News of additional Chinese tariffs on imports from the U.S. undermined corn soybean futures on Friday.
China today announced a 5% increase to the tariffs on U.S. soybeans, taking them to 30% starting on Sept. 1. As well, China said extra 10% duties on U.S. wheat, corn and sorghum will take effect from Dec. 15. The latest Chinese tariff announcement follows U.S. duties on $300 billion worth of Chinese goods.
The higher Chinese soy tariffs are expected to be largely symbolic, as private Chinese companies have essentially already stopped all purchases of most American commodities. (State buyers who are exempt from the tariffs are still making some purchases). Regardless, the move further escalates the U.S.-China trade war that has been ongoing for over a year now and has resulted in a sharp drop in American agricultural exports, particularly soybeans.
China said it will also levy extra 10% tariffs on U.S. beef and pork from Sept. 1.
September soybeans fell 12 ¾ cents to $8.43 ¼ and November was down 12 ¼ cents at $8.56 ½, even as results from this week’s Midwest crop tour found more evidence of lower yield potential.
The declines in corn were more modest with September down 3 ½ cents to $3.59 ¾ and December off 3 ¼ cents to $3.67 ¾. With the market near a three-month low, some support for corn came from weak crop tour results and forecasts calling for cooler-than-normal temperatures in the Midwest next week, which may further slow lagging crop development.
Wheat futures ended mainly higher on the day. September Chicago wheat climbed 8 cents to $4.75 ¼, September Kansas City was down 1 ¾ cents to $3.91 ½ and September Minneapolis managed a ¼-cent gain to $4.98 ¾.
Live cattle and lean hog futures were both sharply lower on the day.
Source: DePutter Publishing Ltd.
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