Brazil, Argentina, Russia & Baltic States exporting more NON-GMO.
China soybean salvo is well-timed shot in trade skirmish
Marketwatch By William Watts
Published: Apr 4, 2018 6:11 p.m. ET
"Timing is everything. For Beijing, the Trump administration’s decision to announce 25% tariffs on Chinese goods comes at an opportune time. After all, China made no secret it would retaliate in an aim to make President Donald Trump and congressional Republicans pay a political price. The strategy centers on soybeans. China is the world’s largest soybean importer and annually buys around a third of the U.S. crop. Beijing on Wednesday said it plans to impose 25% tariffs on the commodity, as well as on other U.S. agricultural products, including wheat, corn, cotton, sorghum, beef and tobacco.Soybean futures fell, with the May contract on ( CHICAGO ) CBOT SK8, +0.22% declining more than 2% to end at $10.1525 after dipping as low as $9.84. The natural question, however, is whether China’s threat really means that much. In the long term, China will likely have little choice but to buy U.S. beans. But in the near term, it can make a symbolic and market-rattling turn away from U.S. suppliers. That’s because Brazil, the world’s second-largest soybean producer, is wrapping up its harvest of a bumper crop as U.S. farmers prepare for planting season. Moreover, this is the time of year when China turns to South America for supply. “Over the next few months, more soybeans will be imported from Brazil in any case, following the seasonal patterns…China could risk sending out a signal — without any particularly significant immediate consequences — that it will not even shy away from hitting U.S. agricultural production at its heart,” said Eugen Weinberg, head of commodity research at Commerzbank, in a note. The market reaction appeared to ring some alarm bells. American Farm Bureau Federation President Zippy Duvall urged Beijing and Washington to return to the negotiating table, saying the trade spat is testing the “patience and optimism of families who are facing the worst agricultural economy in 16 years.” Republican Sen. Chuck Grassley of Iowa, the nation’s second-largest soybean-producing state, said it would be unfair for farmers and ranchers “to bear the brunt of retaliation for the entire country.” Over the longer run, however, it is worth noting that China is heavily dependent on both U.S. and Brazilian soybeans, said veteran grain market analyst Dan Cekander, president of DC Analysis LLC. “China is still going to take 27 million to 28 million tons (of soybeans) out of the U.S. at some point. That’s not going to go away,” he said. Also, Argentina’s crop is set to fall short of earlier expectations, which will complicate any effort by China to cut out the U.S. as a supplier, wrote Stefan Vogel and Charles Clack, commodity analysts at Rabobank. “U.S. soybean export prices will need to decline to the point at which they are competitive despite the 25% penalty,” the analysts said, but that will be partly offset in an environment that will see higher prices in both China and in South America. Meanwhile, other potential buyers will reach for soybeans from the U.S., Cekander said. The Wednesday selloff was in part a knee-jerk reaction that was likely exacerbated by significantly large net long hedge fund positions, he said. Wednesday’s lows probably mark a “reasonable” support level for soybean futures, but more pressure could be in store if rhetoric escalates. It’s important to remember that neither China nor the U.S. have yet imposed any tariffs. U.S. equities bounced back from an early selloff to end with strong gains Wednesday on the apparent expectation that the tit-for-tat announcements are largely negotiating tactics. Needless to say, traders and investors will be paying close attention to headlines. “I think the market is definitely going to stay on edge as long as there are these ongoing negotiations — and there is certainly the possibility that there could be more escalation before there is some resolution,” Cekander said. “It’s problematic for the short run.” ~MarketWatch
DCE: Dalian Commodity Exchange 4/5/2018 last night ~ WAY MORE THAN DOUBLE VOLUME NON-GMO!!
No. 1 Soybeans Vol:370230 OI:272716
No. 2 Soybeans Vol:173580 OI:124680
Soybean Meal Vol:4268346 OI:3962266
Soybean Oil Vol:839270 OI:1024786
From 10/7/2017 DATED ARTICLE, but nonetheless interesting; albeit possible tariff changes.
"Sinograin is the state-owned enterprise in charge of the crop purchase rotation system. Beijing usually starts buying soybeans from the new harvests in September-October to rotate stocks in its strategic reserves, a regular program to maintain stockpile quality & protect farmers’ profits. China’s soybean output is expected to reach 15 million tonnes for 2018. China imported 95 million metric tons of soybeans in the 2017/18 crop last year, (3.49 billion bushels) & will keep increasing imports an average 3.5 million tons per year for the following five years. In total, the country plans to import 110 mmt of soybeans (4.4 billion bushels) in 2022, said Liwei Zhang, director of market information at China Grain and Oil Information Center (CGOIC). Zhang made this estimate as he attended the American Soybean Association Beijing office as it celebrated its 35th anniversary recently. “From the year 2008 to 2016, China’s soybean import increased 6.2 mmt by year,” said Zhang. “Several reasons caused this huge import increase: first, Chinese government policy of floor price purchasing forced crushing plants to international markets, while most of the domestic beans were bought by the state reserve; second, Chinese domestic soybean production decreased, because of the lower comparative profit to other crops, such as corn and rice. “From this year on, to the following five years, we estimate that soybean import increase will be 3.5 to 4.0 mmt by year, due to increase in domestic production, and slowdown of feed demand,” said Zhang. Since 2015, China started a program to adjust the supply side of reforming farm products. One of the big changes will be to cut down corn acreage and increase soybean production. According to Ministry of Agriculture projections, by 2020, Chinese farmers will plant 140 million mu (23 million acres), with a yield of 30 bushels per acre, for a total output of 18.9 million tons (694 million bushels), an increase of 7 million tons from the year 2015. According to CGOIC, after so many years of faster development, Chinese feed production growth will slow down a little in the next five years. Feed production will increase to 220 mmt in 2020, from 210 mmt currently; this is an increase of 5% in five years. Meanwhile, China will increase ethanol production in the next five years. The country will produce 10 million tons of ethanol (1.66 billion gallons) by the year 2020, almost three times higher than the current level. “Increase in ethanol production will result in more DDGs production in the country, to substitute some of the soybean meal supply,” said Zhang."
~Sourced.
The Baltic states & Russia are now supplying more & more organic NON-GMO soybeans to China. With Brazil & Argentina ramping up, we believe the USA poison pesticide GMO's will be fazed out sooner than most think.
NOBODY GLOBALLY DESIRES TO EAT POISON PESTICIDE CARCINOGENIC FOOD!
( Except USA citizens FORCED TO by their government; AS MOST COUNTRIES BAN GMO FOOD FOR HUMAN CONSUMPTION! )
>>> GO YSYB! >>>>>>>>>
