Corn, soybeans, and wheat were down; cotton was up for the week. Volatility continues to be prevalent in commodity markets. For row crops, the source of the volatility is primarily weather and the on-again-off-again trade posturing between the US and Canada, Mexico, and China. This week trade friction heated up again with the US announcing tariffs would be implemented on steel and aluminum exports from Canada, Mexico, and the European Union. The three parties predictably responded with retaliatory tariffs on US goods. The proposed retaliatory tariffs have a limited impact on agriculture, however the series of tariffs and retaliatory tariffs likely indicates that an agreement on a new NAFTA is not forthcoming any time soon. An exit from NAFTA could have dramatic implications for the agricultural sector. Trade negotiations between the US and China also hit a bumpy patch
as the US indicated it would proceed with $50 billion in tariffs in retaliation to intellectual property theft concerns with China. These tariffs have not been imposed at this time but if they were imposed and as a result China imposed retaliatory tariffs it would likely have a strong agricultural component. Continue reading at Tennessee Market Highlights.