Chinese Tariffs Take Toll on Soybean Markets

As the impacts of the ongoing U.S.-China trade dispute continue to unfold, a report last week from the U.S. Department of Agriculture provided some insight into how the Chinese tariffs are affecting soybean markets.  Today's update looks at news reports that discuss trade issues and the USDA report in greater detail.
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Recent FAO and USDA Updates Provide Additional Perspective on U.S. Agricultural Trade

The Food and Agriculture Organization of the United Nations (FAO) recently published its biannual Food Outlook report that provides short-term forecasts for commodity production, trade and prices.  Also this week, the U.S. Department of Agriculture updated its monthly trade database which provided more insight into agricultural trade prospects for this fiscal year.  Meanwhile, recent news articles continue to focus on U.S. soybeans and the potential impacts of Chinese tariffs on exports.  Today's update looks briefly at each of these three items.
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Trade War Begins, as U.S. Soybean Exports Surged in the Second Quarter

Don Lee reported on the front page of Saturday's Los Angeles Times that, "The tariffs that the United States and China slapped on each other’s exports Friday intensified a trade battle that has a strong risk of roiling financial markets, chilling consumer confidence and seriously harming the global economy...Soybeans topped the list of newly taxed items— and they illustrate how deeply U.S. and Chinese producers and consumers have come to depend on each other."
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Looming U.S.- China Trade Battle: Soybean Trade Flows and Substitutes

Bloomberg writer Andrew Mayeda reported Thursday that, "President Donald Trump is preparing to slap tariffs on Chinese goods early Friday, the first shot in a trade war between the world’s two biggest economies. Tariffs on $34 billion of Chinese goods are scheduled to take effect at 12:01 a.m. in Washington, the U.S. Trade Representative confirmed in an email Thursday. The milestone marks a new and damaging phase in a conflict that has roiled markets and cast a shadow over the global growth outlook."
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Producers Express Concern in the Midst of Price Turmoil, While ERS Looks at Farm Sector Financial Health

Financial Times writer Gregory Meyer reported on Monday that, "US soyabean futures have tumbled to the lowest price in nine years as the market succumbs to healthy growing conditions and fears over imminent tariffs from China."  Amid this climate, Secretary of Agriculture Sonny Perdue visited with producers in the northwest earlier this week and heard first hand concerns about trade and the current financial environment.  With this background in mind, the USDA's Economic Research Service (ERS) released a timely update on Monday that painted an interesting "snapshot" of the U.S. ag economy titled, "Current Indicators of Farm Sector Financial Health."
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Ag Economy: Land Values and Farm Income Considerations

Today's update looks briefly at recent reports from the Federal Reserve Bank of Dallas and the University of Nebraska at Lincoln that shed light on trends in farmland values.  Also, a recent survey from Iowa State University that provides statistical insights into farmland owners, is examined.  Lastly, news articles that continue to look at the deteriorating prices of some agricultural commodities, and their resulting potential negative impacts on farm financial well-being, are also discussed.
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Corn, Soybean Prices Flounder; Sec. Perdue Reiterates Promise to Stand with Farmers

News articles over the past several days have highlighted heightened U.S. trade policy risks and recent declines in the price of corn and soybeans.  Farm state Senators expressed their concern regarding executive branch trade policy, and its impact on the U.S. agricultural sector, to Commerce Secretary Wilbur Ross at a recent Finance Committee hearing.  Meanwhile, Secretary of Agriculture Sonny Perdue indicated in a recent opinion column that, "The U.S. has to stand up to China's abusive trade practices like intellectual property theft.  And we won't leave farmers to face Chinese bullying alone."
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U.S.-China Trade Row Persists- Administration Says it Will “Be There For the American Farmers”

In conjunction with positive early season crop condition ratings, an ongoing and escalating trade dispute between the U.S. and China put negative pressure on corn and soybean prices Tuesday.  Meanwhile, The Wall Street Journal indicated that the administration is 'working on measures that will have the backs of farmers,' as the trade dispute unfolds.  Separately, farm state lawmakers stressed the importance of global markets for agricultural producers, who have already been struggling with lean farm income.
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Quick Take: Recent USDA Trade Data

Over the past several days, the U.S. Department of Agriculture has released a handful of updates relating to U.S. agricultural trade.  The recent information includes updated projections for fiscal year 2018 agricultural exports, as well as the latest monthly trade data.  As trade policy uncertainty persists, today's post provides a brief overview of the recent trade information.
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