This article is based on an April 7 report by CoBank's Knowledge Exchange.
The U.S. dollar significantly weakened last week because of the tariff announcements, which typically would be supportive for grain and oilseed prices. However, the diminished world economic outlook and risk of retaliatory tariffs dampens the export outlook and was negative on grain, oilseed and cotton prices. Soymeal and soyoil prices improved on prospects of reduced imports of competing products like tallow and used cooking oil flowing into the U.S.
CoBank's Take:The weakening of the dollar acts as somewhat of a ballast against tariffs by making U.S. exports cheaper abroad. However, the larger concern of a world economy suffering from a slowdown in global commerce overhangs the markets, in addition to retaliatory tariffs that make on U.S. exports less competitive into key markets like China. A weaker U.S. dollar may not provide the bullish support to commodities that is has in the past. -Tanner Ehmke