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Beneficial rains coming to central United States... Multiple rain events from Wednesday through at least Nov. 6 are expected to bring needed rainfall to the central U.S., with a general total of two to four inches of rain from Iowa southwestward into northern Texas, according to World Weather Inc. The forecaster says heavier amounts in excess of six inches are possible in some areas. While this will help the winter wheat crop, which had the second lowest initial crop condition ratings ever, more rainfall will be needed to improve drought conditions and support crop development.
EU presses ahead with tariffs on Chinese EVs... The European Union will impose higher tariffs of up to 45.3% on electric vehicles (EVs) from China, ratcheting up trade tensions between the two sides. The EU tariffs differ depending on the manufacturer and will range from about 8% to just over 35%, on top of the existing 10% rate. The extra tariffs were formally approved and published in the EU’s Official Journal on Tuesday, meaning they will take effect on Wednesday.
Meanwhile, Germany said it supports ongoing EU negotiations with China and hopes for a diplomatic resolution to mitigate trade tensions while protecting EU auto industry. Germany opposed tariffs in a vote earlier this month in which 10 EU members backed them, five voted against and 12 abstained.
Canada’s renewable diesel market impacted by slumping credits, U.S. import surge... Canadian renewable fuels producers are facing lower returns on new facilities due to a slump in British Columbia’s low carbon fuel standard (LCFS) credit market, a trend expected to persist amid a flood of imports from the United States. British Columbia’s LCFS credits fell to C$207 in July and C$350 in August, after trading above C$400 for more than two years previously. Tidewater said in August the slump hurt its ability to generate revenues, and blamed weakening prices on a surge in renewable diesel imports from the United States. British Columbia LCFS credit values rose to C$456 in September.
The British Columbia provincial government told Reuters it is not currently considering changes to the program, as credit prices naturally fluctuate based on supply and demand dynamics.
U.S. producers shipped at least 530 million liters of renewable diesel to Canada in the first six months of 2024, a jump from 151 million liters during the same period last year, according to data compiled by Will Faulkner, founder of industry analysis firm Carbon Acumen.
Canada has lagged the U.S. in setting up domestic renewable diesel production. British Columbia is the only Canadian province with an LCFS credit market, which helped encourage Calgary-based Tidewater Renewables to open the country’s first standalone renewable diesel refinery last year. Others are also betting on the credits to support construction of more facilities in British Columbia and other provinces. At the same time, the LCFS has made Canada an attractive outlet for a glut of U.S. renewable diesel.
U.S. goods trade deficit widens sharply in September... The U.S. trade deficit in goods widened sharply in September amid a surge in imports, suggesting that trade remained a drag on economic growth in the third quarter. The U.S. trade deficit widened to $108.2 billion in September from the $94.2 billion gap in August, the widest deficit since commodity supply threats triggered by the Russian invasion of Ukraine drove the trade gap to widen to a record in March 2022. Imports surged 3.8% from the previous month to $282.1 billion, with notable increases for consumer goods (5.8% to $70.9 billion), capital goods (3.1% to $86 billion), industrial supplies (3.8% to $55.8 billion), and foods, feeds and beverages (4.6% to $18.8 billion). Exports fell 2% to $174.2 billion, amid declines for capital goods (-3.3% to $55.9 billion), industrial supplies (-2.5% to $59.7 billion) and consumer goods (-6.3% to $21.3 billion).
Corn leafhopper numbers in Argentina down sharply... The sixth survey of the Dalbulus Maidis National Monitoring Network (corn leafhoppers) indicated there were 90% fewer insects compared to a year ago. The only area with slightly more insects than the last survey was northeastern Argentina.
South American crop consultant Dr. Michael Cordonnier says scientists ae cautiously optimistic the 2024-25 growing season won’t be a repeat of last year, which saw the worst outbreak of the insect in generations.
Fear of another outbreak was one reason why farmers in Argentina decided to reduce their 2024-25 corn acreage. The Rosario Grain Exchange reported last week that farmers in the core production areas had reduced the corn acreage during the first phase of planting by approximately 30% due to dry conditions. Farmers are concerned about corn leafhoppers and they are unlikely to be willing to increase their late-planted corn acreage.
Brazilian farmers seek to boycott Danone... Brazilian soybean producers said there are reasons for farmers in the country to boycott Danone after the French dairy giant said it had stopped sourcing soy from Brazil. Danone’s finance chief told Reuters last week the company started buying soybeans from countries in Asia, ahead of a European Union rule requiring companies to prove they are not sourcing from deforested land.
Aprosoja Brasil, a group representing Brazilian farmers, said Danone’s move showed a “lack of knowledge” of Brazil’s production process and was a “discrimination against the country. There is no doubt that Brazilian producers, tired of being unfairly singled out as villains, will start to have more than enough reasons to put Danone and other global brands on the list of companies to be boycotted in Brazil,” the group added.
Brazil’s agriculture ministry in a separate statement listed the country’s environmental efforts and called the EU legislation “arbitrary, unilateral and punitive,” while also criticizing companies. “Brazil is ready to cooperate but demands to be treated with the fairness and balance that guide international trade. Untimely and unreasonable stances as announced by European companies with a strong presence in the Brazilian market must be rejected.”
U.S. consumer confidence rises the most since early 2021... The Conference Board said on Tuesday its consumer confidence index rose to 108.7 this month from an upwardly revised reading of 99.2 in September, fueled by optimism about the broader economy and the labor market. That was the largest monthly gain in the index since March 2021. A measure of expectations for the next six months rose in October to 89.1, the highest since December 2021. A gauge of present conditions increased more than 14 points, the largest monthly advance since May 2021.
The share of consumers that said jobs were currently plentiful rose 3.8 percentage points, the most since June 2021, to 35.1%. The share saying jobs were hard to get decreased to 16.8%. The difference between these two — a metric closely followed by economists to gauge the job market — widened for the first time since January.
The share of consumers who expect business conditions to improve increased to 21%, the largest since February 2022. At the same time, consumers’ assessments of their income prospects were unchanged from a month earlier.