Hassett Predicts Breakthrough in Shutdown Talks This Week
Trump to host Senate Republicans for Rose Garden lunch Tuesday | U.S./China update
Link: Trump Suggests U.S. Could Buy Argentine Beef to Lower Prices
Link: Day 20 of Gov’t Shutdown — Where’s Trump? (Week Ahead)
Link: Video: Wiesemeyer’s Perspectives, Oct. 17
Link: Audio: Wiesemeyer’s Perspectives, Oct. 17
Today’s Updates:
WHITE HOUSE & POLITICS
— Trump to host Senate Republicans for Rose Garden lunch Tuesday
— Hassett predicts breakthrough in shutdown talks this week
— Trump lists top demands on China before trade talks resume
— China replaces key WTO and UN negotiator Li Chenggang amid U.S. tensions
— China’s Fourth Plenum: Xi to cement “security-first” economic and ag strategy
— Israel resumes aid deliveries to Gaza after deadly strikes
— Trump denies urging Zelenskyy to cede Donbas, calls for freeze
along current battle lines
FINANCIAL MARKETS
— Equities today: global markets rise as earnings season begins
— Fed blackout period ahead of Oct. 28–29 FOMC meeting
— Gold nears $4,300 as investors flock to safe havens
AG MARKETS
— Cattle prices plunge after Trump’s beef comments
— China imports no U.S. soybeans in September for first time since 2018
— France bans cattle exports and bullfighting as lumpy skin virus spreads
FARM POLICY
— Thune’s push to open FSA marketing assistance loan access faces some farmer frustrations amid shutdown
NEW WORLD SCREWWORM
— USDA reports no new screwworm cases along border as monitoring intensifies
ENERGY MARKETS & POLICY
— Oil prices dip on global glut worries and U.S./China trade tensions
TRADE POLICY
— Trump admin. to impose 25% tariffs on heavy trucks, expand parts relief program
— China poised for trade showdown with Trump
CHINA
— China says growth target still in reach despite weakest expansion in a year
TRANSPORTATION & LOGISTICS
— China/U.S. shipping rates surge 32% as exporters race to beat potential Trump tariffs
WEATHER
— NWS outlook: rain and gusty winds for the Northeast; warmth persists across southern Plains
Updates: Policy/News/Markets, Oct. 20, 2025
—Trump to host Senate Republicans for Rose Garden lunch TuesdayPresident plans “thank-you” event amid government shutdown, nominations push President Donald Trump will host Senate Republicans for a lunch Tuesday in the White House Rose Garden, according to a report by Punchbowl News. The gathering, described as a “thank-you” to GOP senators, is meant to recognize their unity during the ongoing government shutdown and their work in clearing a backlog of presidential nominations. The lunch underscores the White House’s effort to reward party discipline as the shutdown enters its third week, and key spending bills remain stalled in Congress. A Punchbowl post on X framed the event as both a gesture of appreciation and a signal of continued coordination between the president and Republican senators. The Senate recently approved more than 100 Trump administration nominees in a single session after procedural changes were made to expedite the process — a move the White House viewed as critical to keeping the administration fully staffed during the standoff. The Rose Garden setting highlights the administration’s focus on optics and unity amid mounting public frustration over the funding impasse. The lunch is expected to feature remarks from Trump thanking senators for “staying the course” and emphasizing the need to remain aligned as negotiations over spending and policy priorities continue. While the event is being billed as informal, Trump often uses such gatherings to preview upcoming policy moves or signal priorities ahead of new legislative battles. The guest list has not yet been released, but aides say attendance from the full Republican conference is expected. The meeting comes as the White House and congressional leaders continue to spar over government funding and as Trump presses for faster confirmation of key nominees across federal agencies. —Hassett predicts breakthrough in shutdown talks this weekWhite House economic chief hints at possible tougher measures if Senate stalemate persists National Economic Council Director Kevin Hassett said Monday he believes the federal government shutdown could end later this week, signaling optimism that negotiations are gaining traction. Speaking on CNBC, Hassett said the “ball is in the Senate’s court” to reach a resolution, but warned that if lawmakers fail to act, the White House may consider stronger measures to compel Democrats to return to the negotiating table. “We’re hopeful, but we’re also prepared,” Hassett said, noting that President Trump’s team remains focused on minimizing economic fallout. His comments suggest that the administration may be exploring executive or procedural steps to increase pressure as the shutdown continues into its fourth week. Of note: Some Democrats think that they stand to gain politically when ObamaCare premiums rise significantly because of the GOP failure to negotiate, even though Democrats can claim they tried for weeks. About a dozen states so far have published ACA/ObamaCare health insurance prices for 2026, showing many premiums skyrocketing absent action by Congress. By the end of next week, dozens more states will reveal pricing for next year. Regarding U.S./China developments, “Our expectation is that Secretary Bessent is going to land this plane,” in regard to trade negotiations with China, Hassett told CNBC. Bessent has meetings this week that he thinks “will help clear up some misunderstandings,” Hassett added. —Trump lists top demands on China before trade talks resumePresident targets rare earths, fentanyl, and soybeans as key sticking points ahead of Malaysia negotiations President Donald Trump said Sunday that the United States will press China on three core issues — rare earths, fentanyl, and soybeans — before trade talks resume later this week in Malaysia, as a fragile truce between the two countries nears its Nov. 10 expiration. “I don’t want them to play the rare earth game with us,” Trump told reporters aboard Air Force One, referring to Beijing’s recent decision to tighten export controls on critical minerals. He also called on China to halt fentanyl exports that fuel the U.S. opioid crisis and to resume large-scale purchases of American soybeans, which have dropped to zero this year. Treasury Secretary Scott Bessent confirmed the upcoming talks following his virtual meeting with Chinese Vice Premier He Lifeng, which Chinese state media described as “constructive.” The talks come amid escalating tensions. Trump has threatened a 100% tariff on Chinese imports starting Nov. 1 and warned that his planned sit-down with Chinese President Xi Jinping — expected at the APEC summit in South Korea — could be scrapped. The moves threaten to unravel months of tentative stability in the trade relationship, strained further by U.S. tech restrictions and Chinese export curbs. Soybeans remain a flashpoint, with U.S. farmers — many facing low prices, high input costs and overflowing storage — awaiting Washington’s delayed aid amid the government shutdown. “We have to have a fair deal,” Trump said, emphasizing his expectation that Beijing return to buying U.S. crops. The fentanyl dispute also remains a thorn in the relationship. Trump has tied new tariffs, including a 20% blanket levy on Chinese goods, to Beijing’s failure to stem chemical exports. Chinese officials counter that both sides must act “on the basis of equality, respect, and mutual benefit.” Analysts see Trump’s priorities as politically strategic. These are issues that resonate with powerful domestic constituencies and signal the president aims for quick, visible wins rather than drawn-out structural reforms. —China replaces key WTO and UN negotiator Li Chenggang amid U.S. tensionsXi Jinping’s reshuffle comes just days after U.S. Treasury Secretary Bessent’s sharp rebuke of the veteran trade envoy Chinese President Xi Jinping has removed Li Chenggang, Beijing’s top trade negotiator, from his positions at the World Trade Organization and the United Nations, Nikkei Asia reports. The personnel change, announced Monday, comes just days after U.S. Treasury Secretary Scott Bessent criticized Li for what he called “disrespectful” conduct during recent trade talks — raising questions about the timing as the U.S. and China prepare for another round of negotiations in Malaysia. Li Yongjie, formerly director-general of the WTO legal division within China’s Ministry of Commerce, will replace Li Chenggang as China’s permanent representative to the WTO and deputy permanent representative to the UN, according to state broadcaster CCTV. Li Chenggang, however, remains listed on the ministry’s website as China’s trade representative with ministerial rank, suggesting his broader role in trade negotiations may continue for now. Singtao, a Hong Kong newspaper, had reported in July that Li Yongjie was expected to take over the WTO post, implying Monday’s announcement was largely procedural. Zichen Wang, a research fellow at the Center for China and Globalization, told Nikkei Asia the move was “nothing unusual,” noting that ambassador-level rotations typically await formal presidential approval. Still, the reshuffle lands amid heightened tensions between Washington and Beijing. Bessent recently claimed that Li Chenggang threatened to “unleash chaos on the global system” if the U.S. proceeded with new shipping fees on Chinese vessels. Both sides imposed reciprocal shipping charges last week, coinciding with Beijing’s rollout of sweeping export controls on rare earths and related technologies. A video call between Vice Premier He Lifeng, Bessent, and U.S. Trade Representative Jamieson Greer took place on Saturday, with further talks expected in Malaysia this week. A potential face-to-face summit between President Donald Trump and Xi Jinping could follow in South Korea later this month. Xi’s Monday announcement also included new ambassadorial appointments to Romania, Ecuador, and Malta — part of what observers described as a broader diplomatic reshuffle amid escalating trade and geopolitical frictions.—China’s Fourth Plenum: Xi to cement “security-first” economic and agricultural strategyBeijing’s top policy meeting will shape China’s next five years as growth slows, food security rises in priority, and U.S. tensions deepen China’s top leadership gathers this week for the Communist Party’s pivotal “Fourth Plenum,” a four-day meeting expected to lock in the country’s economic, technological, and agricultural direction through 2030. The session comes amid flaring trade tensions with the United States, persistent deflationary pressures, and sluggish domestic spending — even as Chinese equities have staged a sharp rebound. At the heart of the meeting will be President Xi Jinping’s drive for self-reliance, not only in high-tech manufacturing but also in food and agriculture. Analysts expect Xi to double down on state-led innovation and “food security as national security,” reinforcing the Party’s long-standing pledge to “hold China’s rice bowl firmly in its own hands.” “For foreign businesses and governments, the signal is blunt,” a contributor wrote for the Lowy Institute. “Xi is staying the course on industrial and agricultural self-reliance, even if it causes overcapacity and strains global trade ties.” Agriculture and food security take center stage. While the plenum’s headline focus is on high-tech industry, agriculture is emerging as a central pillar of Xi’s security-first economic model. The upcoming 15th Five-Year Plan (2026–2030) is expected to emphasize food security, farmland protection, and modernization of the rural economy — all framed as strategic imperatives rather than growth goals. Beijing is expected to reaffirm its target of over 770 million tonnes of annual grain output, while expanding acreage for oilseeds and high-protein crops to reduce import dependence. New measures are likely to strengthen the “red line” on arable land, protect farmland from conversion, and incentivize biotechnology and digital farming. According to Reuters, China’s government has already boosted its 2025 grain stockpiling budget and launched a smart-farming plan (2024–2028) using big data, AI, and GPS to modernize rural production. These initiatives reflect Beijing’s effort to close the gap between agricultural supply and growing domestic demand, particularly for soybeans, corn, and edible oils. Technology meets agriculture. Agriculture is now part of the same modernization agenda driving China’s industrial strategy. The smart farming initiative, announced last October, aims to digitize farming operations nationwide, promote “digital villages,” and encourage local governments to pilot precision agriculture. The Food Security Law, which came into effect in May 2024, enshrines the principle of “basic self-sufficiency in cereal grains and absolute self-sufficiency in staple grains,” anchoring agriculture as a core component of Xi’s broader self-reliance doctrine. Beijing also plans to accelerate development of GM seed technology and hybrid crop breeding as part of its “new quality productive forces” — a phrase that, while used for semiconductors and EVs, increasingly includes agri-biotech. Global implications. China’s agricultural self-reliance push could reshape global commodity markets. Analysts warn that if Beijing achieves its production goals for grains and oilseeds, imports from major exporters like the U.S., Brazil, and Argentina could decline, potentially depressing global soybean and corn demand while increasing competition for higher-value agricultural exports. At the same time, Beijing’s state-led investment in agri-tech could spur new opportunities for foreign firms in biotechnology, smart equipment, and precision-farming tools — but under tighter regulatory scrutiny. Bottom Line:With Xi’s policy direction now emphasizing security over growth, China’s Fourth Plenum is set to enshrine a model of self-sufficient development — from silicon chips to soybean fields — that will reverberate across global markets for years to come. —Israel resumes aid deliveries to Gaza after deadly strikesBoth sides reaffirm commitment to fragile ceasefire despite mutual accusations Israel said it would resume humanitarian aid deliveries to Gaza and return to observing the ceasefire in the territory, following a day of intense violence that killed 26 people. Earlier, Israel suspended aid and launched air strikes after accusing Hamas of firing on its troops and killing two soldiers. Hamas and Israel have traded accusations of violating the truce since it began on Oct. 10, yet both maintain they want the ceasefire to continue despite escalating tensions. —Trump denies urging Zelenskyy to cede Donbas, calls for freeze along current battle linesPresident says Ukraine should “stop at the lines where they are” as reports surface of a tense White House meeting with Zelenskyy President Donald Trump on Sunday denied telling Ukrainian President Volodymyr Zelenskyy to surrender the entire Donbas region to Russia but said Kyiv should accept a cease-fire along existing front lines. “We never discussed that,” Trump told reporters, rejecting reports that his private White House meeting with Zelensky last week devolved into a “shouting match.” Trump said Ukraine should “stop at the lines where they are,” arguing that continued fighting only leads to more casualties. “Go home, stop killing people and be done,” he said. The president added that about “78% of the land is already taken by Russia” and that the remainder could be negotiated “later on down the line.” The Financial Times previously reported that Trump had urged Zelensky to relinquish large portions of eastern Ukraine and dismissed battlefield maps during their three-hour meeting. Sources also said Trump declined to provide Ukraine with Tomahawk missiles, warning, “If [Putin] wants it, he will destroy you.” The tense meeting followed a phone call between Trump and Russian President Vladimir Putin and comes ahead of a planned Trump-Putin meeting in Budapest. Despite recent friction with Moscow, Trump reiterated his belief that freezing the conflict at current positions is the best way to “stop the killing.” |
| FINANCIAL MARKETS |
—Equities today: U.S. equity futures climbed as investors brushed aside concerns over trade tensions and credit risks to refocus on the upcoming wave of corporate earnings. In Asia, Japan’s Nikkei 225 hit a new record high after the ruling party secured a coalition agreement positioning pro-stimulus lawmaker Sanae Takaichi to become the next prime minister. The yen firmed and Japanese bonds held steady. The Nikkei stock benchmark is now up 23% for the year to date. French government bonds fell after S&P Global Ratings downgraded the nation’s sovereign credit score, an unscheduled move that highlights the nation’s fiscal woes and places its debt at risk of forced selling by some funds. In Asia, Japan +3.4%. Hong Kong +2.4%. China +0.6%. India +0.5%. In Europe, at midday, London +0.3%. Paris -0.1%. Frankfurt +1.1%.
—The blackout period ahead of the Oct. 28-29 Federal Open Market Committee (FOMC) meeting started Saturday (Oct. 18). There are several Fed officials on the schedule to deliver remarks this week with some of them being opening or closing remarks for a Fed conference or congressional testimony. With the blackout period in effect, that means officials will not be commenting on the economy or monetary policy in those appearances. “During each blackout period, participants refrain from expressing their views about macroeconomic developments or monetary policy issues in meetings or conversations with members of the public,” according to Fed policies covering external communications by Fed officials.
—Gold nears $4,300 as investors flock to safe havens
Shutdown turmoil, trade tensions, and credit jitters drive sharp gains in metals
Gold and silver surged another 5.76% and 6.55%, respectively, last week as investors sought safety amid mounting uncertainty over the government shutdown, escalating global trade tensions, and fresh concerns in the banking and credit sectors. Gold briefly approached $4,300 per ounce for the first time late in the week before easing into the weekend, while silver saw a sharp 5% pullback on Friday. Despite the dip, analysts say the broader uptrend for both metals remains firmly intact, with the path of least resistance still pointing higher.
| AG MARKETS |
—Cattle prices plunge after Trump’s beef comments
Roger A. McEowen: Market panic highlights fragile confidence and packer dominance in U.S. beef sector
Cattle markets tumbled sharply on Oct. 17, 2025, following President Donald Trump’s surprise statement that his administration was “working on a deal to bring beef prices down.” According to agricultural law professor Roger A. McEowen (link), automated trading systems reacted instantly to the ambiguous remark, interpreting any potential government intervention as a bearish signal for the market.
Feeder cattle futures — already at record highs amid multi-decade low herd inventories — fell to their daily limit as traders unwound long positions. “A market already running hot due to record-low cattle inventories experienced a shock of potential government intervention,” McEowen wrote, noting that panic selling swept through contracts across the board.
At the farm level, McEowen said the drop immediately strained ranchers’ hedge accounts and could delay herd rebuilding. “The limit-down move signals a much lower expected price for calves and yearlings in the months ahead,” he explained. Producers may now choose to sell breeding heifers rather than retain them, a move that could prolong tight supplies and sustain high retail beef prices.
Despite the futures collapse, cash trade held firm during the week, with fed cattle prices still $5–$9 higher than the prior week. McEowen cautioned, however, that the sharp futures decline will pressure cash markets in coming weeks as packers use the bearish sentiment to negotiate lower bids.
He also highlighted the weak correlation between cattle prices and what consumers pay at the store. Four major packers control more than 80% of U.S. beef processing, and their ability to manage boxed beef margins means retail prices rarely move in step with live cattle values. “Hopefully the ‘magic’ the President is referring to includes addressing meatpacker market power,” McEowen concluded.
—China imports no U.S. soybeans in September for first time since 2018
Brazil and Argentina dominate market as tariff dispute squeezes U.S. farmers
China imported no soybeans from the United States in September — the first time since 2018 — underscoring how deeply the ongoing U.S./China trade dispute has disrupted agricultural flows. Customs data showed U.S. shipments dropped from 1.7 million metric tons a year ago to zero, while total Chinese soybean imports surged to 12.87 million tons, the second highest on record.
Analysts said the halt reflected tariff burdens and exhausted old-crop U.S. supplies, as Chinese buyers pivoted almost entirely to South America. Imports from Brazil rose nearly 30% year-on-year to 10.96 million tons, commanding 85.2% of China’s market, while Argentina’s shipments jumped 91.5% to 1.17 million tons.
The shift leaves U.S. exporters sidelined just as their harvest season peaks. No new U.S. soybean cargoes have been booked from this autumn’s crop, and the purchase window is closing fast, with Chinese crushers locking in Brazilian and Argentine supplies through November — aided by Argentina’s temporary export tax holiday.
Beijing’s heavy reliance on South American beans could still create a supply gap early next year, analysts warn, if a trade deal is not reached before Brazil’s new harvest arrives. “A soybean supply gap may emerge between February and April,” said Johnny Xiang, founder of AgRadar Consulting, according to Reuters. “Brazil has already shipped a huge volume, and no one knows how much old-crop stock remains.”
Despite the September freeze, China’s year-to-date U.S. soybean imports are up 15.5% to 16.8 million tons, reflecting earlier purchases made before tariffs escalated.
Trade talks appear to be regaining momentum, with President Donald Trump saying Sunday he believes a soybean deal is within reach — though time is running short for U.S. farmers counting on export relief.
—France bans cattle exports and bullfighting as lumpy skin virus spreads
Government imposes emergency curbs as first major outbreak hits French farms
France has imposed a sweeping ban on cattle exports and events involving livestock, including bullfighting, as authorities race to contain the spread of lumpy skin disease — a highly contagious virus infecting the country’s herds for the first time, Reuters reported.
The French agriculture ministry said Friday that the measures will take effect on Oct. 18 and remain in place until Nov. 4, with the possibility of lifting them if conditions improve. Lumpy skin disease, spread by insects, affects cattle and buffalo, causing painful blisters and reduced milk production. While the virus poses no threat to humans, it frequently triggers trade restrictions and severe economic losses, according to Reuters. “The very recent emergence of several isolated outbreaks — one in Ain, three in Jura, and three in Occitanie — is a cause for concern and is probably the result of animal movements, some of which were illegal,” the ministry said.
After slowing during the summer, new outbreaks have surged this month, spreading from the Alps to the Jura and Ain regions in eastern France. Three more clusters were discovered this week near the Spanish border.
During a visit to Jura, Agriculture Minister Annie Genevard cautioned that “the future of French livestock farming is at stake.” She added, “We are at a critical moment. It is essential we keep up our efforts to protect the French cattle herd. Let’s rise to the challenge together, as we have since last June.”
The virus, long endemic in Africa and the Middle East, was absent from Western Europe until mid-2024, when outbreaks first occurred on Italy’s Sardinia Island, followed by France. Spain reported its first case last week.
Infections appeared recently in three communes in the Pyrenees-Orientales — La Bastide, Oms, and Valmanya — about 30 kilometers from the Spanish border, prompting a mandatory vaccination campaign in nearby areas. “We can imagine that there is a link with Spain, but we are still investigating,” Genevard said, according to Reuters.
The French government called the situation a critical test for its animal-health system, stressing that the swift containment of the virus is essential to protect the nation’s beef and dairy industries from longer-term disruption.
| FARM POLICY |
—Thune’s push to open FSA marketing assistance loan access faces some farmer frustrations amid shutdown
Some producers say marketing loans are slow to deliver relief — and call for immediate tariff aid payments to stabilize farm finances
Sen. John Thune’s (R-S.D.) effort to reopen Farm Service Agency (FSA) offices so producers can access marketing assistance loans may sound like a welcome step, but some farmers caution the process is far from quick. Securing these loans requires signed lien waivers from cash rent landlords — a task complicated by the sheer number of lease arrangements on most farms. For many producers unfamiliar with the grain loan system, it can prove to be a cumbersome and slow-moving process.
USDA Secretary Brooke Rollins has noted there are still “many unknowns” regarding the scale of tariff-related assistance needed for farmers. But producers argue the impact of current trade policies on crop prices and margins is already painfully clear. “It’s not an unknown how bad our crop price-margin losses are,” one farmer said, urging the administration to move faster.
Farmers are calling for the White House to announce payment rates under a new tariff aid program even before the government shutdown ends. Doing so, they argue, would give farm operations — and their increasingly anxious bankers — greater economic certainty. Announcing tariff relief now, they add, could also increase political pressure on Congress to end the shutdown and restore full federal farm services.
| NEW WORLD SCREWWORM |
—USDA reports no new screwworm cases along border as monitoring intensifies
Secretary Rollins says over 22,000 specimens tested with zero U.S. detections; 100 million sterile flies released weekly in Mexico as new Moore Air Base facility nears completion
USDA Secretary Brooke Rollins said no new cases of New World Screwworm (NWS) have been detected in the past week in Mexican states bordering the United States, marking a positive milestone in containment efforts. In a post on X, Rollins detailed that USDA recently convened a call with more than 200 stakeholders to unveil the USDA NWS Response Playbook, which outlines the agency’s current surveillance and contingency strategies should the pest cross into U.S. territory.
Rollins said USDA teams are actively monitoring 350 collection sites in NWS-affected areas of Mexico, while in the U.S. the agency is maintaining 113 NWS-specific fly traps across ten counties in three states, supplemented by 7,300 fruit fly traps. “To date, 22,210 specimens have been tested (1,756 in the past week) resulting in ZERO detections in the US,” Rollins reported.
To suppress the pest population, USDA is releasing 100 million sterile flies each week via more than 40 dispersal flights over southern Mexico. Inspectors have also examined 1,670 wild or feral animals for signs of NWS in Texas. While 7,885 cases have been confirmed in southern Mexico—a rise of 838 since October 2—there have been no detections in border states since October 5.
Rollins noted that the new Moore Air Base facility, slated to open in early 2026, will expand capacity to disperse 300 million sterile flies weekly along the U.S.-Mexico border. Her latest update, while focused on progress and prevention, notably avoided previous criticisms of Mexico’s handling of the NWS outbreak.
| ENERGY MARKETS & POLICY |
—Oil prices dipped, pressed by worries over a global glut as U.S./China trade tensions added to concerns about an economic slowdown and weaker energy demand. Brent crude futures were down 0.3% at $61.11 a barrel. West Texas Intermediate (WTI) futures fell 0.3% to $57.37.
| TRADE POLICY |
—Trump administration to impose 25% tariffs on heavy trucks, expand parts relief program
New tariffs on trucks and buses set for Nov. 1 as White House extends auto-parts rebate through 2030
The Trump administration will impose 25% tariffs on heavy trucks and truck parts and a 10% tariff on buses. The new measures, taking effect Nov. 1, exempt Mexico and Canada under the U.S.-Mexico-Canada Agreement (USMCA), though buses from those countries will still face the 10% duty. Countries with national security-related tariff pacts will receive reduced rates, officials said.
Alongside the new tariffs, the White House will expand a relief program for U.S. vehicle manufacturers, allowing those who produce cars and trucks domestically to apply for credits covering up to 3.75% of the value of their vehicles to offset tariff costs on imported parts. The revised program, effective until 2030, replaces an earlier version set to expire in 2027 with a lower 2.5% rebate cap beginning in 2026.
The expansion comes amid persistent supply-chain disruptions — from aluminum shortages to export restrictions on semiconductors and rare-earth materials — that have strained automakers already burdened by billions in tariff payments and a costly retreat from electric-vehicle production.
—China poised for trade showdown with Trump
Rare earths are far from Beijing’s only lever in a U.S/China standoff
In a recent commentary for the Financial Times, columnist Gideon Rachman argues that People’s Republic of China is unusually well positioned to hold its ground — and perhaps gain leverage — in a renewed trade confrontation with Donald Trump’s United States.
Here are some of the key take-aways:
Why China has the upper hand
• The piece notes that China enjoys structural advantages. For one, its dominance in essential raw materials — notably rare earths — gives Beijing a tangible export-control lever.
• More broadly, China has embedded itself firmly into the global supply chain for intermediate goods and critical inputs, making it difficult for the U.S. to substitute away quickly.
• The commentary also highlights that previous U.S. pressure on Chinese technology firms (such as sanctions on Huawei Technologies Co., Ltd.) did not always deliver the desired effect, and China has made progress on indigenous alternatives — narrowing U.S. options.
Not just rare earths. While the export controls on rare earths grab headlines, the article emphasizes that China’s leverage spans more than that:
• The global dependence on Chinese-manufactured intermediate goods means a “chokepoint” effect: even if the U.S. wants to retaliate or decouple, doing so quickly is costly.
• China has also diversified export markets and built resilience, so disruption to U.S. demand is less catastrophic for Beijing than it would have been decades ago.
• In short: Beijing holds both a supply-chain weapon (rare earths, intermediates) and a broader cushion (diversified markets, domestic reforms) in a showdown scenario.
U.S. vulnerabilities and risks. According to the analysis:
• The U.S. faces limitations in rapidly replacing Chinese-origin inputs, particularly in high-tech manufacturing or defense-adjacent supply chains.
• President Trump’s threat of steep tariffs — for example, up to 100 % on Chinese exports — raises the stakes and increases the risk of sharp economic spillovers.
• At the same time, China is not invulnerable. Its economy still grapples with structural issues (youth unemployment, overcapacity, reliance on exports) that mean prolonged conflict would be costly for both sides.
What this means for the trade war ahead
• The article suggests that when China and the U.S. meet — perhaps around the APEC Summit or other high-level engagements — China will be negotiating from a position of strength rather than desperation.
• The U.S. may still impose tariffs or export-control escalation, but the pathway to forcing China into major concessions is narrower than often assumed.
• Both economies could suffer in the long term from a drawn-out fight, but in the immediate term China holds more cards.
| CHINA |
— China says growth target still in reach despite weakest expansion in a year
Export surge masks deepening domestic slowdown as leaders meet to set economic agenda through 2030
China’s economy expanded 4.8% in the third quarter — its slowest pace in a year but slightly above expectations — keeping the country on track to meet its roughly 5% annual growth goal, according to the National Bureau of Statistics. Officials hailed the result as a “solid foundation” for the year’s target, though underlying data revealed growing strains at home.
Domestic demand remains fragile, with retail sales and investment both weakening. Fixed-asset investment fell 0.5% in the first nine months, the first contraction since 2020, and nominal growth slowed to just 3.7% as deflation pressures deepened.
The only bright spot was exports, which soared to record levels and now account for more than 6% of the economy — a reliance that risks intensifying trade frictions with the U.S. and Europe.
The report came as President Xi Jinping and top Communist Party officials convene in Beijing for the Fourth Plenum to map out China’s 15th Five-Year Plan through 2030. Economists expect discussions to focus on strengthening the social safety net, stabilizing the housing market, and addressing the structural imbalance between supply and demand.
At the same time, Treasury Secretary Scott Bessent and Chinese Vice Premier He Lifeng are set to meet in Malaysia this week ahead of a Trump/Xi summit, where trade, rare earths, and soybean purchases are expected to top the agenda.
Despite the weaker tone in consumption and investment, Goldman Sachs lifted its 2025 growth forecast to 4.9%, citing industrial resilience and fiscal support measures, including 1 trillion yuan ($140 billion) in new financing and bond quotas for local governments. But analysts warn the export-heavy rebound cannot mask deeper imbalances.
| TRANSPORTATION/LOGISTICS |
—China/U.S. shipping rates surge 32% as exporters race to beat potential Trump tariffs
Freight costs soar on Pacific routes as Chinese exporters rush to move goods before possible new U.S. trade barriers
Freight rates between China and the United States have jumped sharply as exporters scramble to ship goods ahead of potential new tariffs from the Trump administration, adding fresh strain to already-stretched global supply chains.
According to Caixin Global, the Shanghai Containerized Freight Index (SCFI) — a key benchmark for ocean shipping prices — climbed 12.9% week-on-week as of Oct. 17, led by a 32% surge in Pacific route rates to $1,936 per 40-foot equivalent unit (FEU). The spike reflects a rush by Chinese exporters to move cargo before new U.S. trade measures possibly take effect in the coming weeks.
Industry analysts told Caixin the rate increase is being driven by “front-loading” — a familiar pattern during past rounds of tariff escalation — as exporters expedite shipments to avoid higher costs. Freight forwarders report capacity on major routes has tightened, with spot bookings filling up rapidly through late October.
The surge underscores rising anxiety across Asia’s manufacturing hubs following President Donald Trump’s renewed threat to impose tariffs on a broad range of Chinese goods, part of his administration’s broader effort to pressure Beijing over industrial policy and trade imbalances. “Exporters are paying premiums to guarantee sailings,” one Shanghai-based logistics manager told Caixin. “Everyone wants to get their goods out before anything new is announced.”
While higher freight prices may ease if tariff measures are delayed or softened, supply-chain experts warn that persistent trade uncertainty could keep shipping rates elevated and ripple through global markets. A prolonged spike could also squeeze margins for manufacturers and importers already coping with volatile currency and commodity prices.
Economists note that such rate jumps often precede broader trade disruptions, signaling expectations of tighter cross-border flows. “This is a stress signal,” said one Beijing-based trade economist quoted by Caixin. “When the freight index moves this fast, it reflects policy risk more than actual demand.”
The latest data also show how sensitive logistics networks remain to political shocks. Just as post-pandemic trade stabilized, fears of renewed tariff escalation have prompted what one freight analyst called “a déjà vu moment from 2018” — a reminder that policy volatility can drive costs as quickly as market forces.
| WEATHER |
— NWS outlook: Low pressure system to bring locally heavy rain and gusty winds for the Northeast today… …Windy, colder, and unsettled weather to spread across the northern tier states for the next couple of days… …Unseasonable October warmth cross the southern Plains to start the week with highs climbing well into the 80s and 90s.
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