3 Big Things Today, September 19
1. Soybeans Rise Modestly Overnight on Bargain Hunting
Soybeans were slightly higher in overnight trading as bargain hunters snap up cheap supplies that hit a 10-year low yesterday.
Soybeans fell to the lowest in a decade after the trade war between the U.S. and China escalated with each country imposing new tariffs on the other’s goods.
The Trump administration issued new levies on Monday on $200 billion worth of Chinese wares, and Beijing responded by imposing duties on another $60 billion of U.S. items. The countries already had levies on $50 billion worth of each other’s imports.
Low prices are likely boosting buying by end-users who are trying to nab cheap supplies.
Soybean futures for November delivery rose 3¢ to $8.17 a bushel overnight on the Chicago Board of Trade. Soymeal gained $3.40 to $306.70 a short ton, and soy oil declined 0.18¢ to 27.19¢ a pound.
Corn rose 1¢ to $3.44¼ a bushel overnight.
Wheat futures were also higher on bargain hunting, but the grain has a solid fundamental story as global production is suffering in several areas due to dry weather. The U.S. Department of Agriculture last week lowered its output estimates for several countries including Canada and Australia.
Still, the USDA raised its projection for the Russian crop.
Wheat for December delivery rose 6½¢ to $5.17 a bushel overnight, while Kansas City futures added 8¼¢ to $5.24¼ a bushel.
2. Lawmakers Respond to Escalation of Trade War Between U.S., China
Several lawmakers expressed their thoughts in one way or another about the escalating trade war between the U.S. and China after another round of tariffs were imposed Monday and Tuesday.
President Trump late Monday said in a statement that he ordered the U.S. trade representative to impose new tariffs on $200 billion worth of goods from China in addition to the current duties on $50 billion worth of items from the Asian country.
The new levies will begin on September 24, and will start at 10%, but jump to 25% on January 1, Trump said.
“Further, if China takes retaliatory action against our farmers or other industries, we will immediately pursue phase three, which is tariffs on approximately $267 billion of additional imports,” he said.
China wasn’t swayed by the president’s threat and yesterday retaliated by putting tariffs on another $60 billion worth of U.S. goods in addition to its current levies on $50 billion in items.
Iowa Secretary of Agriculture Mike Naig said Tuesday that the escalation of trade tensions comes at a bad time for farmers.
“As harvest is under way and farmers plan for the 2019 growing season, they need certainty now more than ever,” he said in a statement. “I continue to urge the administration to resolve this trade dispute with China in a way that does not further damage our agricultural economy.”
At the World Economic Forum conference in Tianjin in northeastern China, two U.S. congressmen, both Republicans, held an impromptu press conference on the sidelines to tout the president’s trade policy.
Todd Rokita from Indiana and Darrell Issa from California said in the press conference that they support the president’s trade policies with China because the U.S. has shown “sound evidence” that China is in fact violating intellectual property rights of U.S. companies, according to the South China Morning Post.
“Talk is cheap,” Rokita said. “Actions are what matter. What we are doing is demanding action and demanding that the stealing and cheating stop.”
3. Flash Flood Watches, Flood Warnings in Effect For Parts of Wisconsin, Minnesota, Iowa
Flash flood watches and flood warnings are in effect for parts of southwestern Wisconsin, southeastern Minnesota and northeastern Iowa this morning, according to the National Weather Service.
Several rivers including the Rock River and Fox River are overflowing their banks this morning. The Rock, for example, is at 10.1 feet, topping flood stage of 10 feet.
Scattered thunderstorms are moving through the area this morning and likely will continue into the early afternoon. Heavy rain, gusty winds, and lightning are the main threats.
Another round of storms is expected tonight, with some being strong, the agency said. Damaging wind and quarter-size hail are possible, as is localized flooding, the NWS said in a report early Wednesday morning.
More thunderstorms are possible Thursday through Saturday, and “isolated” tornadoes are possible, according to forecasters.