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3 Big Things Today, August 7
1. Soybeans, Corn Slightly Higher Overnight, Wheat Falls
Soybeans and corn were slightly higher while wheat was lower in overnight trading as investors keep an eye on hot weather in parts of the Plains and the ongoing trade war between the U.S. and China.
Extremely hot weather with indexes around 110˚F. are expected in parts of Kansas and Oklahoma today, while in eastern Kansas severe thunderstorms are in the forecast.
The ongoing trade war between the U.S. and China has no end in sight as the U.S. called China a currency manipulator for the first time since 1994, and Beijing said it would halt all purchases of U.S. agricultural products.
Investors also are anticipating the USDA’s World Agricultural Supply and Demand Report, which is due out on August 12.
Soybean futures for November delivery rose 2¢ to $8.67¾ a bushel overnight on the Chicago Board of Trade. Soy meal was unchanged at $302.60 a short ton, while soybean oil gained 0.14¢ to 28.05¢ a pound.
Corn futures for December delivery added 1¢ to $4.13½ a bushel overnight.
Wheat for September delivery fell 2¢ to $4.82 a bushel, while Kansas City futures dropped 1¾¢ to $4.16¼ a bushel.
2. Trade War Hits Lowest Point, Trump Says He’ll Continue to Raise Tariffs
The latest from the ongoing trade row between the U.S. and China isn’t good news as most had expected a deal to be in place by now.
Presidents Donald Trump and Xi Jinping have met a couple of times, both indicating they were interested in coming to an agreement that would end the more-than-year-long trade war between the countries, but here we are, with no deal in sight.
Instead, the sides seem further apart than ever.
Trump over the weekend tweeted that the U.S. would impose 10% tariffs on $300 billion worth of Chinese goods that weren’t already subject to levies. In return, Beijing allowed its currency, the yuan, to fall below the historical seven-per-dollar mark this week.
That, in turn, led the U.S. to declare China as a currency manipulator, a designation that accuses the Asian nation of intentionally devaluing its currency to give it “an unfair competitive advantage in international trade,” according to the U.S. Treasury.
That’s the first time in 25 years the designation has been put on China.
Naturally, the Chinese central bank denied the charge and says by imposing the designation, the U.S. is risking further market turmoil.
China also said this week it would shut off all purchases of U.S. agricultural products, what American Farm Bureau Federal President Zippy Duvall called a “body blow” to the farm sector, according to The Wall Street Journal.
The value of farm-goods shipments to China was halved year over year, falling from $19.5 billion in 2017 to $9.1 billion last year, the Journal reported.
Trump thus far has been unphased by China’s actions, saying yesterday that he will continue to impose tariffs in a bid to get Beijing to make a deal.
“As they have learned in the last two years, our great American Farmers know that China will not be able to hurt them in that their President has stood with them and done what no other president would do,” he said in on Twitter. “And I’ll do it again next year if necessary!”
3. Heat Wave Expected in Parts of Kansas, Oklahoma, Texas, Gulf Coast Wednesday
Another heat wave is rolling through the Southern Plains into Texas and the Gulf Coast, as heat advisories have been issued in several states, according to the National Weather Service.
In the western half of Kansas, heat index values of about 110˚F. are expected today as actual temperatures hover around 100˚F. with high humidity, the NWS said in a report earlier this morning.
Similar temperatures are forecast in much of Oklahoma, Texas, Arkansas, and Louisiana and east into Mississippi and Alabama.
“Extreme caution is advised for those working outdoors,” the agency said.
Strong storms, meanwhile, are rolling across the eastern half of Kansas as some areas will see wind gusts from 30 to 50 mph. Very heavy rainfall also is likely in the area, the NWS said.
Severe thunderstorm and flood warnings are in effect in the eastern half of the state along with flash flood watches, the agency said.