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Trade news adds to market volatility

Arlan Suderman, the chief commodities economist with Stone X Group, says the U.S. and China have reached an agreement on rare earth minerals, which provides more certainty for the markets.

And Suderman says more agreements between the two countries are expected.

“The two things we can learn from that is, first: agreements can be reached with China, and second: it illustrates this will be a long process to deal with all of the issues between the superpowers. Grain and oilseeds are down the road somewhere in the process.”

President Trump announced on Friday the U.S. would end all trade discussions with Canada immediately, because Canada put a tax on American technology companies. Suderman says it could directly impact several ag products.

“The crude oil we import from Canada into Midwest refineries, diesel prices we pay on the farm, fertilizer and spring wheat that comes from Canada and U.S. ethanol that goes into Canada.”

Suderman says he’s interested to see how Canada responds.

The Trump administration says it’s also close to agreements with 10 other countries ahead of the July 9 deadline.

“I think part of the Trump book is to keep people guessing in the negotiations so they don’t really know what his next strategy is.”

Suderman says the next two weeks are important for trade and he remains optimistic for more widespread agreements that lower tariffs across the board, spurring economic growth and demand for U.S. commodities.