First Thing Today | Grains remain resilient in face of tariffs uncertainty

Good morning!

Grains remain resilient in face of tariffs uncertainty... Corn, soybeans and wheat extended Wednesday’s gains during the overnight session. As of 6:30 a.m. CT, corn futures are trading 2 to 3 cents higher, soybeans are 4 to 6 cents higher and wheat futures are 1 to 5 cents higher. The U.S. dollar index is more than 1,000 points lower, front-month crude oil futures are around $1.70 lower and gold is sharply higher.

China’s leadership gathers for emergency stimulus talks amid trade shock... China’s top leadership convened an emergency meeting today to discuss a broad stimulus package, following a fresh tariff barrage from President Donald Trump that further strained U.S./China relations. While Trump paused tariffs for 90 days on so-called “bad actor” countries on Wednesday, he raised them to 125% for China. According to Bloomberg, China’s high-level discussions centered on boosting housing, consumer spending, and technological innovation, as Beijing moves swiftly to cushion the economy from what analysts say could be a major hit to growth. Bloomberg Economics estimates the tariff shock could wipe out up to 3% of China’s GDP through falling exports. Goldman Sachs cut its China GDP growth forecast to 4.0% for 2025 (from 4.5%), and to 3.5% for 2026. Citigroup revised its 2025 economic growth outlook to 4.2%, down from 4.7%. China has taken regulatory steps to limit outbound investment into the U.S. — a move seen as part of a broader strategy to build leverage in any future trade talks with Washington.

China’s foreign ministry calls the U.S. a ‘21st century barbarian’... China’s rhetoric on its trade war with the U.S. has become increasingly aggressive with the foreign ministry saying the Trump administration’s tariffs have made the U.S. a “barbarian of the 21st century.” Trump’s tariffs will “never make America great again” ministry of foreign affairs spokesperson Huang Jingrui, wrote in an open letter today in Hong Kong’s newspaper South China Morning Post. “A tariff-wielding barbarian who attempts to force countries to call and beg for mercy can never expect that call from China,” Huang said, adding the U.S. is “obsessed with the art of bullying and blackmailing the entire world.”
EU will pause countermeasures to U.S. tariffs... The EU will delay for 90 days implementation of its counter tariffs against the U.S. over the 25% duties Trump imposed last month on the bloc’s steel and aluminum exports. The EU will move forward with the tariffs that would hit around 21 billion euros ($23.2 billion) of U.S. goods and then immediately suspend them when they take effect, people familiar with the matter told Bloomberg. European Commission President Ursula von der Leyen said she wants to give negotiations with the U.S. a chance. “If negotiations are not satisfactory, our countermeasures will kick in,” she wrote on X. “Preparatory work on further countermeasures continues. As I have said before, all options remain on the table.”

ASEAN won’t retaliate... The Association of Southeast Asian Nations (ASEAN) said today it won’t impose retaliatory measures in response to Trump’s tariffs. ASEAN is “deeply concerned” over the U.S. duties and seeks a “frank and constructive dialogue” with the U.S., the 10-nation group (Brunei, Cambodia, Indonesia, Laos, Malaysia, Myanmar, the Philippines, Singapore, Thailand and Vietnam) said in a joint statement. The region will continue to boost internal trade and investment, ASEAN added.

Canada, Mexico remain exempt for now from the 10% baseline tariff... Canada and Mexico are not subject to the 10% tariffs that will now go into effect for goods from other countries. However, both countries are still under separate 25% tariffs tied to fentanyl-related trade policy concerns, though auto exports and U.S.-Mexico-Canada Agreement-compliant goods are protected.

April WASDE out later this morning... Usage updates in USDA’s World Agricultural Supply and Demand Estimates (WASDE) Report at 11:00 a.m. CT will reflect March 1 stocks and trade policies currently in effect. Typically, the April report is rather uneventful, though how USDA will handle usage forecasts in the face of the trade/tariffs turmoil adds some uncertainty. Click here for pre-report estimates.

China lowers corn, cotton import forecasts amid U.S. tariffs... China’s ag ministry cut its forecast for 2024-25 corn imports by 2 MMT to 7 MMT, down 16.41 MMT (70.1%) from last year. It reduced cotton imports by 200,000 MT to 1.5 MMT, down 1.75 MMT (53.8%) from 2023-24. The ministry cited U.S. tariffs for the cuts to expected corn and cotton imports. It left its 2024-25 soybean import forecast at 94.6 MMT, down 10.15 MMT (9.7%) from last year.

Weekly Export Sales Report out this morning... For the week ended April 3, traders expect:

Strike halts grain ship traffic at Argentina’s Rosario ports... Grain ships will be unable to dock or leave Argentina’s Rosario port hub today because of a CGT union strike against government policies that went into effect at midnight, the head of the private port chamber CAPyM said. CGT’s action brings together numerous unions in the country. “We will not be able to dock and moor the ships,” Guillermo Wade, manager of the Chamber of Port and Maritime Activities, told Reuters, citing the strike by the Maritime Workers Union and the river navigators’ union. Ships already moored in ports will be able to load grains and their derivatives, but vessels will not be able to set sail, Wade added.

Exchange raises Argentine corn production forecast, cuts soybean crop... The Rosario Grain Exchange raised its Argentine corn production forecast 4 MMT to 48.5 MMT. The soybean crop estimate was lowered 1 MMT to 45.5 MMT.

CBOT declares force majeure for Ohio River wheat shipping terminals... CME Group, parent of the Chicago Board of Trade, declared force majeure for wheat shipping terminals on the Ohio River due to flooding, the exchange said. High water and/or flooding made grain load-out impossible at delivery points for CBOT wheat futures on the river.

Ukraine hikes minimum export prices for corn and wheat... Ukraine’s ag ministry raised the minimum export price for wheat to $201 per metric ton on a free-on-board basis in April from $146 in March. The minimum corn price increased to $185 per ton FOB from $140 per ton. The ministry gave no reason for the new price levels, but they are calculated on the basis of state customs service data, taking into account the terms of delivery for the previous month and using a 10% discount.

China’s yuan falls to lowest level since before the global financial crisis... China’s yuan fell to its lowest against the dollar on Thursday since the 2008-09 global financial crisis, with the central bank cutting guidance for the sixth successive trading session amid an intensifying trade war with the United States. The onshore yuan dropped to 7.3518 a dollar in early trade, its weakest since Dec. 26, 2007, ending at 7.3429 per dollar, down about 1.2% this month. The offshore yuan was at 7.3565 this morning. A weaker yuan would make Chinese exports cheaper and alleviate some of the tariff impact on the economy. However, a sharp decline could also increase unwanted capital outflows and risk financial stability.

China’s deflationary pressures persist... China’s consumer price index fell 0.1% from year-ago in March, marking the second consecutive decline. While that was milder than February’s 0.7% drop, the building trade dispute with the U.S. threatens to exert further downward pressure on prices. China’s food prices fell 1.4% despite a 6.7% rise in pork. China’s producer prices dropped 2.5% annually in March, the steepest decline since last November and the 30^th straight month of factory-gate deflation. The escalating U.S. trade war heightened worries about mounting piles of unsold exports that could drive domestic prices even lower.

Strong underlying retailer beef demand... Wholesale beef prices declined 24 cents for Choice to $337.86 and $1.45 for Select to $320.61 on Wednesday. Movement was strong at 154 loads, signaling strong underlying demand on weaker values, despite overall high prices.

Cash hog fundamentals weaken... The CME lean hog index is down another 16 cents to $88.00 as of April 8, the lowest since Feb. 12. Pork cutout fell $2.69 to $90.76 on Wednesday, the lowest since Jan. 22, as all cuts except picnics posted sharp losses.

Overnight demand news... Exporters reported no tenders or sales.

See ‘Policy Updates’ for late-breaking morning news updates... For updates to items in “First Thing Today” or any late-breaking morning news stories, check “Policy Updates” on www.profarmer.com.

Today’s reports

• 7:30 a.m. Weekly Export Sales — FAS
• 11:00 a.m. WASDE — WAOB
• 11:00 a.m. Crop Production — NASS
• 11:00 a.m. Meat Price Spreads — ERS
• 11:15 a.m. Cotton: World Markets and Trade — FAS
• 11:15 a.m. Grains: World Markets and Trade — FAS
• 11:15 a.m. Oilseeds: World Markets and Trade — FAS
• 11:15 a.m. World Agricultural Production — FAS
• 2:00 p.m. Slaughter Weekly — NASS