Basting: Trump’s Tariff Tactics Creating ‘Volatility’ in the Commodity Markets
April 2nd is the day that President Trump says he’s imposing a number of new tariffs across the board on our major trading partners. However, neither Trump nor his administration have given specific details on those new tariffs.
“It could be volatile. That may be stating the obvious,” says Brian Basting, Commodity Research Analyst and Economist with Advance Trading. He says the on-again, off-again tariff talk from President Trump is creating a whiplash effect in the commodity markets.
“Anytime you’re talking about the volume of trade—particularly in agriculture that’s involved with some of these key partners, whether it be Mexico, Canada, or China—it all adds up,” says Basting. “The market is heading into these deadlines as such with a bearish stance, so maybe some of it’s baked into the market. We don’t know at this point, but it definitely is another ingredient and the recipe for price volatility.”
Basting offers this advice ahead of President Trump’s new batch of tariffs.
“Think about price volatility as opportunity in the markets rather than with fear, because if your position your marketing strategy correctly where you can be rooting for higher prices but have downside protection, volatility can work in your favor. But, volatility can be decimating to a balance sheet if you’re not defending your balance sheet properly,” according to Basting.
Among the reported tariffs planned for this week include a 25-percent tariff on passenger vehicles, light trucks, and auto parts manufactured outside of the U.S.
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