Markets calm as trade war tensions ease with China

Gold shows signs of weakening

This week, global markets have shown signs of calming down as trade tensions between the US and China appear to ease. The US dollar strengthened, while gold prices fell, signaling potential weakening in the gold rally. These topics and many more were discussed in the Ag Commodity Corner+ Podcast with hosts Farms.com Risk Management Chief Commodity Strategist Moe Agostino and Abhinesh Gopal, head of Commodity Research.

Key commodities such as canola and corn have experienced price shifts, with canola reaching new contract highs near $700 per ton, and corn closing lower for the week due to a fast US planting pace.

One of the most notable developments was President Trump’s de-escalation of his feud with Federal Reserve Chair Jerome Powell. Trump, who had previously criticized Powell and threatened to remove him, reversed his stance, signaling no intention to fire the Fed chair. This has brought some stability to financial markets, with investors watching closely for potential interest rate cuts later this year.

As for the trade war, the US and China seem to be softening their positions. President Trump’s administration signaled a desire to reduce the friction between the two largest economies, a move that could prevent a global recession.

Notably, Japan is considering buying more US corn and soybeans, which is seen as a positive development for US exports.

In the commodity markets, the outlook for corn remains higher from strong demand, but a projected 96+ million US-planted acres could weigh long-term, fueled by a fast-planting pace. On the other hand, light cattle futures are hitting new highs due to strong demand. Meanwhile, hog futures have recovered, and some analysts are predicting prices could reach $110-$120.

In conclusion, while global trade tensions may have cooled, the commodity markets remain volatile, and it’s crucial to stay informed on these developments.

Watch the podcast below.

For daily information and updates on agriculture commodity marketing and price risk management for North American farmers, producers, and agribusiness visit the Farms.com Risk Management Website to subscribe to the program, and sign up for the Ag Commodity Corner+ Podcast.