The USDA anticipates it will announce payment rates before the end of this year for the second round of Trump tariff payments, said an agency spokesperson on Wednesday. The news followed a published report that the White House was delaying the payments.
Although ag exports are consistently larger than ag imports, that trade surplus is forecast to narrow to $14.5 billion in fiscal 2019, which would be the smallest surplus since the $12.2 billion of 2007, say USDA economists.
Taking a "show me" stance, White House economic adviser Larry Kudlow said on Monday he expected China to roll back tariffs on U.S. farm exports promptly and begin trade reforms in line with the trade deal struck by President Trump and Chinese President Xi Jinping. The White House said over the weekend that China will make "very substantial" purchases of agricultural, energy and industrial goods but analysts saw no firm commitments in the statement.
Pork producers will struggle through this winter with market prices below the cost of production, says economist Chris Hurt of Purdue University. "Record pork production and trade disputes continue to be the near-term drag on prices," wrote Hurt at the farmdoc Daily blog, adding that futures prices in the spring and summer "will be high enough to provide profitability."
U.S. farm income will be slightly higher than expected this year due chiefly to $4.7 billion in Trump tariff payments that will buffer the impact of trade war on commodity prices, says the USDA. With the bailout, farmers are forecast to collect $13.6 billion in direct farm payments, the largest amount in 12 years.
China, formerly the No. 1 customer for U.S. ag exports, will buy a comparatively paltry $9 billion worth of those exports this fiscal year, a startling 45 percent cutback due to the trade war, said the USDA on Thursday.
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Forced by the trade war, China, the world’s largest soybean importer, and the United States, the largest grower, are on the prowl for new soybean trading partners, though neither will fully replace the other soon, said the USDA on Thursday.
The giant of world soybean trade, China, will slash its soy imports by 10 percent this trade year under the dual effects of trade war with the United States and an outbreak of African swine fever, said the U.S. agriculture attache in Beijing. At the same time, USDA data show a sharp decline in soybean exports to all markets and a trade group said tit-for-tat tariffs are putting pressure on pork sales to China and Mexico.
The U.S. share of the Chinese soybean market shrank during the marketing year that ended Aug. 31 and, with the trade war underway, shipments are anemic in the new sales year, says the USDA: "A large pullback in Chinese demand for U.S. soybeans appears likely to continue well into 2918/19."