Chicago | Reuters – U.S. soybean futures closed at their lowest levels in over a month on Thursday after U.S. President Donald Trump announced new tariffs on Chinese goods while a more favorable weather outlook also sent corn prices down.
Trump said he would impose an additional 10 percent tariff on $300 billion worth of Chinese imports starting Sept. 1, citing insufficient progress in trade talks between the world’s two largest economies.
The most active soybean futures on the Chicago Board of Trade (CBOT) settled down 16-1/4 cents, or 1.7 percent at $8.65-1/4 a bushel, the lowest since June 11.
The latest round of U.S.-China trade talks wrapped up on Wednesday without any visible signs of progress to resolve the trade war, and Trump’s Tweets on Thursday sent global markets broadly lower.
The announcement overshadowed the U.S. Department of Agriculture’s confirmation earlier that a private Chinese company bought 68,000 tonnes of soybeans in the week ended July 25, the first soybean purchase since Beijing offered to exempt five crushers from import tariffs imposed more than a year ago as part of the U.S.-China trade dispute.
Terry Reilly, senior agriculture analyst for Futures International, said China would need to buy a larger quantity of soybeans for the market to react.
“These new purchases have already been factored into the market,” said Reilly.
Forecasts for cooler weather eased concerns about the prospects for the coming corn crop. Conditions for the U.S. Midwest predicted below-average temperatures for this time of year, with rains hitting the Southern Plains.
“These 70-80°F (21.1-26.6°C) days are the perfect weather for the corn to mature,” said John Dee, president and owner of Global Weather Monitoring.
Dee cautioned that the late planting season made analysts unsure whether crops were going to pollinate correctly. Some parts of the eastern corn belt will still be experiencing some dryness, he said.
The most active corn futures settled down 7-1/2 cents, or 1.7 percent at $4.02-1/2 a bushel.
Analysts are waiting for the U.S. Department of Agriculture (USDA) to release its revised acreage numbers in a report due out on the 12th of August.
“This report will set the undertone for the condition of the crop,” said Reilly.
The most active wheat futures were down 11-1/2 cents, or 1.6%, at $4.75-3/4 a bushel, a two-month low.
– Additional reporting by Colin Packham in Sydney and Sybille de La Hamaide in Paris.