CANBERRA- Chicago wheat, corn and soybean futures fell sharply on Wednesday as early results from the US presidential election put Donald Trump in the lead, raising prospects of new trade barriers and boosting the dollar.
Trump, the Republican candidate, was drawing more support than he did in his failed 2020 campaign, though the result remained unclear in most of the battleground states that will decide the winner.
Markets did not wait. US stock futures, Treasury yields and the dollar gained sharply and most commodities lost ground.
Tariffs proposed by Trump could disrupt US agricultural trade, US farmers fear. A stronger dollar makes US farm exports costlier for overseas buyers.
“A trade war with China is now more of a possibility,” said Ole Houe, director of advisory services at IKON Commodities in Sydney.
But even if Trump wins, prices would quickly rebound, he said. “The market will initially trade the trade but claw it all back within a week… There’s plenty of demand for wheat and feed grain in the world. Soybeans are fairly priced, but wheat and corn are too cheap.”
