3 Big Things Today, January 15, 2020

Soybeans, Corn Little Changed Overnight; U.S.-China Trade Deal to Be Signed Wednesday.

1. Soybeans, Corn Little Changed Overnight, Wheat Again Higher

Soybeans and corn were little changed in overnight trading as investors anxiously await details of the trade deal between the U.S. and China.

The signing ceremony is expected to occur at 11:30 a.m. in Washington, which will be followed by the release of details about the partial trade agreement between the countries.

Soybean futures for March delivery fell ½¢ to $9.41¾ a bushel overnight on the Chicago Board of Trade. Soy meal futures added 70¢ to $302.70 a short ton, and soy oil declined 0.22¢ to 33.85¢ a pound.

Corn futures for March delivery were unchanged at $3.89 a bushel.

Wheat futures, however, were again higher overnight after Egypt purchased 240,000 metric tons of wheat from international supplies. The Egyptians reportedly bought Russian and Romanian wheat.

Prices also rose overnight on reports that Russia is considering keeping a lid on exports of the grain until June. S&P Global Platts reported that Russia’s Agriculture Ministry has released a draft order that would limit grain exports to 20 million metric tons from January to June in a bid to safeguard domestic prices.

The report, however, said analysts don’t expect the order to affect exports.

Wheat futures for March delivery rose 4½¢ to $5.73 a bushel overnight in Chicago, while Kansas City futures added 3¢ to $5 a bushel.

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2. Eighteen Months in the Making, Phase One Trade Deal With China to Be Signed Today

The day has finally arrived when the U.S. and China will sign the long-awaited trade deal between the two countries that has been 18 months in the making.

U.S. President Donald Trump and Chinese Vice Premier Liu He – the chief negotiator who helped broker the deal – are scheduled to sign the Phase One agreement in Washington today.

The terms of the agreement haven’t yet been released, but snippets have come out in the past month since the deal was reached.

The deal will at least partially end the trade war between the countries that’s raged for 18 months, curbing hundreds of billions of dollars in exports from both nations.

Essentially, China will increase purchases of agricultural products and make concessions with regard to intellectual property, though exact amounts won’t be known until details are released. China has been reluctant to publicly announce how much it would buy from the U.S.

In return, the U.S. will curb some tariffs and won’t impose new ones as long as the Asian nation adheres to agreed-upon levels under the deal. A Bloomberg report on Tuesday said the Trump administration will leave existing tariffs in place until after the presidential election in November.

The report said the U.S. would review the progress China has made in terms of the Phase One deal in about 10 months, after which it could curb tariffs on $360 billion worth of Chinese goods.

Treasury Secretary Steven Mnuchin, however, reportedly told reporters that the import tariffs on Chinese goods would remain in place until the president signs a Phase Two agreement.

So far there’s no time line for the sides to put together that deal, though negotiators from both sides have said they’ll begin work on the second part of the overall agreement as soon as the Phase One deal is signed.

Trump and Liu are scheduled to sign the deal at 11:30 a.m. at the White House, according to the office of the press secretary, after which details of the Phase One agreement will be released.

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3. Winter Weather Advisories Issued For Iowa, Northern Illinois, Central Minnesota

Weather maps are active this morning with winter weather advisories, dense fog warnings, and precipitation likely in several states.

Winter weather advisories are in effect in most of Iowa and parts of northern Illinois and southern Wisconsin, according to the National Weather Service. A separate advisory is in effect for a narrow band stretching from southern North Dakota east into northern Wisconsin.

In Iowa, freezing drizzle has made for slick roads this morning, the NWS said in a report early this morning.

Snow is expected to continue in parts of central Minnesota, which likely will be accompanied by freezing drizzle along the Interstate 90 corridor, the agency said in its report. Travel likely will be dangerous in the area due to ice accumulations.

In parts of southern Oklahoma, eastern Texas, and Arkansas, dense fog is an issue this morning. In Arkansas, visibility has been reduced to less than ¼ mile in several counties. A dense fog warning has been issued for much of the state until 9 a.m. local time.

Farther west along the Colorado-Kansas border, “wintry precipitation” is expected starting tomorrow and lasting through Friday, the NWS said. Wind gusts up to 45 mph are possible.

“Precipitation amounts are expected to be low, however, a combination of light snow, sleet, freezing rain, and rain will be possible, which could result in difficult travel conditions,” the agency said.

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