Trade War Rattles Oregon Economy
The Bulletin – 09/03/2019
Oregon farmers, like those across the country, are struggling to predict how the trade war will impact them. “In general, this uncertainty with trade issues certainly weighs heavily,” said Steve Mercer, communications vice president for U.S. Wheat Associates, which represents farmers in Oregon and elsewhere. Characteristic of its unpredictable approach, the administration suddenly threw Northwest farmers a lifeline Aug. 25 — announcing it had cut a deal with Japan and indicating lower wheat tariffs would be part of the bargain. Yet farmers remain wary, since the deal isn’t final and details aren’t public. Mercer said the trade war is making domestic farmers less competitive as customers overseas reconsider long-term relationships with their American suppliers.
Japan Trade Deal Still Taking Shape
Agri-Pulse – 09/04/2019
White House officials are telling the U.S. ag sector that they are going to win big in the miniature trade pact announced on Aug. 25 after Presidents Donald Trump and Shinzo Abe met on the sidelines of the annual G7 summit, but details are either not being divulged or haven’t yet been nailed down, government and industry sources tell Agri-Pulse. America’s farmers are going to be “very happy” with the deal, which will contain tariff cuts that resemble the increased access to Japan’s market in the former Trans-Pacific Partnership, one government official said…“We don’t think there’s any reason we’d get less than even footing with our competitors in Canada and Australia,” said Steve Mercer, a spokesman for the U.S. Wheat Associates. If the Trump administration does come through for U.S. wheat, it will be a major relief for the sector. The U.S. sells about 3 million metric tons of wheat to Japan yearly, but the U.S. grain is getting more expensive. Japan has already cut tariffs twice on wheat from Europe and CPTPP countries. As of April 1, U.S. wheat became about $20 per ton — roughly 55 cents per bushel — more expensive than wheat from Australia, Canada and elsewhere
Drought Brings Clouds for Australia Wheat, Silver Lining for Black Sea Suppliers
Reuters – 09/04/2019
A third straight year of drought in Australia, blighted by forecasts of below-average rains during the crucial spring growing season, means the country’s wheat crop could shrivel by 10% from previous forecasts, traders and industry officials say. And the gloomy prospects for wheat output in Australia, once the world’s leading supplier, offers a silver lining to rival Black Sea grain producers such as Russia and Ukraine seeking business in rapidly growing Asian markets. Wheat production in Australia could drop below 19 million tonnes, industry participants expect, down from the 21.2 million tonnes estimated by the Australian Bureau of Agricultural and Resource Economics and Sciences (ABARES) in June.
Flour Millers Want Dumping Duty on Turkish Flour Extended
Manila Standard – 08/30/2019
Philippine wheat flour millers want another five years of dumping duty imposed on Turkish flour, claiming the product remains a threat to the local industry still recuperating from losses caused by the import. The Philippine Association of Flour Millers, in a letter to the Department of Agriculture, requested the agency to endorse to the Tariff Commission the local flour millers’ request to initiate an expiry review of the anti-dumping duty on wheat flour from Turkey. The TC announced the initiation of expiry review Thursday. The preliminary conference is scheduled on Sept. 9. The TC first imposed the dumping duty on Turkish flour on January 8, 2015 after determining that dumped Turkish flour posed a threat to the local industry. The duty will end on January 8, 2020, five years after it was imposed. An expiry review will determine if there is a need to extend the dumping duty imposition. The Philippine Anti-Dumping Law (Republic Act 8752) requires that a petition for extension be filed at least six months before the expiry date
Weak Wheat Prices
KYFR-TV – 09/03/2019
This has been a tumultuous season for North Dakota farmers across the board. Wheat, like many other crops, are fighting historically low prices. For the past few years, wheat has seen prices in the low-$5 range, a reach for what they need to break even. Pair that with a successful yield, farmers are left with few options. With harvest season under way, much of the grain crop is coming in strong, but it has nowhere to go. “Historically speaking, in the summer and fall of 2016, we were down to about $4.20 a bushel, so it’s been about three years since we’ve been down to these price levels,” said Jim Peterson, North Dakota Wheat Policy & Marketing director. This extended trend of low prices has hurt farmers’ margins. Many are feeling pressured to sell for whatever they can get. Others are finding ways to store the extra grain until the market brings the price back up. “We need, basically, another $2 minimum per bushel on this wheat price level to make it to a break-even point. And, that’s what’s so disheartening about it. We’ve got a beautiful crop and we’re still gonna probably get a negative of $80 to $100 ,” said wheat farmer Dean Goetz.
Source: U.S. Wheat Associates