News & Media

Market Briefs for August 16, 2017

Dicamba-impacted soybeans
The number of dicamba-impacted soybean acres across the U.S. continues to increase and is pegged at 3.1 million as of Aug. 10, according to surveys of agricultural extension agents conducted by Kevin Bradley, an associate professor in the University of Missouri’s Division of Plant Sciences. Official dicamba-related cases currently being investigated by departments of agriculture in 17 states across the south and Midwest have also risen, from 1,411 to 2,242, Bradley reports.

Joint NAFTA statement
American Farm Bureau Federation, the Canadian Federation of Agriculture (CFA) and Mexico’s Consejo Nacional Agropecuario will issue a joint statement this week in support of the North American Free Trade Agreement (NAFTA). That could be a signal the groups do not want their country’s trade policy negotiators to use agriculture as leverage to garner other priorities. Meanwhile, U.S. Department of Agriculture Secretary Sonny Perdue, CFA President Ron Bonnett and Bosco de la Vega of Consejo Nacional Agropecuario were each scheduled to speak during an event Aug. 16 at the National Press Club in Washington.

Trading concessions for China?
President Donald Trump continued to signal the possibility that he may ease his rhetoric over Chinese trade practices if Beijing takes steps to help contain Pyongyang’s nuclear program.

“I think China will do a lot more,” Trump said. “If China helps us, I feel a lot differently toward trade.”

The Trump administration has twice delayed actions related to import restrictions on China’s handling of U.S. intellectual property rights and forced technology transfers. The Commerce Department has been preparing an investigation examining whether to limit imports of Chinese steel.

“All-in” farm bill
That phrase may have several meanings relative to a new farm bill. One is the call for all farm and commodity groups and farm-state lawmakers to work together for a timely, successful bill. Another is the suggestion by some to include an “all-in” safety net that would combine both Ag Risk Coverage (ARC) and Price Loss Coverage (PLC) features that would mean farmers would have only one safety-net option. But the all-in safety-net program proposal would likely face opposition from some commodity groups and lawmakers who continue to favor the two different program options (ARC, PLC) that they want tweaked during the coming farm bill debate. The “all-in” safety net concept was put on the table during the 2014 farm bill negotiations inside ag panel discussions. It was rejected. No major commodity or farm group pushed it at the time, similar to the current situation.

Higher CRP acreage max
The current maximum for the Conservation Reserve Program (CRP) is 24 million acres. Some lawmakers want to raise the maximum by a few more million acres. Budget offsets for that to occur could bring some reforms to the program, such as revising CRP rental rates on a more timely basis, restricting some whole-farm or other ground program access once those current CRP acres are up for program renewal and moving some of those and other acres into the Grassland Reserve Program.

Mills on lumber agreement
U.S. Commerce Secretary Wilbur Ross said he wanted to finish a softwood lumber agreement with Canada before talks on renegotiating the North American Free Trade Agreement began on Aug. 16. But the owners of four lumber mills told Reuters they are “in no hurry” to reach a deal with Canada that does not limit Canadian producers’ share of the U.S. market to a strict percentage. They explained they do not want to settle for a “bad deal” just to avoid a fight in NAFTA. U.S. mill owners want a “clean quota,” with strict market share limits for Canada. They say Canada unfairly subsidizes its lumber producers through low fees for timber cut on public land. U.S. producers get most of their timber from private land where costs are higher.

China may target soybeans
The Trump administration continues to mull action on China regarding intellectual property concerns. U.S. trade officials have long criticized China’s IP enforcement regime for failing to stem alleged online piracy of music, films, books, software and video games. The U.S. Trade Representative also alleges that hackers affiliated with the Chinese government and military infiltrated the computer systems of U.S. companies and stole terabytes of data to provide commercial advantages to Chinese enterprises.

China has several countermeasures it could take in any official trade spat, including legal constraints on foreign companies and import curbs on specific sectors. Under a draft plan, Bloomberg reports soybeans have been singled out as the top product that can be dialed back, according to people familiar with the matter.