President Donald Trump recently told reporters a Phase Two agreement with China is not likely. The President said aboard Air Force One last week, “I don’t think about that,” adding, “The relationship with China has been severely damaged.”
Bloomberg News reports the Trump administration continues to pressure China over the COVID-19 outbreak, alleging a cover-up by China, among other things. Regarding his relationship with China, Trump says, “They could have stopped the plague, they didn’t,” referring to the COVID-19 pandemic.
The Phase One agreement included $200 billion of U.S. agriculture exports over two years. However, trade analysts say China isn’t purchasing at a pace to reach that level yet, and some say the level of purchases needed to meet the total is unattainable.
Last month, state-owned companies in China suspended purchases from the United States over political issues. Also last month, Trump said the Phase One agreement was “fully intact,” the same day adviser Peter Navarro said it was effectively dead.
A total of 50 members of Congress sent a bipartisan letter to U.S. Trade Representative Robert Lighthizer this week, urging him to work swiftly on a Phase Two Agreement with Japan.
The letter was also sent to Ag Secretary Sonny Perdue. They say the recent Phase One agreement with Japan made progress on several important issues, but American farmers and processors remain at a disadvantage against competitors, thanks to the Japan-European Union and the Comprehensive Progressive Agreement for Trans-Pacific Partnership agreements.
That’s why Wisconsin Representative Ron Kind and his colleagues are asking Lighthizer and Perdue to maximize opportunities for dairy farmers by addressing these remaining gaps and inequalities in market access during the next round of negotiations. Due to depressed milk prices and a suffering rural economy, dairy farmers are facing tough conditions and struggling to stay afloat.
The USDA says 6,000 dairy farms have gone out of business over the last several years, underscoring the need for trade agreements that can expand overseas markets for the U.S. dairy industry. The letter also points out that Japan is one of the top five overseas markets for U.S. dairy products and the demand will only continue to grow.
The United States and Kenya began trade negotiations Wednesday, seeking to enter a free trade agreement. The U.S. Chamber of Commerce applauded the progress, saying a deal could “strengthen and deepen our relationships with economies across the continent” of Africa.
Kenya is included in the African Growth and Opportunity Act, which is set to expire in 2025. The U.S. Chamber says a Kenya free trade agreement will provide American businesses the certainty they need to continue investing in the growing market. Agriculture goals for the U.S. include securing full market access for U.S. agricultural goods in Kenya by reducing or eliminating tariffs.
Further, the U.S. seeks to eliminate practices that unfairly decrease U.S. market access opportunities or distort agricultural markets for the United States. In 2018, U.S. total exports of agricultural products to Kenya totaled $37 million. Leading domestic export categories were $10 million of coarse grains, $6 million of wheat and $5 million of pulse crops.
Today, the U.S-Mexico-Canada Agreement (USMCA) officially enters into force, a culmination of years of work to update and improve the North American Free Trade Agreement (NAFTA), offering partners improved agricultural market access and freer, fairer trade between the countries.
“This agreement solidifies our country’s most important and strategic trade relationships with our best customers and promises further economic growth in tandem with our most-valued partners – Mexico and Canada,” said Darren Armstrong, U.S. Grains Council (USGC) chairman. “We appreciate the administration’s hard-won efforts to deliver and implement an agreement that includes significant improvements and offers more modern approaches to trade and we thank our partners in both Canada and Mexico whose efforts have been equally appreciated and fruitful.”
From negotiations to ratification, the Council worked and continues to work within the industry and with Canadian and Mexican corn, sorghum, barley, co-products and ethanol customers to ensure the needs of the U.S. grains sector are met and USMCA will build on the success the U.S. experienced under NAFTA.
“We often hosted Mexican buyers to the United States, sent U.S. farmers on missions to Mexico and have continued to market the importance of our trade relationships with our stakeholders in both countries,” said Armstrong. “Both the Council’s leaders and members are very pleased to see USMCA enter into force today and look forward to many prosperous years for our country’s farmers and those in Mexico and Canada.”
Name change for INTL FC Stone. China & the growing corn deficit, Army worms-is that a concern for China. Where are we at for Phase One with China…a lot of opposite information. Progression of the winter wheat harvest. How are drought areas dealing with harvest? Early Russian harvest is better then expected. Bayer has a deal with Round-Up & dicamba. Hogs & Pigs report out on Thursday. Update on African Swine Fever
Non threatening weather, crop progress report-has some questioning percentage.
Is the issue with China a trade barrier or more of a COVID issue
Livestock…China & Tyson Foods will set a stage for other proteins.
Cold Storage Report. Hogs & Pigs report out on Thursday.
China Sunday suspended poultry exports from an Arkansas Tyson Food’s processing plant where workers tested positive for COVID-19.
China’s General Administration of Customs announced the suspension after Tyson Foods confirmed a cluster of COVID-19 cases at its facility in Springdale, Arkansas.
A Tyson spokesperson told Reuters the company is investigating the matter, adding, “It is important to note that the World Health Organization, the Centers for Disease Control and Prevention, USDA and the U.S. Food and Drug Administration agree that there is no evidence to support transmission of COVID-19 associated with food.”
China also halted exports from a pork processing facility in Germany following an outbreak of COVID-19 at the plant. China has stepped up food inspections for the novel coronavirus in recent weeks. Reuters says Beijing began testing meat, seafood and fresh produce for the coronavirus last week, and some ports were opening all containers of meat to carry out coronavirus tests.
Farm Partners Topics Discussed: – The current state of the corn/soybean market – Pressure from South America for the soybean crop – Safrinha corn crop condition – Spring bounce for row crops – corn/soybean export pace – Ethanol demand – Bottom Line: What will it take for the markets to move higher from here?
The Friday conversation with Jeff Peterson of Heartland Farm Partners. This weeks WASDE report, export demand, weather market & what will it take to move markets.
Cattle market has some bearish feel to the trade. Nothing exciting in the cash cattle market. Will we see boxed beef continue to drop? What about all the meat that is “sitting around”? Beef lower, cash lower, Latest inquiry from the Justice Department. 60 days yet of muddy waters to get through. Pork exports ALL TIME high. Are we building premium into the back months? Friendly to the grains.
Update 5/12/20: The Nebraska Ethanol Board has made the decision to cancel the Ethanol: Emerging Issues Forum 2020 due to Coronavirus precautions. But….. Plan to join them for the 2021 Forum on March 24-25 in[...]
BBI International has announced this week that the 2020 International Fuel Ethanol Workshop & Expo, the ethanol industry’s largest conference, has been moved due to the outbreak of COVID-19. Originally scheduled for mid-June in Minneapolis,[...]