Headlines:
Mexican Officials Optimistic About NAFTA News in Coming Days
Mexican negotiators are optimistic about the possibility of getting a NAFTA deal and are hopeful of progress in coming days, the country’s deputy economy minister said ahead of a second ministerial meeting in Washington later this week. “You are going to see hopefully news coming out of Washington in the next few days. There is optimism,” Juan Carlos Baker, deputy economy minister and member of the NAFTA negotiating team, said on Tuesday. “I would say that we realized there might be conditions for getting a NAFTA deal,” he said in Geneva, where he met other trade allies to discuss possible responses to U.S. President Donald Trump’s threats to unilaterally impose tariffs on car imports. Stop-start talks to renegotiate NAFTA have dragged on for more than a year, with similar moments of optimism in the past. The talks recently suffered a setback when Trump imposed steel and aluminum tariffs, triggering retaliation from Mexico and Canada, and followed by his threat to target cars next. Mexican Economy Minister Ildefonso Guajardo said sticking points in the NAFTA negotiations that restarted between Mexico and the United States last week include dispute resolution, auto sector rules, and a U.S. proposal to scrap the $1 trillion trade deal if it is not renegotiated every five years. Guajardo, who has said in recent days he thought the outline of a deal could be agreed on in August, is due in Washington to talk with U.S. Trade Representative Robert Lighthizer on Thursday. Jesus Seade, the chief NAFTA negotiator for Mexico’s President-elect Andres Manuel Lopez Obrador, told French television on Tuesday he thought a final agreement could be ratified by the new U.S. Congress after the November U.S. midterm elections. Mexico, the United States, and Canada have been trying to forge a revamped version of the 1994 trade pact since last year at the behest of Trump, who says he wants a better deal for U.S. business and workers.
EU Touts Jump in Soybean Imports From U.S.
EU soybean imports from the United States almost quadrupled early in the new marketing year, the European Union said, a week after it struck a deal with U.S. President Donald Trump to avert a trade row, as buyers responded to a sharp drop in prices. The EU said in a statement that the collation of new bi-monthly import data showing the rise was “the first concrete follow-up to the EU-U.S. joint statement agreed in Washington between Commission President Juncker and U.S. President Trump”. However, a spokeswoman for the Commission said the increase was thanks to market forces, rather than any concerted action on the part of the bloc in the wake of an transatlantic accord with Washington to fend off new tariffs. Trump said the EU was going to start “to buy a lot of soybeans” after a deal last month in which the EU offered measures he could sell to voters ahead of November elections. Market analysts said the surge was caused by plunging prices in June, as China largely stopped buying U.S. soybeans in retaliation for trade measures that Trump has targeted at Beijing. As soy imports from Brazil and Paraguay fell sharply, U.S. exports to the EU increased by 283 percent in the first five weeks of the 2018/2019 marketing year compared to the same period last year, the EU executive said on Wednesday. Just over a third of the EU’s imports of soybeans and soybean meal, mainly used in animal feed and in the production of soy milk, came from the United States, with Brazil remaining the main origin of EU imports”
Summary:
Its appears that yesterday’s advances might have been a prime opportunity to profit before the next possible leg down in Beans and Corn. After a strong day yesterday, Corn and Beans gave up much of their gains in the overnight session and over the course of the day following China warning to the US against “blackmailing and pressuring” them over trade as the latest sanctions are set to go into effect today. The corn to soybean ratio fell to 2.38 today which is its lowest point in six years. Soybeans retreated overnight after rumors of so called progress of a US/China settlement proved to be false. Bunge posted losses of $125 million for the 2nd quarter losses from some of its soybean crushing facilities but losses were offset by the sale of an agribusiness unit. Wheat futures continued higher overnight and finished the day higher at the end of the regular session. Weather conditions remain favorable for the advancing wheat harvest.
