Chicago, IL – Soybean futures plunged Friday morning following a renewed threat of tariffs on Chinese goods from U.S. President Donald Trump, escalating trade tensions and dampening hopes for a near-term resolution.
The price drop reflects growing concerns among agricultural markets that a comprehensive trade agreement between the U.S. and China-critical for resuming stalled American soybean exports-is increasingly unlikely. This directly impacts American farmers who have yet to ship any soybeans to China, the world’s largest importer, during the current season.President Trump had indicated on Thursday his intention to discuss these exports with Chinese President Xi Jinping in a planned meeting, but subsequently canceled the meeting and threatened “massive” tariffs.
Chicago soybean futures for November delivery fell as much as 1.9% to $10.0275 a bushel, reaching thier lowest point of the session and marking the largest daily decline as July 7. As of 10:19 a.m. Chicago time, November soybean futures were down 1.7% at $10.0525 a bushel.
The downward pressure extended to other agricultural commodities, with December wheat contracts falling 1.6% and corn declining 1.2%.
China’s announcement of special fees on American ships docking in it’s ports, set to take effect October 14, further fueled the negative sentiment. This move mirrors Washington’s planned imposition of new fees on large Chinese ships visiting American ports on the same date, signaling a continuation of escalating trade disputes.
“This market has been riding on hopes of a commodities trade deal with China, but a dose of realism came in last night,” said Arlan Soderman, chief commodities economist at StoneX. ”That doesn’t mean we won’t get a deal, but the market is now dealing with the reality of how difficult it will be to achieve that.”
