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blame Trump?
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JD70
Posted 3/15/2019 09:45 (#7381915 - in reply to #7381653)
Subject: What seems to be lost


On the trumpets is one simple but very important fact .

It's called market disparities because of the very nature of tariffs the prices received by the parties in the trade are distorted, thus when oversupply should be telling market participants to not increase production PRICE distortion is telling one of the parties we will take all you got.

Example last year the price of Beans in the US after trump trade war got going was telling US producers to cut production but because SA producers were receiving $ 2.50 bu. bushel more they were in full expansion mode and were again this year . These added dollars pushed more expansion and once acres are added they do not go away unless the government pays them to go away.

Short answer is there is over production but the trade war distorted markets so one side did not get signal to stop expansion.

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