The renegotiation of the Nafta treaty proposed this week, as President Donald Trump backed away from a threat to withdrawn the US from the agreement, could bring "fairer treatment" for the country's wheat farmers, officials said.
The plan includes cuts to corporate taxes, taxes on repatriated corporate earnings and individual taxes. As expected, the Border Adjusted Tax (BAT) was not proposed. The plan will face heavy scrutiny from Congress and is unlikely to pass in its present form.
Real gross domestic product (GDP) increased at an annual rate of 0.7 percent in the first quarter of 2017, according to the "advance" estimate released by the Bureau of Economic Analysis. In the fourth quarter of 2016, real GDP increased 2.1 percent.
This morning we kick off the day with Employment Cost Index and the 1 st Quarter GDP at 7:30 A.M. and at 9:00 A.M. we have the Chicago Purchasing Managers Index with earnings to follow throughout the day.
WHEAT General Comments: Wheat closed high as cold weather hit the Great Plains and potentially caused some crop losses and as continued wet weather in the northern Great Plains and into the Canadian Prairies became more important.
COTTON General Comments: Cotton was lower in response to a weaker than expected export sales report. The sales were below 200,000 bales after weeks of sales at or above 300,000 bales and often above 400,000 bales..
The previous week's level was revised down by 1,000 from 244,000 to 243,000. The 4-week moving average was 242,250, a decrease of 500 from the previous week's revised average. The previous week's average was revised down by 250 from 243,000 to 242,750.
Wheat prices broke below key long-term support levels around the $4.15 level basis the July KC Wheat and the market was able to rebound back into these levels this week, but have failed to move back above these levels.
Soybeans turned their short-term trends down this week after three weeks of sideway trade which really did nothing to spark any buying interest. Soybeans had taken a sharp drop off their highs since turning down in early March.
Was is just another example of Trump brinkmanship, the talk that the US president was to withdraw the country from the Nafta trade agreement with Canada and Mexico – reports that sent jitters through agricultural markets?
Cash trade was higher last week as prices traded at some of the highest levels seen since early last year. Cash traded at $132 and futures prices also traded alongside the cash also raising prices to levels seen since the bottom made last October.