New US Tariffs on Chinese Goods Expected
Jun 15, 2018
Good Morning! From Allendale, Inc. with the early morning commentary for June 15, 2018.
Grain markets unease continues ahead of today's expected release of US tariffs on Chinese products. Strength in the US Dollar as well as good growing conditions in the US is adding to the weakness.
Allendale's Rich Nelson took a look at corn ratings, weather and potential 2018 yields in quick 8 minute webinar yesterday. If you're interested, it's available here, and worth your time.
Beijing's threat to impose a 25 percent tariff on American soybeans is causing uneasiness in the farm belt ahead of the White House's expected decision Friday to announce new duties on hundreds of Chinese products. President Donald Trump met with trade advisors on Thursday, and the administration is expected to roll out a truncated list of Chinese products subject to duties. (CNBC)
NOPA Crush will be released this morning at 11:00 AM CDT. The 165.1 million bushel estimate for May soybean crushing would be 10.6% over last year if realized. Year to date production would therefore run 6.2% over last year.
Weekly export sales for the week ending June 7th had corn sales totaling 1,176,591 metric tonnes (936,440 for 2017/18). This was within the 800,000 – 1,300,000 trade expectation. 96% of USDA’s newly revised WASDE estimate for corn exports has now been met. That is under the 98% five year average.
Soybean sales totaled 810,547 metric tonnes (519,557 for 2017/18 and 290,990 for 2018/19), over the 200,000 – 800,000 trade expectation. The old crop sale was the second best sale for this particular week in history. Sales are now where they should be at 100% of USDA's marketing year estimate.
The new wheat marketing year started on June 1. Yesterday’s sales covered the first full week of the new marketing year. Wheat export sales came to 302,349 tonnes (all 2018/19). That was within the 150,000 – 450,000 trade expectation.
The number of ships waiting to berth at Brazilian ports to load soybeans and its byproducts is currently almost 60 percent larger than in the same period last year, according to data from shipping agency Williams compiled by Reuters. At the same time, the amount of ships that are berthed and currently loading is 42 percent smaller than seen at this time last year. (Reuters)
Mexico is considering new tariffs on the four billion dollars in annual imports of U.S. corn and soybeans if the Trump Administration escalates trade issues in NAFTA. Mexico has already added tariffs to US steel, apples and pork after the US imposed metals tariffs.
Managed money funds were mostly sellers across the board yesterday, selling an estimated 30,000 corn contracts, 7,000 soybeans, 6,000 wheat, and 3,000 soymeal. They were buyers of 2,000 soyoil.
Beef export sales were reported at 22,242 tonnes for last week. That was more than double the 8,509 posted last year at this time. Our year to date sales of 515,058 tonnes are 22% over last year. This is now the sixth week in a row of good sales.
Pork export sales recovered a little from last week’s disappointing number. The 14,678 tonnes sold were 19% over last year. Year to date sales are still a little low at 3.3% over last year.
Both Farmer John and Tyson's Columbus Junction plant are planning no shifts for pork production next week due to the tightness in hog supplies. We expect the year's smallest kill in the last week of this month.
Dressed beef values were lower with choice down 1.82 and select down .33. The CME Feeder Index is 140.70. Pork cutout value is up .71.