March 10
3/10 - China’s retaliatory tariffs are set to take effect today. On the agricultural side, they include 15% on U.S. corn and wheat; 10% on soybeans. During the 2018/2019 trade war with China, U.S. agricultural exports plummeted, with losses estimated at $25B. Additionally, the U.S. lost considerable Chinese market share to Brazil, much of which has not been recovered. Domestically, initial pre-planting forecasts are for good growing conditions and large U.S. crop production this season. Crop prospects for South America have also improved. As a result, U.S. grain prices have been falling since mid-February. Over the past 3 weeks, CME corn futures have dropped from $5.02 to $4.55 per bushel; wheat from $6.27 to $5.51; and soy-oil from $.4730 per pound to $.4287. Look for additional information this week in the USDA’s monthly WASDE report on Tuesday (3/11) and Market Vision’s Commodity Update on Wednesday (3/12).