Headlines:
Trump Delays Tariff Hike on Chinese Goods, Citing Trade Talk Progress
President Donald Trump said on Sunday he would delay an increase in U.S. tariffs on Chinese goods thanks to “productive” trade talks and that he and Chinese President Xi Jinping would meet to seal a deal if progress continued. The announcement was the clearest sign yet that China and the United States are closing in on a deal to end a months-long trade war that has slowed global growth and disrupted markets. Trump had planned to raise tariffs to 25 percent from 10 percent on $200 billion worth of Chinese imports into the United States if an agreement between the world’s two largest economies were not reached by Friday. After a week of talks that extended into the weekend, Trump said those tariffs would not go up for now. In a tweet, he said progress had been made in divisive areas including intellectual property protection, technology transfers, agriculture, services and currency. As a result, he said: “I will be delaying the U.S. increase in tariffs now scheduled for March 1. Assuming both sides make additional progress, we will be planning a Summit for President Xi and myself, at Mar-a-Lago, to conclude an agreement. A very good weekend for U.S. & China!” Mar-a-Lago is the president’s property in Florida, where the two men have met before. The president did not set a new deadline for the talks to conclude, but he told U.S. state governors gathered at the White House that there could be “very big news over the next week or two” if all went well in the negotiations.
In Argentina, Welcome Rains Seen Boosting Soybean Harvest
Rain which has boosted Argentina’s soybean heartland after a hot, dry spell should ensure a bumper crop as yields are set and the harvesting season approaches, experts said on Monday. The rains should keep the country on track for an estimated 53-million-tonne soy harvest, critical for the country’s economy after it was battered last year by an extended drought and a plus for President Mauricio Macri ahead of elections this year. “It had been a fortnight without rain, temperatures had been increasing and we’re at a critical stage of growth for most of the crops. So, it’s a great thing the rains came,” said Esteban Copati, head analyst at the Buenos Aires Grains Exchange. Argentina, the world’s third largest exporter of soybeans and corn, suffered a heat wave last week that dried up much of the water in the soil and had many watching the skies for rainfall over the weekend. In Argentina’s core grains area, most areas received about 30-50 millimetres (1.2 to 2 inches) of rain of the last few days, with some getting over 100 mm (four inches), said German Heinzenknecht, a weather specialist with the Applied Climatology consultancy. He said the latest rains meant that crop yields, a measure of the amount of produce from a given area, were now “practically locked in”. Earlier in the season, marginal growing areas outside of the key Pampas grains belt were flooded by weeks of excessive rains. Since then, Argentina has been hit by a heat wave that has benefited flooded areas while raising concern about parched conditions in other parts of the country.
Summary:
Overnight gains from the announcement from the President that he would hold off increasing tariffs for now because substantial progress had been made in talks with China. Those gains did not carry over into the regular session today and Wheat continues post very large losses with another near 18 cent loss on the day. China sold wheat from reserves for 2,210 yuan per tonne. As far as US/China negotiations are concerned, intellectual property rights remains the biggest sticking point. Sonny Perdue said China is interested in corn, ethanol, dried distillers grain, beef and poultry. All of course contingent on the deal the US and China can reach. On Friday, China committed to 10 mmt of old crop soybeans, a sign of progress. In January China took 4.93 mmt from Brazil.
