Imports and Exports
The bearish tone of the grain markets, especially corn and bean oil, stems from a lack of progress on tariffs and trade deals as well as speculation regarding the blending mandates for biomass-based diesel.
“China and Brazil are getting together. They’re going to build infrastructure, and they’re going to make SAF and they’re going to build railroads, and it’s not good for us and our future. That’s why we need new markets,” says Iowa farmer Tim Burrack.
The deal decreases U.K.’s ethanol tariff from 19% to 0%, creates an opportunity for cattle ranchers to export millions more and opens a $100 million market with free access for rice farmers, says Brooke Rollins, Secretary of Agriculture.
While 56% of farmers say they believe the ongoing trade disputes with China and other countries will hurt them financially this year, 70% say they believe the U.S. and agriculture specifically will benefit in the long-term.
Vietnam has a 100 million people and a growing middle class looking to add protein to their diet. With limited soybean crushing capacity, the country currently depends on soybean meal imports for their livestock and aquaculture feed needs.
Growers are grappling with a second consecutive year of waning demand and no home for their grapes. The issue is complex with non-tariff trade barriers hitting the wine industry especially hard and a flood of imports that are creating cheap wine with which U.S. grape growers can’t compete.
Soybeans and cotton are currently taking the brunt of Trump’s still-developing trade policies, and one ag economist thinks its still too early to tell how the situation will impact renewable fuels and land ownership.
“The sourcing from international markets has become mandatory. It’s more likely that things will get expensive than change,” says Jim DiLisi of Fanwood Chemical.
Major changes weren’t anticipated for USDA’s April World Agricultural Supply and Demand Report, but there were still a few surprises — mostly for corn.
As tariff proposals continue to bring uncertainty, the agricultural sector is assessing how any forthcoming country-by-country trade deals might offset the disruption, or if the industry needs to brace itself for a different kind of future.