the use of biotechnology. Commonsense reforms to geographical indications policies and safeguards regarding the use of common food names should also be included in an agreement.

We are pleased the UK’s negotiating objectives include improving trade on agricultural products as both nations stand to benefit from a trade agreement that recognizes modern food production methods. Basing food standards on sound science and addressing tariff and non-tariff barriers will ensure a level playing field for U.S. farmers, ranchers and food manufacturers, while also resulting in greater access to safe and affordable food for UK consumers.

Thank you for your continued efforts to reach a U.S.-UK trade agreement that addresses trade barriers for U.S. agriculture.

European Union Trade Commissioner Phil Hogan canceled plans to travel to the U.S. and Canada next week due to the coronavirus. An EU spokesperson told Politico, “The trip has been canceled and will be rescheduled as soon as possible,” adding, “If necessary, contacts will continue through other means.”

Hogan was scheduled to visit the United States while the U.S. and EU are working on a mini trade deal, one that U.S. agriculture interests hope will successfully include agriculture provisions.

However, his visit next week was for a U.S. Chamber of Commerce event. Hogan also canceled his planned trip next week to Canada to discuss World Trade Organization reforms. Both events are postponed or canceled. Earlier this week, President Donald Trump announced U.S./EU travel restrictions for 30 days, requiring foreign nationals to test for COVID-19 before flying. Last week, Hogan reported the U.S. and the EU were “taking slow, small steps” toward a mini trade deal.

The Department of Agriculture Tuesday said there’s progress in the implementation of the U.S.-China Phase One Economic and Trade Agreement. Agriculture Secretary Sonny Perdue says China has taken several additional actions to reach its agriculture-related commitments.

The actions include the signing of a protocol that allows the importation of fresh California nectarines, and the lifting of a ban on imports of U.S. beef and beef products from animals over 30 months of age. Additionally, China has updated its lists of facilities approved for exporting dairy, infant formula, seafood, and fish oil and fish meal.

Also, China’s new tariff exclusion process went into effect on March 2 and importers can now apply for exclusions from retaliatory tariffs. Perdue says USDA will continue to closely monitor China’s implementation of the agreement that was signed February 14, 2020. Perdue adds, “These implementation measures are promising steps showing that China is taking steps to fulfill their purchase commitments.”

Another down day…grains, livestock & stocks.  A lot of fear factor being built in.  Crude oil continues to fall…explain in relation to corn.  March 10th USDA WASDE Report.  Soft export market continues.  Chicago wheat the only market to see some positive trade numbers.  Feeder cattle lock down & struggle …following the equities as they follow what happens in the Coronavirus news.  Seen some solid demand in the hogs…but there is a lot of supply out there.

Vietnam is committing to buy $3 billion in U.S. farm goods to shrink the soaring trade surplus it has with America. Bloomberg says the Asian nation is looking to appease the Trump administration, which isn’t happy about the deficit.

Vietnam is also looking to satisfy the complaints of U.S. companies that face difficulties in accessing Vietnamese markets. A Vietnam Agriculture Ministry spokesman says they “see a lot of room to increase purchases from America, which will significantly help narrow our trade gap with the U.S.,” while also noting that the demand in Vietnam for American farm products is “very high.”

Vietnamese companies signed a total of 18 agreements with American producers to buy about $3 billion in farm products over the next two or three years. The deal includes purchasing 100,000 cows, three million tons of wheat and barley worth about $800 million, fruit, and corn and soy animal feed.

Vietnam’s exports to the U.S. totaled $61.3 billion in 2019, widening the trade gap to $47 billion, up from $34.8 billion the year before, according to Vietnamese customs data. The U.S. Census Bureau says last year’s trade deficit with Vietnam was $55.8 billion, up from $39.5 billion the year before.