Wheat hits three-month high in anticipation of US-China talks

Published Feb 5, 2025

Tridge summary

Wheat prices have reached a nearly three-month high due to the cautious tariff approach of China and the upcoming potential talks between China and the USA, as well as the looming trade war between the two nations. China's tariffs are seen as balanced and aimed at avoiding a severe escalation. However, there are concerns about the impact of Sino-US trade tensions on agricultural commodities such as soybeans. In China, soybean meal prices have risen, and there is uncertainty about future relations between China and the USA, which could affect the demand for soybeans. Additionally, the grain market has found relief in the one-month delay in imposing 25 percent tariffs on Canada and Mexico by the USA, and the decline in the dollar increases the competitiveness of U.S. grains.

Disclaimer: The above summary was generated by Tridge's proprietary AI model for informational purposes.

Original content

Wheat hit its highest level in almost three months as traders weighed China’s cautious approach to U.S. tariffs and the market awaited details on possible talks between the leaders of the world’s two largest economies. This comes as a new trade war is brewing between Washington and Beijing, the expectations of which have been stirring up grain markets for the past week. However, China’s tariffs, announced on Tuesday in response to the first steps of the United States, are seen as balanced and indicate that Beijing is trying to avoid the worst-case scenario of a serious escalation, according to Bloomberg Economics analysis. “China’s restrained reaction and generally friendly tone in state media and social media ahead of the US deadline indicate an attempt to create a favorable backdrop for the talks,” the report says. It also mentions the possibility that the US tariffs will not be as high as the 60% that Trump threatened during the campaign. In the previous session, grains, ...

Source: UkrAgroConsult