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Cotton futures posted losses of 12 to 92 point losses on Friday, with March falling 123 points on the week. The outside factors should be supportive but were not, as the US dollar index was down 469 points, with crude oil $0.94/barrel higher. SSDA reported 128,866 RB of cotton sold in the week that ended on 12/26, a 12-week low for 2024/25 bookings. Turkey was the buyer of 41,300 RB, with 30,000 RB sold to Pakistan. Shipments were tallied at 115,813 RB, the lowest in 7 weeks. Vietnam was the destined for 33,800 RB, with 25,300 RB to Pakistan. The Seam reported 10,249 bales of online sales on January 2 at an average price of 60.01 cents/lb. ICE cotton stocks were unchanged on Thursday, at 20,113 bales of certified stocks. The Cotlook A Index was steady on 1/2 at 78.90 cents/lb. The USDA Adjusted World Price (AWP) was released late on Thursday, up 48 points from the previous week at 55.03 cents/lb.
The corn market felt pressure on Friday after a lack luster export sales performance. Futures ended the session with contracts down 4 ¼ to 9 cents, as corn fell with much of the rest of the commodities. March was down 3 ¼ cents on the week. The national average Cash Corn price from cmdtyView was down 9 cents at $4.22 1/4. Export Sales data from this morning tallied 776,992 MT in 2024/25 wheat sales during the week of 12/26, coming in below the 0.8 to 1.4 MMT estimates. That was also down 54.6% from last week and the second lowest for the MY. Mexico was the largest destination of 292,500 MT, with 179,100 MT sold to Japan. Mar 25 Corn closed at $4.50 3/4, down 8 3/4 cents,Nearby Cash was $4.22 1/4, down 9 cents,May 25 Corn closed at $4.58 1/4, down 9 cents,Jul 25 Corn closed at $4.61 1/4, down 9 cents.
The wheat market posted double digit losses across most contracts in the three exchanges on Friday. Chicago SRW futures closed with contracts down 11 1/4 to 16 1/2 cents on the day. March fell 17 ¼ cents this week. KC HRW contracts closed with 12 ½ to 13 1/2 cent losses on the session. March KC wheat was down 15 ½ cents on the week. MPLS spring wheat futures posted 10 to 11 3/4 cent losses on the day. March fell 17 ½ cents since last Friday.The weekly Export Sales report was published this morning, with USDA coming in at a MY low of 140,591 MT in 2024/25 wheat sales during the Christmas week of 12/26. That was below estimates of between 200,000 and 500,000 MT. South Korea was the largest buyer of 35,900 MT, as Thailand bought 29,700 MT.
Taiwan is tendering for a total of 114,650 MT of wheat from the US, with the offers due next Thursday.Mar 25 CBOT Wheat closed at $5.29 1/4, down 16 1/2 cents,May 25 CBOT Wheat closed at $5.41, down 16 1/2 cents,Mar 25 KCBT Wheat closed at $5.39, down 12 3/4 cents,May 25 KCBT Wheat closed at $5.47 1/4, down 13 1/2 cents,Mar 25 MGEX Wheat closed at $5.77 3/4, down 11 3/4 cents,May 25 MGEX Wheat closed at $5.86 1/2, down 11 1/2 cents,
A new economic study paints a troubling picture of the potential results a renewed U.S./China trade war could have on farmers and the ag sector. The study was commissioned by the American Soybean Association and the National Corn Growers Association and conducted by the World Agricultural Economic and Environmental Services.
Soybean and corn exports
- Under a scenario where China reverts to previous tariff levels, U.S. soybean exports to China could fall by 14 MMT to 16 MMT annually, a 51.8% decline from expected baseline levels
- Corn exports to China could decrease by about 2.2 MMT annually, an 84.3% decline from baseline expectations.
- In a more severe scenario with a 60% retaliatory tariff, soybean exports to China could drop by over 25 MMT, and corn exports could fall by nearly 90%.
Price declines
- Under a 60% tariff scenario, U.S. soybean prices could fall by nearly $1 per bushel on average, while corn prices could drop by $0.13 per bushel.
- These price declines would occur at a time when costs remain at record levels and commodity prices are already falling.
Production value losses
- U.S. corn and soybean farmers could lose billions of dollars in annual production value.
- In a worst-case scenario, with Chinese tariffs rising by 60% and other countries increasing tariffs by 10%, projected export decreases could reach $15.8 billion for soybeans, $4.4 billion for corn, $2.3 billion for beef and $2.5 billion for wheat.
Regional economic impact
- States heavily reliant on agricultural exports, such as Iowa, Illinois, and Kansas, could be particularly affected. In these three states alone, GDP losses totaled $3.8 billion through 2019 during the previous trade war.
Input costs
- Farmers reliant on imported machinery, fertilizers and other inputs may face higher costs, further squeezing already tight margins, according to a USDA trade outlook report.
Market share loss
- Brazil and Argentina could increase their exports and gain valuable global market share, potentially difficult for U.S. farmers to reclaim in the future.
- While tariffs could encourage greater investment in domestic manufacturing and agriculture, they also risk destabilizing existing trade agreements like the U.S.-Mexico-Canda Agreement.
Both consumers and farmers could experience inflationary pressures as retailers warn of price increases tied to rising import costs.
Bottom line: The potential for a new trade war poses significant risks to the U.S. ag sector, with wide-ranging impacts on exports, prices and rural economies. The previous trade war’s disruption of around $10 billion per year in exports underscores the magnitude of the threat, and current projections suggest the impact could be even more severe if new tariffs are implemented and retaliation occurs.
World Farming Agriculture and Commodity news - Short update -30th December 2024
In 2024, EU poultry production has continued to increase against the backdrop of a constrained growth in the previous year, stable demand as well as favourable feed costs and output prices, according to the EU Agricultural Outlook report (2024-2035). Changes in the consumption patterns in the EU together with growing export opportunities are set to increase EU poultry production by 770 000 t between now and 2035 (+0.5 % per year between the 2022-2024 average and 2035). A stricter environmental legislative framework and a shift to less intensive production systems will mean that production expansion will only be possible in some EU regions. Unlike avian flu outbreaks in previous years, the incidence of Highly Pathogenic Avian Influenza (HPAI) is expected to extend over the whole year instead of being a seasonal event and will challenge the poultry sector, and more particularly free-range production systems in the EU in the coming years. Thanks to a change in consumption patterns, EU poultry consumption is projected to increase by 0.5% per year between the 2022-2024 average and 2035. This translates into an increase in annual per capita consumption from 24.2 kg to 25.8 kg.
Cocoa closed out 2024 ahead of every major commodity, after a year of poor weather and weak harvests sparked a triple-digit gain for the bean.Cocoa gained about 172% in the past year, briefly reaching a record of nearly $13,000 per metric ton on the international exchange in December.Prices have appreciated dramatically as leading cocoa-producing countries, such as Ghana and the Ivory Coast, have been battered by crop failures. Bean disease, floods, and falling pay for farmers all contributed to a worsening supply crunch.According to ING, global cocoa stocks have dropped to their lowest levels in over a decade. Though the firm expects supply prospects to improve slightly in 2025, weather risks will continue to cloud the market in the new year."Not only are prices likely to remain historically elevated due to uncertainty over the West African crop outlook and tight stocks, but prices need to stay high to keep a lid on demand," ING said.Meanwhile, drought conditions have damaged hope for strong coffee output in Brazil, driving the price of arabica beans to a forty-year high. The commodity rose 67% in 2024.
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