Russia and Saudi Arabia Deepen Agricultural Trade Ties
- Saudi Arabia will relax its wheat import standards opening the door to Black Sea imports and strengthening agricultural trade ties with Russia.
- Wheat from the Black Sea did not previously meet Saudi specifications for zero-pest damage.
- Saudi Arabia has long been a reliable export destination for U.S. and European wheat and has been one of the last Middle East markets not dominated by Black Sea wheat.
- What It Means For The U.S. Farmer: At FBN, we believe that this development can be a negative for the U.S. farmers and the U.S. wheat program. Saudi Arabia’s decision to relax their import standards allows Russia to increase their wheat export program with one of America’s biggest political allies in the region. Ultimately this development is another reminder of Russia’s growing dominance in the global wheat trade.
China Purchased U.S. Agriculture Goods Before Tariff Threat
- According to government data, China bought light volumes of U.S. soybeans, wheat, sorghum and pork last week ahead of the latest escalation of trade tensions.
- USDA’s latest export sales data showed that China bought 71,200 tonnes of soybeans, 60,000 tonnes of wheat, 50,000 tonnes of sorghum and 1,350 tonnes of pork for the week ending August 1.
- On Monday, China’s Ministry of Commerce said that the country would be suspending purchases of U.S. agricultural products by Chinese companies.
- With Chinese buying on hold, U.S. exporters will focus on shipping orders made earlier this year during trade negotiations. Some of the outstanding commodities that still need to be shipped includes: more than 4 million tonnes of soybeans and close to 103,500 tonnes of pork.
- What It Means For The US Farmer: At FBN, we believe that the current political climate between the U.S. and China, combined with China’s new policy of suspending purchases of U.S. agricultural goods, is a negative for the U.S. farmer.
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