Miller Magazine Issue: 113 May 2019

86 MARKET ANALYSIS MAY 2019 U.S. President Donald Trump’s Twitter provides fresh White House trading strategy. They deny trade talks and the US stocks get higher while Shanghai Composite crashing. The grain market is low. Trump loves to intimidate the markets, his favorite weapon. It’s safe to say that these threats should not be taken seriously. If the States introduce new duties the rate between counties will be higher than in many count- ries. Most likely the continuation of the game ‘who will blink the first’ rather than a change in the course of negotiations. Some analysts suggest that this is a part of the President’s game with Fed and Powell not with China. Trump trying to drive the Fed into a corner. If there is uncertainty regarding trade it’s possible the regulation will have to reduce rates and ensure economic growth before elections 2020. There are doubts that this is a way to play a strategy game. It occurs in the foreign exchange market. The Chinese yuan fell amid a slowdown in the economy. And the exchange rate increases the competitiveness of the country. Another point in this si- tuation is Trump does not get tired of repeating that he needs cheap oil and the escalation of the trade conflict with China is one of the unconventional ways to achieve the goal. There are the most interesting days as The North Hemisphe- re. Planting data renews daily and the market is very sensi- tive to each updating. Rain, snow and cold weather in the USA has certainly slowed spring planting progress so far. As of May 7, average expectations was 25% for corn, 8% for soybeans, 24% for spring wheat. New USDA report shows 23% of corn, 6% of soybeans and 22% of spring wheat. This is much better than a week ago but still, less then re- gular pace, which is 46% for corn, 14% for soybeans and 49% for spring wheat. Winter wheat conditions are 64% good/excellent as per market data. Planting delays for corn/ soybeans increase the likelihood of farmers switching from corn to soybeans which have a later planting window. As per new Trump’s Twitter claim, the US is on the warpath with China and it’s not the and of the sad-soybean story. Soybean futures should fall. Anyway, China says their delegation plans to visit the USA this week to continue negotiations. EU and Black Sea Region were cold and dry, but fields in Ukraine, Romania, Moldova, Bulgaria, and Greece, I was seen last week looking good. Ukrainian crop progress going well: soybeans did for 6% of expecting 1822 thnd ha or 110 thnd ha, corn at 16.4% from 4662.4 thnd ha, spring wheat almost finished. Now weather conditions a little bit better, Europe got the bulk of the rain in the Balkans, Germany, and Poland, but temperatures remain significantly below normal. Also, there is windy and ground lost moisture. Balkan areas crop, for now, looks pretty good also. Greece, Bulgaria and Moldova are not the main producers for sure, but can’t for- get even about that. For example, Bulgaria corn production is near 2-2.6 MMT (exports 1.3 MMT), wheat is near 5-6 MMT (exports 2-2.6 MMT). Canada looks dry and cold, Turkey and part of the Middle