Trade disputes with international trade partners have been a significant cause for market volatility and have been ever-present in the press since the start of 2018. The US announced tariffs on all imported washing machines and solar panels and later added steel, aluminum, and other imports. Trading partners have countered by imposing new and steeper tariffs of their own. While the media has homed in on the evolving and very unpredictable relationship with China and the general plight of the American farmer due to these retaliatory tariffs, the team at Skyline Advisors wanted to dig in to the underlying data to explore more specific figures on the impact to US agricultural products.
We compiled and analyzed data from the USDA’s Foreign Agriculture Service and evaluated just how much China’s tariffs have affected exports of key US agricultural exports. The results are summarized here and the full report is available below.
A copy of the full 30-page report is available here.
Contact our team if you would like to learn more about data, trends, and capital markets activity within your industry, or if you would like to discuss strategic options.
Estimates of economic damage from the 2019 Midwest flooding have reached $12.5 billion, according to AccuWeather, which based its estimates on already-inflicted damages and estimated additional damage and lingering health effects from flooding.
For the first time since 1998, Americans consumption of ethanol fuel declined. According to the Energy Information Association, a Federal agency, consumption fell from 14.5 billion gallons in 2017 to just under 14.4 billion gallons in 2018. The Renewable Fuel Association (RFA), a policy advocate for the ethanol industry, suggests that a change in the overall blend rate, via a decline in RIN waivers, led to the decline.
Super Bowl spending amounted to $14.8 billion, or $18.17 per person, this year, according to the National Retail Federation. The per-person expense is tied with last year’s expense and is the second-highest in history after a record $82.19 in 2016. The total expense was down from last year’s $15.3 billion, as fewer people planned on watching the game (182.5 million this year compared to 188.5 million last year).
Congress just passed a new farm bill with bipartisan support to provide support to farmers as the trade war presses on. The $867-billion bill will provide subsidies to American farmers, legalizes hemp production, rejects stricter limits on food stamps, and makes changes to forest management practice.
Since 2014, low agricultural prices have led to increases in chapter 12 bankruptcies in the Federal Reserve’s Ninth District, reaching levels in 2018 greater than those seen in the wake of the financial crisis. For the trailing twelve months ending June 2018, the Minneapolis Fed – overseeing Minnesota, Wisconsin, North and South Dakota, and Montana – reported 84 chapter 12 bankruptcies in its district. The last time chapter 12 bankruptcies were this high was the same period ending in 2010, which recorded 70 bankruptcies.
Agriculture Secretary Sonny Perdue mentioned Monday that a second, multi-billion-dollar round, estimated at nearly $4.7 billion, of financial assistance will be made to soybean, cotton, pork, dairy, sorghum, wheat, corn, shelled almonds, and sweet cherry producers by December.
In recent years, Americans have tossed traditional favorites Bud, Busch, Miller, and Coors to the wayside in preference of more select brews. Craft beers have risen in sales and production in recent years. However, brewers fear that growth may be stalling. According to the Brewers Association, afer 15% growth in volume in 2015 and 18% growth in the two years preceding, volume growth slowed to 6% in 2016 and 5% in 2017. Last year, overall retail beer sales fell 1.2% and many suspect Americans’ alcohol preference is shifting from beer to liquor.
The United States Department of Agriculture (USDA) said in its acreage report on Friday that U.S. farmers planted an estimated 89.6 million acres of soybeans compared to an estimated 89.1 million acres of corn in 2018. It is the first time in 35 years that farmers planted more soybeans than corn. Both measures are down from 2017 figures but align with analyst expectations for 2018. While growers were expecting better returns on soybeans in the middle of planting season, a brewing trade war with China has filled the soybean market with some anxiety. China is the world’s largest importer of soybeans and the U.S.’s largest customer of the oilseed. Since the planting season has ended and trade tensions have arisen, commodity prices for soybeans and corn have fallen.
The US, European Union, and New Zealand collectively produce and sell more than 80% of the world’s cheese. Due to weather events in New Zealand and Europe, American exports of cheddar cheese have increased 83% in the first few months of 2018 from the same period of 2017, according to HighGround Dairy, a market intelligence firm that is focused on the dairy industry.