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Grain markets moving on without the U.S.

Grain markets moving on without the U.S.

Other countries are making up for a lack of U.S. grain

By Diego Flammini
Staff Writer
Farms.com

International grain markets are making significant moves to ensure they have a sustainable suppliers or customers as some American grain exporters await revamped trade deals.

Brazil, for example, is investing to increase its 2018-19 soybean acreage to 36.2 million hectares (89.45 million acres). The goal is to produce up to 120 million tons of soybeans to ensure sufficient supplies for  China while it remains in a trade dispute with the U.S.

“A good harvest in the southern hemisphere should guarantee the supply of soybeans to China,” Andre Debastiani, a partner at Brazil Agroconsult, told an industry conference in China, Reuters reported yesterday.

Since China imposed a 25 percent tariff on U.S. soybeans in July, American soybean exports to China have dropped dramatically.

A U.S. customer in the Middle East is also starting to look elsewhere for its grain imports.

Iraq, which imported 3.2 million tons of U.S. wheat in 2015, is sending a delegation to Russia to discuss whether Russian wheat can fill a gap in Iraq’s supply chain.

The Middle Eastern country needs an annual wheat supply of between 4.5 and 5 million tons, and has an import gap of about 2 million tons per year, Reuters reported.

And a European corn producer is hoping it can step in to meet China’s needs in the absence of U.S. corn.

Ukraine is expected to produce about 27 million metric tons of corn this year. Of that crop, between 3 and 5 million tons may go to China, Nikolay Gorbachov, president of the Ukrainian Grain Association, said at the Global Grain conference in Geneva, Switzerland, Bloomberg reported.

Ukraine has also increased its exports of sunflower meal and barley to China, Gorbachov said.


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Funds Ditch Ag Commodities, Chase Stocks Amid an End to Middle East War, & Trade Deal Buzz

Video: Funds Ditch Ag Commodities, Chase Stocks Amid an End to Middle East War, & Trade Deal Buzz


The 12-day war between Iran-Israel came to an end sending crude oil futures plunging as the big fund speculators removed the war risk premium.

The weather risk premium in the Ag complex is sending corn, wheat and soybean futures lower on month-end selling ahead of the market moving USDA quarterly grain stocks and acreage reports on June 30th.

Instead, funds were chasing and sending tech stocks higher with the S&P 500/NASDAQ indexes setting new all-time record highs!

June 1 USDA Hogs and pigs report was slightly bearish while the U.S. $ Index traded to new contract lows as the de-dollarization that began in 2014 continues.

Feed in the form of soybean meal futures for livestock producers got cheaper, trading to new contract lows.

The Stats Canada seeded acreage update was bullish canola and wheat.