Beans Mark One Year Low
Grains down in overnight session
China Responds To Trump With Tariffs Of Their Own, Beans Make 1 Year Lows
Beijing announced that they will counter with $50 billion worth of tariffs on American goods. Soybeans are squarely in their sights, as well as aircraft and cars. President Trump announced $50 billion worth of tariffs on Friday. The proposal will go into effect on July 6 and will hit goods ranging from semiconductors to industrial chemicals with a 25% tariff. Jul 18 beans traded as low as 903.00 per bushel, a year low. Dipping below the $9 handle would make a 2.5 year low.
Managed Money Goes Net Short On Corn; Cut Down Their Longs For Beans
Last Friday’s Commitment of Traders report showed heavy selling pressure by speculative investors for corn, which is now net short by 12,238 contracts. Last week, MM was net long by 78,696 contracts, showing a week on week change of 90,934 lots. Money managers are now only 105 contracts net long due to trade complications with China and excellent US crop conditions. This is the smallest position held by managed money since February. HRW saw an increase in MM’s position of 3,439 to 60,606 contracts net long. Chicago wheat had a marginal increase of 77 lots, bringing MM’s total net long up to 25,135 contracts.
Brazilian Soybean Premiums Rally On Renewed Chinese Demand
Chinese buyers are looking increasingly to Brazil during the time of the year when old crop supplies usually dry up. Spot prices for soybeans from Paranagua increased 40 cents to +120 SK8 just last week. Increases in freight rates due to government mandated minimum prices have added on to the cost of beans. The price floor has also led to a decrease in trucks delivering grain, with 14.2% less in Parangua and 22.4% less in Santos.
South Korea Stops Shipment Of Canadian Wheat Due To GMO
South Korea has suspended any imports of wheat or flour from Canada following the discovery of a GMO variety of wheat from Alberta. This news closely follows Japan’s decision to halt tenders and sales from Canada because of the presence of GMO. Canada is South Korea’s #3 supplier of wheat, accounting for 9.2% of the Asian country’s imports. In 2017, South Korea imported 226,355 MT of wheat from Canada.
The risk of trading futures, hedging, and speculating can be substantial.
FBN BR LLC (NFA ID: 0508695)