Pro Farmer's First Thing Today: U.K. Trade, U.S. Unemployment and More

Here are audio highlights from around the ag industry, courtesy of Pro Farmer. ( Pro Farmer )

Good Morning farm country. Davis Michaelsen here with your morning update for Thursday May 14. From Pro Farmer’s First Thing Today, these are some of the stories we are watching this morning:

Corn futures are fractionally lower after a quiet overnight session. Soybeans are trading low range and down 1 to 3 cents in most contracts. HRW wheat futures are 5 to 6 cents lower, SRW wheat is down 4 cents and spring wheat is fractionally lower. The U.S. dollar index is posting modest gains, with crude oil futures also working higher.

Some high-level Chinese execs expect China will speed up its Phase 1 purchases… But they also warned that importing U.S. soybeans may be uneconomical for soy processors in the months ahead. China has purchased big volumes of inexpensive Brazilian beans for delivery in the coming months. Meanwhile China announced it will permit imports of barley and blueberries from the U.S., effective today. China is expected to make a decision by May 19 on whether to hit Australian barley with duties of up to 80% amid allegations the country was dumping the grain.

The United Kingdom is planning to lower tariffs on imports of U.S. ag goods to help move forward on a free trade agreement (FTA), the Financial Times reported today. Britain and the U.S. launched formal negotiations on a FTA last week, pledging to work quickly toward a deal that could help ease the strain of the coronavirus pandemic for both sides.

U.S. unemployment is expected to hit 17% in June and gross domestic product (GDP) will contract at an annual rate of 32% in the second quarter, according to a monthly Wall Street Journal survey of economists. While economists expect a deep contraction in the second quarter, a majority — 85% — continue to expect the recovery will start in the second half of the year.

Mexico’s beef exports to the U.S. will likely grow 12% this year, forecasts Juan Ley, president of Mexico's main cattle growers’ association. Last year, Mexico was the third largest supplier to the U.S., exporting 232,000 MT of beef to the States.

Cattle futures enjoyed some early followthrough buying at midweek, but the market eventually setback, retracing much of Tuesday’s sharp gains. Pressure stemmed in part from a long overdue pullback in the boxed beef market. Lean hog futures took back much of Tuesday’s gains yesterday, amid reports basically all shuttered plants should be back in action this week.