US corn futures hit a three-month low and soyabeans neared a three-week bottom after China said it would impose additional tariffs on US products including grains and soya, escalating the trade war between the world's top two economies. On the Chicago Board of Trade, soyabean futures posted the biggest declines. China is the world's top soyabean buyer, and the trade row has hit the market hard. But corn pared losses by midsession and wheat futures turned higher.
As of 11:46 am CDT (1646 GMT), CBOT November soyabeans were down 13-1/4 cents at $8.55-1/2 per bushel after hitting $8.55, the contract's lowest since Aug. 5. December corn was down 3-3/4 cents at $3.67-1/4 a bushel after dipping to $3.65-1/2, its lowest since May 13, while December wheat was up 2-1/4 cents at $4.74 a bushel.
All three markets fell immediately after China said announced retaliatory tariffs against about $75 billion worth of US goods, including agricultural products. But the impact on grains was seen as largely psychological, given that China already said this month it halted purchases of US agricultural products.
"China is already buying zero (US) soyabeans; I don't know if increasing the tariffs is going to change anything," said Joe Vaclavik, president of Standard Grain, a brokerage and consulting firm. The four-day Pro Farmer Midwest Crop tour wrapped up late Thursday, with scouts projecting below-average crop potential in Iowa, the top US corn state, and Minnesota, the No. 4 corn producer.
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