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Articles of Interest- Friday, January 25, 2019

Articles of Interest- Friday, January 25, 2019

Take China’s Grain Buying with a Pinch of Wheat

Bloomberg- 1/23/2019

If you’re looking for a glimmer of hope that China’s trade talks with the U.S. are still on track, how about this: The country is considering buying as much as 7 million metric tons of American wheat, people with knowledge of the matter told Bloomberg News. That follows a report in December that it may buy up to 3 million tons of corn from the U.S., too. But don’t get too carried away. While such an amount would certainly represent an increase from current levels–depending, crucially, on what period it would be bought over – there’s precious little evidence that Beijing is about to open up trade in its two most protected sectors.

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Russian Wheat Price Sees Length Build on Prompt as Buyers Seek Alternatives

S&P Global – 01/25/2019

The relatively high cost of Russian wheat loading at deep sea ports — stoked by a strong domestic market — has led to a build-up of stocks at the very prompt as buyers have been seeking alternatives, market sources said Friday. “Russia is shedding a bit more demand [due to its high price]…Inquiries are floating around for French, Baltic and Argentine wheat now,” a source said.

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Singapore’s Olam to Invest $3.5 Billion in Growth Areas; Exit Sugar, Rubber

Reuters – 01/25/2019

Singaporean commodity trader Olam International plans to invest $3.5 billion into key growth areas, such as edible nuts, coffee and cocoa, over the next few years, while exiting four existing businesses to raise funds…the 2019-2024 plan includes growing its soluble coffee business, dairy farming in Russia and flour milling in West Africa, while expanding its onion, garlic and tropical spices businesses. Verghese said Olam planned to expand in wheat processing as its operations have higher extraction and utilization rates than the industry average.

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Trade Wars Impact on Grain Shipping

World-Grain – 01/24/2019

Ignoring the impact of the U.S.-China trade war on the grains industry this year is all but impossible. Particularly in the United States, where the loss of Chinese markets is hitting farmers where it hurts most — in the pocket. The knock-on effects of tariffs and the changes in trade flows that have followed have, of course, been felt along supply chains by those that ship, handle and manage grain.

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Shutdown of Federal Government Causing Concerns for Farmers

The North Plate Telegraph – 01/25/2019

Creighton University economics professor Ernie Goss said the government shutdown compounds slower economic growth already evident, increasing the possibility of an economic downturn in late 2019 and early 2020. Goss said a major impact of the government shutdown, combined with trade issues, can be seen in the Midwest with farmers front and center. Impacts include payment delays in the $12 billion in government farm support earmarked to offset the ongoing trade dispute with China, as well as government loans.

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Source: U.S. Wheat Associates