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Articles of Interest- Wednesday, June 12, 2019

Articles of Interest- Wednesday, June 12, 2019

US-Mexico Rift Far From Over and Still a Trade Threat

Agri-Pulse – 06/11/2019

President Donald Trump is blurring the lines between immigration and trade by continuing to threaten Mexico with tariffs for its border security policies. Ag sectors in both countries fear the lingering tensions may weigh heavily on their businesses as well as the fate of the U.S.-Mexico-Canada Agreement. Last Friday, Trump pulled back from immediately levying tariffs on Mexico because the country agreed to take strong measures to stop Central American migrants from reaching the U.S., but there’s no guarantee Mexico will succeed in placating Trump at a time when neither Mexico, the U.S. or Canada has yet ratified the USMCA…While a crisis — one that Mexican officials said would have resulted in retaliatory tariffs on U.S. goods — was averted, the uncertainty over the future remains. Late last month when Trump first threatened the tariffs on Mexico, U.S. ag groups and farm state lawmakers came out swiftly to warn that the fate of the USMCA was being jeopardized. “We respectfully ask the administration not to implement these new tariffs,” U.S. Wheat Associates Chairman Chris Kolstad said at the time. “The potential fallout for farmers would be like struggling to survive a flood, then getting hit by a tornado.” Trump may have backed off for now on the tariffs, but the U.S. relationship with Mexico and USMCA are still on shaky ground.

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Australia Cuts Wheat Forecast by 11% as Drought Threatens for Third Year

Reuters – 06/11/2019

Australia on Wednesday cut its wheat production forecast for the 2019/20 harvest by more than 11% as an unrelenting drought across the country’s east coast threatens crops for a third year in a row. The Australian Bureau of Agricultural and Resource Economics and Sciences (ABARES) pegged production of the country’s largest rural export at 21.2 million tonnes, down from its previous estimate in March of 23.9 million tonnes. That would be 14% below the 10-year average of 24.7 tonnes, and mean a third straight year of lower-than-average production – crippling growers and exporting companies, and providing a hurdle to an economy that is already threatening to stall. The bureau said growing regions have received enough rain to establish crops, but many areas have very little moisture left in the soil, making them reliant of rains in September and October to avoid further crop downgrades.

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USDA Lifts Russia, Ukraine Wheat Production Estimate for 2019-20 by 2 Mil Mt

S&P Global – 06/12/2019

The US Department of Agriculture raised the estimates for wheat production from Russia and Ukraine, major exporters from the Black Sea region, by 2 million mt for 2019-20, and exports from the two countries by 1.5 million mt, prompted by favorable weather conditions. Wheat production in Russia for 2019-20 is now pegged at 78 million mt, up almost 9% from 2018-19, while that from Ukraine now stands at 30 million mt, up nearly 20% on year, as per the USDA report released on Tuesday. Russian exports are now projected at 37 million mt and Ukraine exports are projected at a record 19.5 million mt in 2019-20. Wheat crops in the region experienced favorable weather conditions during winter. In the main winter wheat producing regions of Russia — Southern and North Caucasian districts — adequate snow and apt temperatures since early December mitigated the risk of frost damage and saw good moisture reserves for crops, as per analysts.

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Most Oklahoma Farmers Wait for Fields to Dry as 2019 Harvest Inches Forward- Early Reports Hint of Good Yields and Quality

Oklahoma Farm Report – 06/11/2019

Harvest progressed in all areas of Southwest Oklahoma over the weekend, with combines moving today in some parts of South-central Oklahoma and Central Oklahoma. Heavy rains on Sunday hindered progress in many parts. Note that the latest Crop Weather update for Oklahoma shows just 4% of the 2019 crop has been harvested, compared to 43% harvested at this point in 2018 and 32% harvested by this date on average…In most areas it has been a struggle for producers to get into the field but many elevator locations were hopeful to see combines moving later this afternoon in the above mentioned corridors. Grandfield-Harvest has progressed over the weekend with 15% completed. Test weights reported at 59-62 lbs. per bushel. Yields reported from 30 to 45 bushels per acres, with an occasional yield reported higher from time to time. Chattanooga-Harvest in this region is reported 20% complete. Test weights reported from 58 to 62 lbs. per bushel.   Currently wheat from the region is averaging a 60 lb. test weight as of today. Yields reported from 35 to 40 bushels per acre, with some reports coming in at 50 bushels per acre.

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US Winter Wheat Harvest Sees Slow Start Amid Wet Weather Conditions

S&P Global – 06/11/2019

Harvesting for the winter wheat 2019-2020 crop (June-May) reached 4% in the US in the week ended June 9, down 9 percentage points year on year, mostly on the back of severe weather conditions seen in the key wheat-producing state of Oklahoma, latest data from the US Department of Agriculture showed. Wheat in Oklahoma was already planted in a smaller area than in the last marketing season. For the week ended June 9, winter wheat harvesting in the state was down 39 percentage points from the past year, at 4%, the USDA report showed. The state saw major rainfall in May and the adverse weather condition is expected to continue at least for the next week, which could delay harvesting of Hard Red Winter wheat, according to market analysts. Kansas, the biggest winter wheat producing state in the US, is also facing wet soil conditions, which has increased concerns of yield loss, according to the US Wheat Associates. Harvest in Kansas has yet to start.

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Source: U.S. Wheat Associates