U.S. sorghum imports hit with steep deposit requirement
China announced this week that it will hit U.S. sorghum imports with a temporary 178.6 percent deposit on the value of shipments in what Beijing deemed a “temporary antidumping measure” amid the government’s ongoing probe of imports of the grain. This comes after a preliminary anti-dumping ruling showing U.S. sorghum imports have damaged the domestic industry. Trade sources cited by Reuters say the fee is much higher than expected and will likely stop U.S. sorghum exports to China and inflate prices for feed alternatives like barley. The initial sorghum probe was launched two months ago after the U.S. announced steep tariffs on solar panels and washing machines. The U.S. exported 4.76 MMT of sorghum to China last year, valued at $1.1 billion. This accounted for the vast majority of China’s 5 MMT in sorghum buys in 2017. A final ruling from China regarding its anti-dumping probe will come at an unspecified later date.

Chinese hog producers increase slaughter amid falling prices
China’s pork production climbed 2.1 percent to 15.4 MMT in the first quarter of 2018 versus a year ago, according to official data released this week, as a quick drop in prices prompted farmers to slaughter hogs. Live hog prices in China plunged 30 percent in the first quarter amid a surge in production by new mega-farms. Farmers fear even lower prices may lie ahead as these facilities ramp up production. In addition, heavy snow in eastern and central China preceding the Lunar New Year holiday in February delayed transport of pigs from north to south, raising market-ready hog supplies after the holiday when demand typically slows. 

Farm bill proposal analysis released
The Congressional Budget Office (CBO) released an analysis of the House Ag Committee farm bill proposals last week. The estimates detail how the legislation relied on shifts in conservation and nutrition spending to fund priorities. CBO estimates the House’s 2018 farm bill would increase mandatory spending on programs by $500 million over 10 years and result in $7 million in deficit savings for the same period. However, overall mandatory spending would increase by $3.2 billion between fiscal 2019 and 2023, the life of the legislation. Costs would drop $2.7 billion over the next five years.

CME resets daily price limits
CME Group will reset its daily price limits for grain and oilseed futures based on a semi-annual review, with the new limits taking effect April 30 for trade May 1. For soybeans and mini-sized soybean futures the daily limit will rise 10 cents to 75 cents. For soybean crush, the limit will rise from $1.41 1/2 to $1.57 1/2. For wheat and mini-sized wheat, HRW wheat and mini-sized HRW wheat, the limits will rise 5 cents to 35 cents. And for soybean meal futures, the limit will rise by $5 to $25 per MT.

Can Canada’s Supreme Court do something NAFTA 2.0 talks can’t?
The Canadian Supreme Court released a decision April 19 that could lead to dismantling of Canada’s supply management system of tariffs, quotas, and price controls that projects Canada’s dairy, egg, and poultry producers. Last week, the Supreme Court of Canada announced it has reached a decision on the legal issue. The decision, some say, has nothing to do with Canadian dairy, egg, or poultry policy. But Canadian producers fear it could be the beginning of the end of a system the 2018 U.S. Trade Representative’s Foreign Trade Barrier Report says “limits the ability of U.S. producers to increase exports to Canada” and “inflates the prices Canadians pay for dairy and poultry products.”

Chinese soybean imports down
China imported 5.66 MMT of soybeans during March, down 10 percent from last year’s shipments at this time but up slightly from February imports of 5.42 MMT, according to preliminary customs data. The shipments were in line with expectations as analysts expected demand to ease after the Lunar New Year, which fell mid-February this year. For the first three months of the year, China has imported 19.57 MMT of soybeans, a 0.2 percent gain from year-ago levels, as demand from the livestock and crushing industry remains strong.

Gas prices to hit four-year high
Drivers in the U.S. will likely pay an average price of $2.74 per gallon for regular gasoline this summer (April through September), according to the U.S. Energy’ Information Administration’s Short-term Energy and Summer Fuels Outlook. This marks the highest average summer gas price in four years and represents a 26-cent rise versus last summer’s average price, EIA details.

EPA to move new WOTUS rule
A proposal to rewrite the waters of the U.S. (WOTUS) rule is likely to go to the Office of Management and Budget within the next month or two, according to John Goodin, acting director of EPA’s Office of Wetlands, Oceans and Watersheds. Previous reports have noted that the EPA and the Corps are writing a proposed rule that defines “navigable waters” along the lines of what the late Supreme Court Justice Antonin Scalia recommended in the Rapanos decision.