U.S., China trade tensions could bubble over
There’s increasing concern the phase one trade deal could unravel as tensions rise between the U.S. and China.
President Trump on Tuesday said he’s preparing to take action against China over its effort to impose national security laws on Hong Kong. Trump has also been critical of China’s response to the coronavirus outbreak, sparking threats from both sides of walking away from the deal.
DTN lead analyst Todd Hultman tells Brownfield a trade dispute with China is the number one problem for commodity prices the White House could actually do something about.
“I’m not saying the solution is easy, but that is something where our U.S. decisions are making it very tough to get trade going again with China.”
And unlike dealing with the coronavirus, he says pushing for a better trade relationship can make a difference.
“We’re missing out on a lot of trade. Brazil is out-competing us again in the upcoming season by over a billion bushels (according to) USDA. So we really need to rectify that to help our soybean market.”
China might not have a choice but to come to the U.S. for soybeans however, because Hultman says the coronavirus is running rampant in Brazil. He sees that as a major threat to Brazilian export logistics.