Trade | Field 2 Field

May 4, 2022May 4, 2022

Market Prices are Still Higher, But How long?

Market Prices are still higher, but for how long? Commodity markets are rarely dull and sometimes are outright wild. One-quarter of the way into 2022, and we’ve seen a lot of upward pressure in several commodities. The curious question is how long is this going to last given multiple outside factors that could bring the higher push to a halt.

Mike Zuzolo is the founder and president of Global Commodity Analytics in Atchison, Kansas. He’s been working in the markets in various positions since November 1995. Zuzolo has seen a lot of ups and downs over the years, and the corn market has been near all-time highs for quite a while.

“We’ve been within reach of the all-time high for corn set in August 2012, at $8.43 3/4,” he said on the phone from Kansas. “You have the Hard Red Wheat drought, you have the E15 blend increase this summer, planting delays that are pressuring a marketplace that’s expecting more acres than what the USDA predicted earlier this year.

“And then you have the soybeans getting support from the vegetable oil market, which is supported by the crude oil market, and that is supported by the biggest feature of all, the war in Ukraine,” Zuzolo added.

Over the past four months, Zuzolo said there are two overarching factors that had the most influence on the corn market prices. One is the idea from the Federal Reserve that the U.S. had transitory inflation. At roughly the same time the Fed began to publicly acknowledge that wasn’t the case, Russia began its attack on Ukraine. He said most people didn’t seem to truly expect that would happen.

He calls these two events “black rhinos.” Those are events the public knew were possible but kind of turned away from, not thinking they would actually happen. “They aren’t like black swans that we didn’t know where out there,” he said. “You didn’t think they would have the impact on the markets that’s happened so far.”

The market prices could potentially feel the impacts of the war in Ukraine for years. Zuzolo, a long-time market observer, says the length of the impact may depend on who “wins” the war and how big it may get before it’s done.

The commodity markets may feel the impact of the war in Ukraine for years to come. (Photo from Hindustantimes.com)

“Does NATO get involved?” he wondered, “It would then go from two countries directly involved with a lot of support from multiple other countries, or does it expand into a NATO and China and Syria and Iran conflict. The regional conflict would have a great chance of blossoming into more of a full-on world war.”

He thinks the trade is beginning to take the potential conflict escalation into account, “and they should.” A recent weekly stocks report of distillate fuels in the U.S., which is mainly heating oil and diesel fuel, showed America’s distillate fuels at their lowest point since 2008.

“All of the sudden, we have a situation where the wheat market is contending with a situation similar to 2008 in terms of drought potential, knocking down yields,” he said. “Now, we have the energy sector also looking like 2008. If you throw the Russia/Ukraine issue on top of that, then yes, you could have something that lasts for quite some time.”

There are a lot of negative features out there that can affect market prices. He said the trade can’t get a handle on what the supply is right now. Folks in the markets don’t know if the demand is being rationed aggressively enough at this point, because they don’t know if the supply has stopped going down yet.

“The Highly Pathogenic Avian Influenza is in 20-something states right now,” Zuzolo said, “we have a hog herd that is shrinking as of the March Hogs and Pigs Report, and we have a cattle herd that is seeing an almost-weekly drop of one-to-three pounds on a dressed basis. I think we’re only four or five pounds above where we were a year ago, and this is in the beginning of what could be one of the worst droughts in cattle country.”

The International Monetary Fund (IMF) recently cut world GDP by almost a full percentage point just since January. While the IMF puts a lot of it at the foot of the war in Ukraine, Zuzolo says it goes back to the supply chain issues. The U.S. couldn’t afford any more problems on the supply side with energy and crude oil than what the country already faced because of COVID-19.

Thinking long term, Zuzolo spoke to the possibility of the U.S. having to ration exports in order to make sure the U.S. had enough food to feed the country. He doesn’t think it will happen in terms of food exports, but it could happen in other sectors.

“In terms of crude oil, we recently lost a lot more barrels of oil than the trade expected,” Zuzolo said. “It wasn’t because of extra strong demand, it was three times more than the trade expected because we were exporting it out the door. If we can’t bring up the rig count here in the United States and start producing more to meet international and domestic demand, it will then be time to start thinking about rationing.”

Zuzolo said this will have to be a topic of conversation three-to-six months down the line if the war expands and the conflict gets any bigger than it already is. In the meantime, it’s harder than ever to guess what’s ahead in 2022 for the markets.

“I’m gonna stick with what I’ve said recently,” he said. “Because this is a supply cost-push, weather-induced, inflationary move, I still feel the first half of calendar year 2022 is the best time for grain hedgers to get their hedges in place, and yes, I do think they’ll need them. It’s because of the fact that it’s not demand led, and that we are on track for a recession, a greater than 50 percent chance, by the fourth quarter of this year.”

Commodity markets are never dull, are they? (Photo from wikipedia.com)

He says it’s important to get grain hedges in place by the end of June. For the livestock and poultry producer, the second half of 2022 is going to give them a better opportunity to hedge better profit.

“At that point, not only will high market price prices for grains pull down the weights, the HPAI will pull down supply, as will some natural herd reductions. That will all begin to be felt in the market price and the available supplies of market-ready cattle and hogs by the time we get to August and September.

“I still want to hedge the livestock markets, but I don’t think we’re on as big of a timeline as I am on the grains during the first half of the year,” he added.

April 27, 2022April 27, 2022

Port Slowdowns Continue – What’s Behind the Congestion

Port slowdowns are still clogging up the nation’s supply chains, and it’s a big problem to solve. Ray Bowman is Director of the Small Business Development Center of Santa Barbara and Ventura counties in Southern California. He’s also the program chair for the District Export Council of Southern California. The business veteran and trade consultant said things have improved a bit but only on one side of the import-export equation.

“Many things are going on to help with the port slowdowns,” he said on the phone from his office in Camarillo, California. “Most of us have seen the news footage of ships backed up and waiting to unload their cargo. A big part of the backup is the unprecedented buying demand we saw during COVID-19.”

He says the Biden administration moved to get the nation’s ports operating on a 24-hour basis or, at least, get that framework in place to help relieve congestion. Bowman says it’s helped somewhat on the import side of the business, where he says things are about 30 percent better than before.

“Unfortunately, I don’t see that it’s improved on the export side,” Bowman says. “So that’s been tough on American shippers who need to move their goods overseas.

“We knew there would be a significant increase in buying during COVID-19,” he said. “Up until recently, we haven’t seen much of a slowdown in purchasing. Companies are likely still trying to fill orders backlogged for months.”

Ray Bowman is an international trade consultant from southern California with over 30 years of experience. (Photo from edcollaborative.com)

With so much demand for containers on the import side, it’s very difficult for shippers to simply find export containers to load their goods in. Companies started focusing more and more on the import side because they were making so much more money.

When it comes to export containers, fewer goods are leaving the country, so it tends to be cheaper to purchase export containers. They aren’t worth as much to the steamship lines as the larger volume of goods coming into the country. “Because of the demand for imports, steamship companies put all their space availability on the import side,” he said. “They didn’t pay as much attention to the export side, making containers much harder to find.

“The price of those containers is another limiting factor,” Bowman said. “As demand increased, the price shot higher at an unprecedented rate. We knew the price would increase because those costs have gotten suppressed in recent years, but we didn’t expect it to climb by ridiculously huge amounts.”

Limited amounts of containers and exorbitantly high prices hit the small and medium-sized companies harder than the larger businesses. He said the larger companies have economies of scale built into their business structures. Many typically have contracts for consistent shipping availability and trucking services regularly available.

“Small and medium companies buy their services primarily off the spot market,” Bowman said. “So, those higher prices hit those companies even harder than their larger competitors. These things like container shortages haven’t come out of the blue. This has been going on for some time, but when buying spikes as we’ve seen recently, there’s a point at which a system can’t efficiently handle the excess demand. That’s when we get significant port slowdowns.”

In addition to the small pool of available containers, Bowman said warehousing space for unloaded goods is almost maxed out. American warehousing only has roughly three percent of its total space available, which is not a good thing. He says the West Coast ports have less than two percent of space available.

“That only makes the container shortage worse because you have to be able to empty containers to make them available,” he said.

Many truckers who deliver to ports run into something called a “dual transaction” requirement. Bowman said that means if a trucker has a container to drop off, they’d better have another one to pick up. If a driver has a container to pick up, they’d better have another one to drop off. It’s efficient on paper, but if a driver doesn’t have that second part of the dual transaction, they’ll have to go find one.

“Another big challenge at the ports is something called the ‘Box Rule,’” he said. “When a trucker drops off a container to a particular shipping company, you have to have a chassis. Those are the wheels on the bottom that you load the container on.

“These steamship companies have contracts with different chassis makers,” Bowman said. “A steamship line will say, ‘if you’re going to tender one of our containers, you also have the chassis of the company we’ve contracted with.’ If you don’t have the right chassis to go with the right container, you’ll find yourself with cargo, the booking, and nowhere to unload it.”

Bowman, a business veteran with over 30 years of experience, says there is a lot of conversation about not having a Box Rule at the country’s ports. Shippers don’t want to worry about where the chassis comes from. Instead, they want the companies to bill whoever needs to get billed to use a chassis.

“Because of rules like this, roughly 30 percent of truck drivers miss their appointments,” Bowman said. “if you aren’t there on time for whatever reason, such as looking for a chassis, there’s no recourse. You’ve missed your appointment. It’s not unusual, at all, for a trucker to get there hours early and miss their appointment because they’re stuck in a queue.”

Another big reason that things get bogged down is a backlog. A lot of the shipments coming in right now got booked 90 days ago, if not longer.

While shippers, port officials, and government officials are looking at how to rectify these different challenges, Bowman says one of the biggest challenges is a lack of adequate infrastructure at the ports. Most of America’s ports were built when ships were typically much smaller than they are today.

“When I started in the shipping industry, a large ship was around a 4,000-container capacity,” he recalled. “In the 1980s, that was a big ship. Now, we have ships that can hold between 10,000 and 20,000 containers.

“Not only are they bigger, but these ships also just aren’t one carrier like they used to be,” Bowman added. “It used to be one carrier, one ship. You now have what are called ‘Shipping Alliances.’ In fact, there are three big ones in the U.S. As many as four or more steamship lines can be sharing space on one ship.”

Bowman said one of his biggest personal concerns is agricultural goods. If a shipment of consumer electronics takes a long time to get where it needs to go, the products aren’t in any danger of spoiling. Agricultural shipments contain perishable products that won’t wait long for a container and ship.

“A lot of attention needs to get paid to that,” he said. “Those are some of our best exports, and we need to protect that part of the supply chain.”

Bowman is an internationally-respected business consultant who says he’s never seen anything like this before. “There have been port slowdowns in the past, but this is truly unprecedented,” he said.

July 21, 2020July 21, 2020

Communism in America – Honest Talk

Communism is an interesting topic that middle-aged people like me haven’t given much thought to since the era of the Cold War. Are you old enough to remember the days of students diving under their desks during safety drills? Evidently, we should have been paying a little more attention to Communism, because it never really went away. It’s here in the western hemisphere. Don’t believe me?

I came across an interesting document that first showed up in front of Congress back in the early 1960s. More specifically, on January 10, 1963, Congressman Albert S. Herlong Jr., of Florida, read the list of 45 Declared Goals for the Communist Takeover of America into the Congressional Record. The purpose was to give his colleagues, as well as the American population, some insight into Communism and their liberal elite ideas and strategies for America that sound ridiculously familiar. They’re happening right in front of our collective faces.

The list itself was first attributed to Cleon Skousen, a researcher who authored “The Naked Communist.” You really should be shocked at how these have played out in front of us. Some of those 45 steps to Communism have been outdated through the course of history. However, many of them are in play today.

Permit free trade between all nations regardless of Communist affiliation and regardless of whether or not the items could be used for war. We already buy a lot of goods from communist China. There’s also a push from free markets and the European Union to further globalize buying and selling.
Here’s a good one; promote the United Nations as the only hope for mankind. If the charter is ever rewritten, demand that it be set up as a one-world government, complete with its very own military (which it already has). Capture one or both political parties in the United States. They’ve infiltrated the Democratic Party, one that I used to be a member of. If you don’t agree that the Democrats have been taken over, you haven’t been paying attention. As the “Social Justice Warrior Democrats” are pushing for full-bore socialism, this seems to be an ongoing effort. And the “conservatives in Congress don’t seem to feel the need to put a stop to any of it, do they?
Get control of the schools. Use them to promote socialism, soften the curriculum (ever heard the term ‘dumbing down?’), and get control of teachers’ unions. Do you honestly think it’s a coincidence that more and more U.S. college students favor socialism?
Infiltrate the press. Do you think it’s a coincidence that liberal politics gets a lot more positive press than conservative politics?
Gain control of key positions in radio, TV, and the movies. Is it a coincidence that “Hellywood” is pretty much liberal across the board? Doesn’t appear to be.
Present homosexuality, degeneracy, and promiscuity as “normal, natural, and healthy.” Do you see the stuff on TV these days? That would have NEVER been allowed just two decades ago.
Discredit the Bible and emphasize the need for “intellectual maturity.” Ever heard the phrase “religion is a crutch?” That’s where it comes from.
Discredit the Constitution as something inadequate, old-fashioned, and out of step with “modern needs.”

Are you depressed yet? I sure am. You’ll like this one if you live in Minneapolis.

Transfer some of the powers of arrest from the police to social agencies. “Defund the police,” anyone? Oh, and make sure to treat all behavioral problems as “psychiatric disorders,” which no one but psychiatrists can understand or treat.
Discredit the family as an institution. Encourage promiscuity and easy divorce.
Emphasize the need to raise children away from the “negative influence” of their parents. “It takes a village,” anyone?

How about this one, given all the nonsense we’ve seen during the past four months.

Create the impression that violence and insurrection are legitimate aspects of the American tradition; that students and special-interest groups should rise up and use “united force” to solve economic, political, or social problems. Hello… Do Antifa and BLM come to mind? The REAL BLM is a group of “trained Marxists,” according to their co-founder, Patrice Cullors. That’s communism in a nutshell.

As you read these bullet points, do you feel your gut tightening?

Speaking of the liberal elite, it’s long past time to stop voting for the same old people every time we have an election. We have politicians on both sides of the fence who’ve been in Congress since Kennedy was president. Those same people are just NOW going to solve the country’s problems and get us back on track? If they haven’t done so by now, it’s probably time to retire them?

And you, my fellow Christians, take heart. This is Revelations playing out in front of us. We win in the end. The Rapture is coming. I can’t wait. If you haven’t made a real commitment to Jesus, now is the time.

February 2, 2020February 2, 2020

Coronavirus and Possible Effects on Commodity Markets

Coronavirus. As it continues to make headlines, commodity experts are wondering what kind of effect the spread of the virus will have on markets. Joe Vaclavik, President of Standard Grains in Chicago, says the outbreak will have some effect, but it’s hard to tell what kind or for how long.

“It’s not a positive. I don’t know that it’s the biggest negative in the world. It could be, and that’s why you’re seeing liquidation in some of these markets, like the stock market, and that’s why you’re seeing the grain markets soften up. Nobody wants to be long in this stuff. The Coronavirus probably goes the way of SARS, or some of these other similar types of outbreaks that we’ve last a month, maybe two months, maybe the better part of a year. Then, it probably makes its way out of the headline.”

He says the possibility of a significant impact on markets has likely grown over the past couple of weeks.

“There’s always that risk that it turns into something much bigger. It could eventually disrupt the flow of trade. Maybe there’s a country out there that decides to throw up trade barriers and says ‘hey, we don’t want corn from the U.S. because they’ve got too much of that virus going around. There’s always that sort of risk on the table.”

Mike Zuzolo, President of Global Commodity Analytics in Kansas, says the virus will likely have a significant impact on China’s poultry flocks. Separate reports have millions of chickens “on the edge of death.” But they aren’t necessarily sick with Coronavirus.

“Animal feed suppliers cannot get their shipments through, raw materials can’t get through, and this also corresponds with another article from the South China Morning Post that said hedging is not being done, soy meal is not being hedged, so soybeans are not being bought. I think what you’re looking at is probably pent-up demand for the livestock industry and that 300-million chickens die because of not being fed because of Coronavirus. That number of pounds of protein, you’re going to have to replace, eventually.”

There is a long-term buying potential for commodities, but only if the virus outbreak doesn’t last longer than reports are suggesting.

“If China and the scientists are correct and we see a peak in the maximum pressure of this virus, outbreaks of this virus, and, in the next 7-10 days, the price action we’re seeing right now will not last. It will set up a long-term buying potential for commodities.”

Again, that’s Mike Zuzolo of Global Commodity Analytics, as well as Joe Vaclavik of Standard Grains.

November 14, 2019November 14, 2019

Dairy Industry is “Optimistic” at #NAFB19

Dairy industry officials know firsthand that the industry has struggled in recent years, and there’s no question about it. Former Ag Secretary Tom Vilsack, who spoke to broadcasters during the National Association of Farm Broadcasting’s annual convention in Kansas City. Vilsack, is the current President and CEO of the U.S. Dairy Export Council. He says in spite of some tough years for the American dairy industry, there are reasons for optimism.

News broke this week that Dean Foods, America’s largest milk producing company in the dairy industry, filed for bankruptcy. I had a chance for some one-on-one comments with the former Ag Secretary, who preferred to talk more about the positive signs ahead in the dairy industry than the bad news about Dean Foods.

He took a lot of questions from farm broadcasters on a variety of topics in the dairy industry. One of the biggest topics in recent months is the growing market for plant-based “milks.” He and the rest of the dairy industry aren’t happy with these companies referring to themselves as “milk.” The question came from Orien Samuelson, the dean of farm broadcasters and a good friend of Vilsack.

https://www.youtube.com/watch?v=CbopKYObCAs&feature=youtu.be

He says the US-Mexico-Canada Trade Agreement making its way through the House of Representatives, all be it slowly because of Democratic concerns, is another reason to be optimistic. He’s confident that the agreement will get done.

https://www.youtube.com/watch?v=FCURYBZ6IIo&feature=youtu.be

It’s hard to believe that folks in Washington, D.C. are already talking about the next Farm Bill. The reason for that is House Ag Committee Chair Collin Peterson, a Minnesota Democrat, isn’t sure yet if he’ll be running for re-election in 2020. He’s said publicly that decision will be coming in either January or February. Vilsack said even if Peterson doesn’t run again, the next farm bill will get done.

https://www.youtube.com/watch?v=BHU9-7w_CVU&feature=youtu.be

Lastly, as President of the Dairy Export Council, he pays close attention to the country’s export situation, which hasn’t been great at all thanks to trade disputes. In spite of that, with agreements pending in Japan, as well as in North America, exports are another reason to be optimistic.

August 12, 2019August 12, 2019

Trade dispute puts U.S. agriculture right in the middle

Trade is important to agriculture. There, I said it. American agriculture is the best in the world. When you produce goods at the rate we do, there has to be somewhere to sell it overseas. However, thanks to the trade dispute with China, as well as recent disputes with some of our top trading partners, trade isn’t happening with the regularity it needs to.

In turn, when trade doesn’t happen the way it should, prices drop and farmers can’t make a living. I wanted to find out more about the trade dispute and what’s really going on. When you want to learn something like that, you find someone with skin in the game that can teach you the ins and outs.

Dan Ujczo (YOOT-zoh) is an international trade lawyer with the Dickinson-Wright Law Firm of Columbus, Ohio. I’ve known him for over a year now, ever since the dispute began. In typical Chad Smith fashion, my first question is “what the hell is going on here?” How’s that for direct and to the point?

“There was never going to be a deal in which things would go back to the way they were prior to January of 2017, when President Trump was inaugurated,” Ujczo said. “When Trump met with President Xi last December, they both thought we’d have a deal inside of 90 days. Then we heard they would make a deal in May.

“We never thought there would be a deal in which tariffs were completely rolled back,” he said. “Certainly not on the items from List One and List Two, which were an initial 25 percent duty on $50 billion worth of goods.”

When it comes to the items on List One and List Two, Ujczo says the U.S. government talked with industry and looked at the future of manufacturing, deciding then that these are the items we don’t want China taking the lead on. “Tariffs probably weren’t ever coming off those items,” he said.

Here’s the full conversation:

August 8, 2019August 8, 2019

Markets Expert Talks Trade War, USDA reports

Markets occasionally confuse me. However, one part of a career in journalism/broadcasting that I really enjoy is calling people who can educate me on things I really don’t have much expertise in. The older I get, the more fun it is to learn (and try) new things, but I digress. I was working on an assignment with the National Association of Farm Broadcasting the other day and had to find out how the trade dispute between the U.S. and China is affecting commodity markets.

Well, here’s the thing. Commodity markets are not my area of expertise, so I called up Mike Zuzolo of Global Commodity Analytics and Consulting in Atchison, Kansas. He’s been in the markets for 2.5 decades so if you have a question, he’s the guy that can answer it.

As a farm broadcaster/editor, I was curious about how the China announcement that they wouldn’t be buying any American farm products right now was affecting the markets. Obviously, the effect wouldn’t be a positive one. However, as you’ll hear in the conversation, it could have been even worse.

And believe me, before we progress any further I need to stress that no one is saying things aren’t bad right now in the agricultural sector. I wanted to find out what the market reaction was to the announcement from China. Mike said the key reaction market reaction took place in the currency and stock markets.

“Quite frankly, Chad, I think this is maybe one of the few glimmers of good news, or potentially supportive news, for the commodity markets,” he said. “I think we’ve done a fairly good job in the markets of pricing in a good portion of the end result of these trade frictions turning into the beginnings of a trade war. It’s going to be playing out in the currency markets as we go forward.

“The net result is the commodity markets didn’t react as negatively as they could, simply because the strength of the U.S. dollar was dropping,” Zuzolo said. “When the dollar goes down, it makes our goods cheaper to export. At the same time when we had the news out of China, the gold market was making fresh, 6.5-year highs. That too is commodity supportive.”

Here’s the full conversation with Mike Zuzolo.

May 30, 2019May 30, 2019

Trade Opportunities vital for Minnesota farm leaders

Trade opportunities have been, and always will be, important to U.S. agriculture. However, the opportunities aren’t there because of ongoing trade disputes with partners like China. However, with the removal of Section 232 steel and aluminum tariffs on Mexican and Canadian imports, the opportunity for the U.S.-Mexico-Canada Trade Agreement to get through Congress is closer than ever. The prospects, however, depend on who you ask and what their political affiliation is.

That aside, Minnesota Farm leaders gathered recently in Hawley to discuss the current state of the farm economy. They specifically emphasized the importance of trade opportunities across North America. Kaitlyn Blackwelder is the regional project manager for Minnesota Soybean.

Farm incomes fell eight percent last year due in large part to lost trade opportunities and a large supply of commodities driving down prices. And, that has the attention of ag lenders like Jennifer Sharpe, Market Vice President of AgCountry Farm Credit Services.

They and others are worried that unless the U.S.-Mexico-Canada Agreement gets ratified soon, things will only worsen. Ag exports to Mexico and Canada generate more than $1 billion for Minnesota every year. Those exports are only available with abundant trade opportunities. Mike Jurik is a grain merchandiser and works in the area of rail logistics for West Central Ag. He says the uncertainty is a huge strain on everyone in agriculture.

Farm leaders say the new European trade deal with Mexico is allowing the EU to displace U.S. sales in Mexico. The U.S., Canada, and Mexico finalized the deal last November but the pact is currently stalled in Congress. Karolyn Zurn is the American Agri-Women’s First Vice President of Vital Issues and Resolutions. She says the message is clear and direct to Congress.

During the roundtable discussion in Hawley, Minnesota’s farm leaders urged Minnesota’s elected officials to break the logjam on USMCA as soon as possible. Their message was a simple one: farmers need more trade opportunities.

October 19, 2018

USSEC Initiative Helping Move Extra Soybeans

It’s well-known that the trade dispute between the United States and China has hit the U.S. soybean industry hard. China, once the biggest buyer of U.S. soybeans, is no longer purchasing large volumes of beans. That means a lot of the product needs to find new markets. The U.S. Soybean Export Council is working on a new initiative called “What It Takes,” which is designed to help deal with the backlog of soybeans that need to be shipped and sold.

“When the tariff dispute cranked up in April, we were all hopeful that it would be a short-term thing,” said USSEC CEO Jim Sutter. “While it could change at any time, we’d better plan for it to be a longer-term ordeal. It’s made even more challenging by the complex issues between the two countries. There’s more than soybeans involved, with a lot at stake.”

“It was a huge shock to what our industry has gotten used to in terms of marketing plans,” Sutter said. “Our team has been very busy working with exporters. We’re trying to help them in any market where they might have potential customers. We’re also working with importers around the world, telling them about the attributes and possibilities that U.S. soy holds for them.”

Sutter said most overseas markets have purchased at least some U.S. soybeans. There are just a few that haven’t yet. U.S. beans are priced very competitively around the world right now, making them a more affordable option than in past years.

Soybeans have really backed up in the Pacific Northwest. Exporters there typically sell most of their beans to China. USSEC is focusing on encouraging potential customers to come to the PNW as they look for soybeans, and they’ve been successful at it. Taiwan has purchased soybeans in the Pacific Northwest for the first time in 15 years.

“We’re doing a lot of work in other Asian countries, which we think would be a logical destination for those beans from the Pacific Northwest.”

Here’s the complete conversation:

Here’s a refresher on just how USSEC helps improve things for soybean farmers:

August 28, 2018

Mexico-U.S. Wrap Up Part of NAFTA Renegotiation

NAFTA Trade — Daniel Ujczo is an International Trade and Customs Lawyer with the Dickinson Wright Law Firm in Columbus Ohio. He says the agreement this week between Mexico and Canada basically completes their part of the NAFTA negotiations. (Photo from twitter.com)

The U.S. and Mexico announced the framework of an agreement to put a new North American Free Trade Agreement (NAFTA)

in place between the two countries. The question is, what exactly did they agree on as details aren’t entirely clear. Daniel Ujczo is an International Trade Lawyer with Dickinson Wright in Columbus, Ohio, who works on trade for a living. He said this basically means the work to resolve the outstanding issues between Mexico and Canada is done.

“This is the first hurdle cleared in the attempt to get to a final NAFTA,” Ujczo said. “The issues between Mexico and the U.S. primarily surrounded automobiles, but on the agriculture side, included seasonal produce, which was a request that the U.S. put in to resolve the ‘great tomato wars’ between Florida and Mexico. The U.S. agreed to withdraw that proposal.

“There were several other smaller NAFTA issues between the two countries,” he said. “Autos really led the charge until we reached agreement on that. The agreement came about somewhat surprisingly to external observers, but for those of us on the ground, we knew this was happening.”

Ujczo said Mexico and the U.S. went beyond just the bilateral NAFTA issues between the two countries during their negotiations. He said they’ve essentially come up with the rest of the deal on areas like intellectual property rights, in particular. Some observers had expected intellectual property rights to come up later when Canada returned to the negotiating table.

“In short, the U.S. and Mexico have really finished their part of the NAFTA agreement,” Ujczo said. “The next thing is to bring in Canada. Because of the way the procedural and political timelines work, that all needs to be done by Friday, August 31. That makes for a very short window to resolve some long-standing issues between the U.S. and Canada, not the least of which is dairy.”

Here’s the complete interview with Daniel Ujczo: