Grain and soyabean markets faced selling late last week amid worries about potential retaliation by countries affected by the Trump administration’s tariffs on steel and aluminium imports.

Funds were estimated net sellers of 10,500 contracts on corn, 19,000 soyabeans and 7,000 wheat contracts on Friday, according to brokers Allendale. “The concern is when there will be retaliation from China the number one buyer of US soybeans,” it said.

China is the world’s largest importer of soyabeans, accounting for almost two thirds of the export market. China was the top destination for US soyabean exports, taking almost 60 per cent of the country’s sales overseas, according to data from the International Trade Center.

The soyabean price is down 3 per cent from a week ago trading at $10.29 a bushel, despite prolonged drought in Argentina leading to the cut in this year’s output estimates.

“We have heard directly from the Chinese that US soybeans are prime targets for retaliation,” said the American Soybean Association last week, adding, “our competition in Brazil and Argentina is eager to capitalise on whatever openings these tariffs create for them in markets like China and elsewhere”.

The US Grains Council, which represents grain producers and agribusinesses that export barley, corn, sorghum as well as related products like ethanol and distillers dried grains (DDGS), said it was concerned about “retaliation in kind” from trading partners such as Mexico, Canada, South Korea, Brazil and the EU.

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