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The resignation of Nvidia CEO Jensen Huang dominated the financial news headlines Thursday as investors assess the outlook for the artificial-intelligence trade following the exit of the man who largely became the face of the AI rally. The Nvidia imbroglio also has indirect but significant implications for ag commodities because it complicates U.S.-China trade relations just ahead of next week’s expected meeting between President Donald Trump and Chinese leader Xi Jinping at the Asia Pacific Economic Cooperation summit in Shenzhen. Huang was brought down in part by the revelation of an affair with a woman alleged to be a Chinese spy. China hawks are calling for tighter restrictions on exports of high-end chips crucial to the development of AI. Democratic and Republican lawmakers have called for an investigation into decisions on chip exports and policies involving Huang, who directly lobbied President Donald Trump to allow Nvidia to ship chips directly to China.
Hours before Huang’s resignation, China warned the U.S. against using spying allegations as pretext for tighter export curbs. “The U.S. should stop fabricating so-called espionage narratives to find excuses for imposing a technological blockade,” a Chinese foreign ministry spokesperson told reporters in Beijing, the Financial Times reported. She said China’s technological progress is reliant on “independent innovation and cooperation” and that Beijing has remained willing to build strategic stability with the U.S.
Trump and Xi in September extended a trade truce reached in South Korea last year until January. The truce’s renewal hinges on the U.S. pausing new restrictions on tech shipments to China, Bloomberg noted.
Meanwhile, U.S.-China trade tensions had already appeared to be on the rise, largely over flows of rare earth minerals. Treasury Secretary Scott Bessent and U.S. Trade Representative Jamieson Greer last week told China’s vice premier that Beijing needed to “immediately” meet its commitments, including agricultural purchases, under the agreement reached in South Korea last year.
- China’s commerce ministry said last week that Beijing was open to buying more U.S. farm goods, but only on the condition that the two sides implement their agreed "$30 billion for $30 billion” reciprocal tariff-reduction arrangement. The ministry on Thursday said it hoped the United States would work with China to ensure that the tariff reduction arrangement comes into effect as soon as possible, creating more favorable conditions for agricultural trade, Reuters reported.
Market recap: A strong dollar and a lack of fresh export news kept pressure on grain and soy complex markets Thursday. Cattle were mixed, while lean hogs saw renewed pressure.
- January soybeans fell 11 ¾ cents to $12.19.
- December soybean meal fell $4.30 to $325.40.
- December soybean oil fell 46 points to 63.42 cents.
- December corn fell 5 ½ cents to end at $4.42 ½.
- December soft red winter wheat fell 15 1/4 cents to $5.84 1/4, while December hard red winter wheat lost 17 1/4 cents to $6.22 ¼ – both classes hit eight-month lows. December spring wheat futures fell 12 3/4 cents to $6.22 3/4, near the daily low.
- December cotton futures finished 15 points higher at 78.67 cents.
- December live cattle fell $0.075 to $218.90, near mid-range. January feeder cattle gained $3.875 to $331.675.
- December lean hog futures fell $0.875 to $55.15.
Crude bounces, dollar rises… The ICE U.S. Dollar Index, a measure of the currency against a basket of six major rivals, rose to a 19-month high Thursday, continuing a rally reinvigorated earlier this week by a hot inflation reading. Thursday’s gains came as oil futures bounced higher following remarks by President Donald Trump, who said the U.S. didn’t need a deal with Iran and directed Vice President JD Vance, who has taken a lead role in talks, to instead work on investigating U.S. cities run by Democrats. Brent crude for January delivery rose 3.3% to $95.82 a barrel, and West Texas Intermediate for December gained 2.6% to $88.74 a barrel. A hotter-than-expected October CPI reading on Tuesday indicated sharply higher energy prices as a result of the Iran war were being passed through to the rest of the economy, serving to further cement expectations for a December rate hike by the Federal Reserve followed by further tightening. The October Producer Price Index due Friday morning will provide further clues to inflationary pressures in the pipeline.
- While the ICE U.S. Dollar Index presses higher, grain and soy complex futures are also influenced by continued weakness in the Brazilian real, which has weakened beyond the level seen after President Luiz Inácio Lula da Silva’s surprise re-election victory last month. Brazilian crops are priced in dollars on the world market. As a result, a stronger dollar means producers pocket more reais when they market their crop, an incentive for selling that can weigh on local prices and make Brazil more competitive relative to the U.S. on the world market. The real traded at more than 5.64 reais to the dollar Thursday, its weakest in 17 months, according to Barchart data.
El Niño strengthens… The U.S. Climate Prediction Center on Thursday said the “super” El Niño affecting global weather patterns continues to strengthen. “Chances for a historic event exceeding previous El Niños dating back to 1950 are now around 60% for the October-December and November-January periods, remaining at better than even odds,” the Climate Prediction Center said in an update, down from an October estimate of 83% for October-December and 70% for November-January. NOAA ranks El Niño or La Niña events on three-month average scales. “Even with a very strong El Niño, the chances of experiencing impacts consistent with El Niño are higher, though not guaranteed. In summary, El Niño continues to strengthen, with a strong-to-very strong El Niño likely through January-March 2027 (remaining greater than a 79% chance).” Bloomberg noted that the 1982-83 event was the most severe in records dating back to 1950, based on a rolling three-month average of ocean-temperature readings.
‘Resisting’ oil, gas development… An Alberta landowner advocacy organization is urging farmers and ranchers to “actively resist” new oil and gas development on their land, Reuters reports, calling it an unprecedented move highlighting growing tensions between industry and rural residents in Canada’s main energy-producing province. According to the report, the Alberta Surface Rights Federation, in a letter sent to Premier Danielle Smith on Thursday, said landowners must push back against energy development given what it calls the government’s failure to deal with issues like orphan and abandoned wells, delayed reclamation of oil and gas sites, and unpaid municipal taxes owed by oil and gas companies.