The partial US government shutdown is keeping commodity traders in the dark about US agricultural exports to China and other trade partners. This is because the US Department of Agriculture, which provides weekly and daily reports on farm exports, is unstaffed due to the shutdown. Without this trade data, traders cannot determine if China is making good on promises to buy more US grains and soy amid the trade war. The lack of transparency also benefits large grain merchants who have private data on export deals. The shutdown also risks delaying aid to US farmers and important USDA crop reports relied on by markets.

1. 12/30/2018 Is China buying US soy? Washington shutdown keeps traders guessing - The Economic Times
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BY REUTERS | DEC 29, 2018, 12.20 PM IST Post a Comment
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Is China buying US soy? Washington shutdown keeps
traders guessing
CHICAGO: Commodity traders are in the dark because of the partial US government
shutdown, unable to see daily and weekly reports of agricultural exports to obtain clues as
to whether China is following through with promises to buy grain and soy amid the
ongoing trade war.
Traders have been anxiously awaiting proof from the US Department of Agriculture that
China is ramping up purchases of grains and soy from US farmers, who are preparing their spring planting and trying to secure financing
for seeds, fertiliser and land rents.
Now, trade experts and grain analysts warn the suspension of the reports is clouding the marketplace and potentially giving an
advantage to big grain companies directly involved in the export trade. The government shut down partially at midnight on Dec. 21.
"We're watching sales to China like a hawk," said Ted Seifried, vice president and chief ag market strategist for the Zaner Group.
Beijing resumed buying US cargoes earlier this month, after the two countries agreed on Dec. 1 to a trade war truce. But hefty tariffs on
US cargoes remain in place, and there is uncertainty over how much the top US soybean customer will purchase.
The gap also gives the large commercial grain merchants - such as Archer Daniels Midland Co , Bunge Ltd , Cargill Inc and Louis
Dreyfus Corp [LOUDR.UL] - an advantage by allowing them to keep their export deals with countries like China and Mexico out of the
public marketplace.
ADM and Cargill said on Friday they had no comment. The other two companies could not immediately be reached for comment.
Rich Feltes, vice president for research with Chicago-based brokerage R.J. O'Brien, said the absence of USDA export sales data can
increase the risk involved in trading agricultural markets, pushing speculators to the side.
"It gives a little bit of unfair advantage to exporters who either are or are not making sales, and can trade that information accordingly,"
he said.
Along with its weekly export sales reports, the USDA has issued daily announcements of grain and soybean sales over 100,000 tonnes
since 1977. The reporting system was launched in response to the purchase of millions of tonnes of US grain by the Soviet Union in
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2. 12/30/2018 Is China buying US soy? Washington shutdown keeps traders guessing - The Economic Times
https://economictimes.indiatimes.com/markets/commodities/news/is-china-buying-us-soy-washington-shutdown-keeps-traders-guessing/printarticl… 2/3
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1972 in deals that resulted in soaring US grain and food prices
FARMERS AT RISK
University of Illinois agricultural economist Scott Irwin said the partial shutdown could also deal a blow to farmers suffering from the US-
China dispute, by delaying aid payments meant to help offset some of the losses for crops hit by retaliatory Chinese tariffs in a trade war
launched by US President Donald Trump.
"If you're talking about cash in the farmer's pocket, the longer this goes on, the longer it's going to delay that program, which is really just
getting ramped up," Irwin said.
The shutdown entered its seventh day on Friday, and was on track to continue into next week and possibly longer. It affects about
800,000 employees of the Departments of Homeland Security, Justice, Agriculture, Commerce, and other agencies.
If the shutdown persists, it also could jeopardise the release of a host of hotly anticipated monthly and quarterly grain supply and
demand reports.
The USDA on Friday reiterated that the shutdown, if it continues, would halt its World Agricultural Supply and Demand Estimates
(WASDE) report and reports by its National Agricultural Statistics Service, which tracks quarterly US grain stocks and US winter wheat
seedings.
Those reports, along with an annual summary of US crop production, were scheduled for release on Jan. 11.
In the reports, Feltes said analysts expected to see the USDA trim its estimates of the average 2018 US corn and soybean yields, imply
strong feed usage of corn in the first quarter, and shed light on how many acres of winter wheat farmers were able to plant this past
autumn, given excessive rains in many areas.
"Those are all bullish influences that we are going to be denied confirmation of," he said.
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3. 12/30/2018 Is China buying US soy? Washington shutdown keeps traders guessing - The Economic Times
https://economictimes.indiatimes.com/markets/commodities/news/is-china-buying-us-soy-washington-shutdown-keeps-traders-guessing/printarticl… 3/3
Copyright © 2018 Bennett, Coleman & Co. Ltd. All rights reserved. For reprint rights: Times Syndication Service