Recent news articles demonstrate that tariffs on U.S. agricultural commodities are having an impact not only on the quantity of U.S. goods exported to China, but also the flow of some agricultural products within the U.S., and 2019 acreage allocation decisions by farmers. Meanwhile, a recent Wall Street Journal article reported that, “President Trump said the U.S. is getting much closer to a trade deal with China, a sign of optimism ahead of the Group of 20 leaders summit in Argentina later this month.”
Farm Policy News
USDA Agricultural Projections Show Decreased Soybean Acres
On Friday, the USDA’s Office of the Chief Economist (OCE) released selected tables prepared for the Department’s upcoming Agricultural Baseline Projections report. In part, the tables demonstrated that, “USDA estimated 82.5 million acres of soybean plantings for the spring of 2019, down from 89.1 million acres this year.”
Additional U.S. Trade Tariffs Possible as Ag Markets Absorb Impacts
Trade tensions between the U.S. and China persist, while Chinese tariffs on U.S. commodities continue to roil markets. Despite a variety of impeding economic variables, a news article notes that the current ag economy is sturdier than when the 1980s farm crisis unfolded. Meanwhile, export competitors move forward with a Trans Pacific Partnership agreement, while the benefits of the new USMCA may be overshadowed by ongoing tariff disputes.
ERS Report- “An Exploration of Crop Markets: A Deeper Look Into the USDA Crop Baseline Projections.”
On Monday, the USDA’s Economic Research Service (ERS) released a report titled, “An Exploration of Crop Markets: A Deeper Look Into the USDA Crop Baseline Projections,” which discussed the February 2018 USDA long-term crop projections in greater detail. Today’s update highlights aspects of the report relating specifically to corn and soybeans.
Tariff Disruptions Persist, While Trade Talks with China Seem Uncertain
Recent news items continue to discuss the impacts of trade tariffs on agricultural commodities, including soybeans, dairy products, and pork. Meanwhile, separate articles have focused on executive branch trade policy perspective with respect to China, as well as as the administration’s view on potential trade mitigation payments for 2019.
Federal Reserve: Observations on the Ag Economy- October 2018
On Wednesday, the Federal Reserve Board released its October 2018 Beige Book update, a summary of commentary on current economic conditions by Federal Reserve District. The report included several observations pertaining to the U.S. agricultural economy.
Kansas City Fed Update: Ag Lending, Farmland Values, and Farm Income
Nathan Kauffman and Ty Kreitman indicated in a recent update from the Federal Reserve Bank of Kansas City (“Large-Scale Financing Drives Ag Lending Activity Higher”) that, “Alongside persistently low agricultural commodity prices, bankers throughout the country expected farm income to decline in the coming months. Despite the ongoing weaknesses in farm income and agricultural credit conditions, however, delinquency rates on farm loans remained low and the performance of agricultural banks remained sound.”
Trade War May Be More Than “a Short-Term Hiccup” for Agriculture
Recent news articles continue to highlight the impact that the ongoing trade war between the U.S. and China is having on the agricultural economy. Today’s update looks at news items that discuss trade repercussions for pork and soybean farmers.
After Updated KORUS and USMCA, U.S. Trade Agenda Continues
After recently signing a new KORUS (United States-Republic of Korea) Trade Agreement, and reaching an agreement on a revised North American Free Trade Agreement with Canada and Mexico, the U.S. Trade Representative’s Office signaled this week that the U.S. will start trade talks with Japan, the EU and the U.K. soon.
Expiration of the 2014 Farm Bill, CRS Report
A report last week from the Congressional Research Service stated that, “The timing and consequences of expiration vary by program across the breadth of the farm bill. There are two principal expiration dates: September 30 and December 31. The 2014 farm bill generally expires either at the end of FY2018 (September 30, 2018), or with the 2018 crop year. Crop years vary by commodity, but the first to be affected by a new crop year is dairy, whose 2018 crop year ends on December 31, 2018.”
U.S. and China Plan Talks in November, While Soybean Trade Flows Adjust
News reports indicate that President Trump and Chinese Leader Xi Jinping plan to meet in November, in what could be an opportunity for the two leaders to discuss trade issues. Meanwhile, a recent USDA report, and current news articles, continue to highlight how the ongoing Chinese trade tariffs are impacting the international trade flow of soybeans.
President Trump Opens Door to Increased Ethanol Use
On Tuesday, Bloomberg writers Jennifer A Dlouhy and Mario Parker reported that, “President Donald Trump is moving to clamp down on a scandal-plagued $2.25 billion market in biofuel compliance credits, embracing reforms that could block Wall Street banks from trading them…[and]…at the same time, Trump will order the EPA to take steps to enable the year-round sale of gasoline containing as much as 15 percent ethanol.”
Farm Bill Negotiations: Tensions Persist
The current Farm Bill has expired and tensions among key members of the Conference Committee persist. Today’s update provides an overview of recent articles that highlight ongoing Farm Bill issues in greater detail.
Reports Discuss Soybean Export Variables
Today’s update looks briefly at recent reports that discuss variables associated with U.S. soybean exports. In addition, news items that highlight concerns about crop storage issues, and the trade policy outlook, are also noted.
Steady Farmland Values Help Insulate a Struggling Agricultural Sector
Suzanne Jenkins, a senior policy analyst at the Federal Reserve Bank of St. Louis, and Nathan Kauffman, vice president at the Federal Reserve Bank of Kansas City, indicated in a recent update (“A Tale of Two Economies: Farmers Struggle despite Strong U.S. Economy”) at the Regional Economist that, “At a time when the overall U.S. economy continues to boom, the U.S. agricultural sector has continued to struggle amid falling farm income and deteriorating agricultural credit conditions.”
New NAFTA: USMCA (U.S.-Mexico-Canada Agreement)
Wall Street Journal writers Jacob M. Schlesinger, Kim Mackrael and Vivian Salama reported Monday that, “The U.S. and Canada reached a dramatic, last-minute deal late Sunday night on revising the North American Free Trade Agreement, lifting a cloud of uncertainty over the quarter-century-old continental commercial bloc.”
USDA’s Trade Aid Package
Recent news articles have discussed USDA’s trade aid package, as well as the potential impacts of ongoing trade tariffs on U.S. farm goods. Today’s update provides an overview of several of these articles.
ERS Report: Tillage Intensity and Conservation Cropping in the U.S.
On Wednesday, the USDA’s Economic Research Service (ERS) released a report titled, “Tillage Intensity and Conservation Cropping in the United States,” which discussed regional and crop conservation tillage practices, as well as adoption of residue and cover practices. Today’s update highlights a few aspects of the report.
Tariff Impacts on Soybean Trade
Business news articles continue to highlight how Chinese soybean tariffs are impacting the international sale and purchase of soybeans. Today’s update looks briefly at a few of these recent news items.
Farm Bill Perspective From Ranking Member Peterson
House Ag Committee Ranking Member Collin Peterson (D., Minn.) was a guest on Friday’s “Adams on Agriculture” radio show with Mike Adams. Today’s update includes perspective on the status of the Farm Bill legislation from Rep. Peterson, as well as other recent news items discussing the Conference Committee’s progress.