News

Trade War-Market Disruptions Persist


As policy observers anticipate a meeting later this month between President Trump and China’s President Xi Jinping at the Group of 20 summit in Buenos Aires, recent news items continue to highlight the adverse impacts ongoing trade disputes are having on some sectors of the U.S. agricultural economy.  The trade war is also providing economic incentives for robust Chinese investment in its domestic agricultural production.

Tariff Impacts Continue

Reuters writers Mark Weinraub and P.J. Huffstutter reported last week that, “U.S. farmers finishing their harvests are facing a big problem – where to put the mountain of grain they cannot sell to Chinese buyers.”

The article explained that,

Across the United States, grain farmers are plowing under crops, leaving them to rot or piling them on the ground, in hopes of better prices next year, according to interviews with more than two dozen farmers, academic researchers and farm lenders. It’s one of the results, they say, of a U.S. trade war with China that has sharply hurt export demand and swamped storage facilities with excess grain.

Weinraub and Huffstutter indicated that, “Farmers are feeling the pinch. Those in central Illinois could pay up to 40 percent more than in previous years to store crops over the coming weeks, agricultural consultant Matt Bennett estimated.

“That amounts to between 3 cents to 6 cents a bushel, Bennett said, a painful expense for a crop that was already expected to deliver little income to farmers.”

The Reuters article added, “Even before this fall’s harvest, around 20 percent of total grain storage available in the U.S. was full with corn, soybeans and wheat from previous harvests, according to the U.S. Department of Agriculture. That was the highest in 12 years for this time of year.”

View image on Twitter

International Grains Council @IGCgrains

With ample supplies available for processing due to a sharp fall in exports, 2018/19 domestic #soybean use in the US could reach a record 60.1m t and exceed exports by 9.0m, the most in six seasons.

See International Grains Council’s other Tweets

Gavin Maguire @RtrsAgAnalyst

China soy imports from Brazil double in Oct y/y amid Sino-U.S trade tensions https://www.agriculture.com/markets/newswire/update-1-china-soy-imports-from-brazil-double-in-oct-yy-amid-sino-us-trade-tensions 

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