BEIJING- The Chicago Board of Trade (CBOT) saw declines in grain and soybean futures on Thursday as concerns grew that the new US tariffs could trigger retaliatory actions against US farm products, with over 40 percent of US soybean production sold abroad.
The most-active soybean contract on the CBOT fell 1.17 percent to $10.18 a bushel, marking the biggest daily drop in a month.
Wheat extended losses for a second consecutive session, dropping 1.48 percent to $5.31 a bushel, while corn lost 1.15 percent to $4.53 a bushel.
On Wednesday, US President Donald Trump announced a 10 percent baseline tariff on most imports to the US with higher duties on dozens of countries, kicking into high gear a global trade war.
However, top trading partners of the US Mexico and Canada, avoided fresh tariffs, although previous duties remain.
“Most of the tariffs have turned out to be more of a fizzle than a bang. What was initially proposed as a blanket 20 percent tariff has been reduced to just 10 percent, which is manageable for most nations,” said Ole Houe of IKON Commodities in Sydney.
With Asia being a major market for US grain, retaliatory tariffs – particularly from China – could make it more difficult for the US to sell its products there, Houe added.
