Preliminary NAFTA Deal Offers Mixed Market Results
On Monday, the White House announced a preliminary deal between Mexico and the United States. The bigger changes that were made included a requirement that 75% of parts of any car sold in North America be produced in the United States, Mexico, or Canada.
Labor standards were visited as 40% to 45% of auto parts in cars sold must be by worker’s earning at least $16 per hour. The Sunset Clause, which was pushed by the U.S., was also included and states that this agreement will last 16 years with a review scheduled every 6 years.
Despite very little released on dairy, milk prices were supported from the start of the day. September through November 2918 added 10 cents each while December was up 8 cents. The 4thquarter 2018 average now stands at $16.39 per cwt.
Class III 2019 prices ranged anywhere from even to 8 cents higher. Class IV milk markets gained 3-7 cents September through December. CME spot product markets had butter 3 and ½ cents higher at $2.29 and ½ cents following 6 trades and 2 bids. Cheddar barrels moved a penny higher to $1.61 per lb. with 4 loads moving. Blocks also traded 4 times but declined 1 and ¾ cents to $1.65 and ¼ cents. Both Grade A nonfat dry milk and dry whey settled unchanged Monday. Nonfat dry milk closed at 87 cents and dry whey at 48 cents per lb.
The livestock sector reacted favorably to the trade agreement as the live cattle jumped 2 and ½ cents per lb., feeders were up 3 cents and lean hogs closed limit up and have expanded limits for Tuesday’s trading session.