Global Growth Outlook Buoyed by AI Investment Despite Tariff Drag
Trump administration backs Bayer’s bid for Supreme Court review | USMCA hearings
Link: Video: Wiesemeyer’s Perspectives, Nov. 28
Link: Audio: Wiesemeyer’s Perspectives, Nov 28
Today’s Updates:
GLOBAL ECONOMY
— Global growth outlook buoyed by AI investment despite tariff drag
LEGAL & REGULATORY
— Trump administration backs Bayer’s bid for Supreme Court review
— Costco moves to protect itself as tariff court fight nears climax
AGRICULTURE & TRADE
— China poised to surge U.S. soybean buying despite tight deadline
— Brazil’s beef exporters brace for China’s January ruling after a record year
FINANCIAL MARKETS
— Equities today: global stocks firm ahead of possible Fed rate cut
— Equities yesterday: major U.S. indexes slip to start December
AG MARKETS
— Spain’s pork exports to China resume after ASF regionalization deal takes effect
— Tyson plant closure narrows excess capacity but doesn’t upend national
beef slaughter utilization
— India’s sugar output surges early in 2025/26 season
— Agriculture markets yesterday
ENERGY MARKETS & POLICY
— Tuesday: oil holds firm as geopolitical risks rise
— U.S. ethanol group urges tougher response to China’s Phase One trade shortfalls
— Farm Bureau urges restraint on new China tariffs and warns retaliation risk
TRADE POLICY
— Hearing sets stage for sweeping debate over USMCA’s future
CONGRESS
— Senate GOP moves to advance more than 80 Trump nominees
POLITICS & ELECTIONS
— Tennessee special election tightens in deep-red district
HPAI / BIRD FLU
— Egg sector warns holiday demand could push prices higher again
FOOD & FOOD INDUSTRY
— USDA sets January meeting to refocus Salmonella reduction strategy
TRANSPORTATION & LOGISTICS
— Rail executives clash over transformative coast-to-coast UP/NS merger
WEATHER
— NWS outlook: first winter storm hits inland New England and Mid-Atlantic
Updates: Policy/News/Markets, Dec. 2, 2025
UP FRONT— Global growth outlook buoyed by AI investment despite tariff drag The OECD says the global economy is proving more resilient than expected as AI-driven investment props up growth despite Trump-era tariffs. Forecasts improve for 2025–26, but the group warns rising trade barriers and stretched tech valuations make the outlook fragile.— Trump administration backs Bayer’s bid for Supreme Court review The solicitor general urged the Supreme Court to take up Bayer’s Roundup appeal, significantly boosting the odds of review. A ruling could settle a major federal pre-emption question and sharply curtail tens of thousands of glyphosate lawsuits.— Costco moves to protect itself as tariff court fight nears climax Costco sued to ensure it can receive tariff refunds if the Supreme Court strikes down Trump’s emergency duties. The case joins a growing wave of corporate challenges as justices weigh the legality of tariffs imposed under IEEPA.— China poised to surge U.S. soybean buying despite tight deadline Bloomberg reports China can still hit its 12-million-ton pledge if state firms accelerate December purchases. Commercial incentives remain weak, but political pressure may drive a last-minute buying surge to stabilize the fragile U.S.–China trade truce.— Brazil’s beef exporters brace for China’s January ruling after a record year Brazil ends 2025 with record beef exports but faces a pivotal January decision on Chinese safeguards that could reshape global beef flows. Options under review range from quota systems that preserve Brazil’s dominance to restrictive measures that could disrupt supply chains.— Equities today Global stocks firmed as markets bet on a December Fed rate cut, with stable bond yields offering added support. Europe traded higher midday, while Asia was mixed.— Spain’s pork exports to China resume after ASF regionalization deal takes effect China reinstated Spanish pork shipments after activating a new regionalization protocol limiting bans to affected zones. The move contains trade fallout from an ASF detection and underscores the value of bilateral disease-management agreements.— Tyson plant closure narrows excess capacity but doesn’t upend national beef slaughter utilization Southern Ag Today analysis shows Tyson’s Lexington shutdown lifts 2025 utilization closer to long-term norms but still below historical averages. The closure tightens capacity but doesn’t yet signal a systemic processing shortage.— India’s sugar output surges early in 2025/26 season Stronger recovery rates and faster crushing pushed India’s sugar production up 43% through November. The rebound increases export potential but may pressure global prices.— Agriculture markets yesterday Grains were mostly lower, with soy complex weakness leading declines; wheat and corn slipped modestly. Livestock futures fell across the board, while cotton was little changed.— Tuesday: Oil holds firm as geopolitical risks rise Crude prices steadied as Ukraine–Russia tensions, Venezuela airspace moves, and OPEC+ caution added a risk premium. Fundamentals remain soft, but geopolitical uncertainty is keeping floors under the market.— U.S. ethanol group urges tougher response to China’s Phase One trade shortfalls The RFA pushed the administration to impose reciprocal duties on China for failing to meet ethanol and distillers-grain commitments under Phase One. The group says missed targets have cost farmers key market access.— The American Farm Bureau urges White House to preserve China trade ceasefire Farm Bureau warns new tariffs could trigger immediate Chinese retaliation and halt agricultural purchases again. The group urges negotiation over escalation, even as others call for a tougher stance.— Hearing sets stage for sweeping debate over USMCA’s future More than 100 witnesses begin three days of testimony as USTR launches its USMCA review process. Labor, agriculture, digital trade, environment, and auto-sector rules dominate early flashpoints.— Senate GOP moves to advance more than 80 Trump nominees Republicans are fast-tracking a new batch of executive nominees spanning Justice, Defense, Treasury, USDA, and more. USDA-related picks include Mindy Brashears (Food Safety), Stella Herrell (Assistant Secretary), and John Walk (Inspector General).— Tennessee special election tightens in deep-red district Republican Matt Van Epps remains favored, but a narrow margin would raise alarms for House GOP strategists ahead of the midterms. Democrats see competitiveness alone as a sign of shifting suburban dynamics.— Egg sector warns holiday demand could push prices higher again Producers say HPAI losses and peak-season demand could nudge egg prices upward. The sector is still recovering from last winter’s massive flock losses and awaits tools like vaccination.— USDA sets January meeting to refocus salmonella reduction strategy FSIS will convene stakeholders Jan. 14 to develop practical, data-driven approaches after withdrawing its earlier proposal. The agency seeks standards workable for both large integrators and small poultry processors.— Rail executives clash over transformative coast-to-coast UP/NS merger Industry leaders are sharply split on the proposed $85B UP–NS consolidation, touted as the first true transcontinental rail network. Supporters see long-overdue efficiency gains; critics warn of competition risks and massive regulatory hurdles.— NWS outlook A winter storm continues across inland New England and the Mid-Atlantic, bringing heavy snow and icing. Snow showers and colder temperatures will hold across much of the central and eastern U.S. over the next few days. TOP STORIES—Global growth outlook buoyed by ai investment despite tariff dragOECD says resilient U.S. and Europe offset early impacts of trump trade barriers, but warns risks are mounting The global economy is holding up better than expected under President Donald Trump’s sweeping tariffs, the OECD said Tuesday, crediting robust investment in artificial intelligence and supportive fiscal and monetary policies for cushioning early shocks. In its latest outlook, the Paris-based organization raised its growth forecasts for the U.S. and euro area for both 2025 and 2026, and made modest upward revisions for several other major economies. The OECD now expects global growth of 3.2% in 2025 before easing to 2.9% in 2026 as tariff effects intensify. OECD Secretary-General Mathias Cormann said the world economy has shown “resilience,” but warned the environment remains delicate. Trade growth slowed in the second quarter, he noted, and higher tariffs are expected to gradually raise prices for consumers and businesses, ultimately weighing on spending and investment. A major factor propping up activity is the surge in AI-related investment — especially in the U.S. — which has fueled data-center construction, buoyed global trade flows and produced outsized growth in the tech sector relative to the broader industrial economy. OECD analysts estimate the U.S. economy would have contracted by 0.1% in the first half of 2025 without the AI boom, given cooling household consumption and falling government purchases.  Still, the organization cautioned that AI-driven optimism has pushed tech-sector valuations to stretched levels, raising the risk of abrupt price corrections or forced asset sales. Bottom Line: Combined with fast-moving changes in trade policy, the OECD described the outlook as “fragile” and “subject to substantial risks,” even as near-term resilience remains stronger than anticipated.—Trump administration backs Bayer’s bid for Supreme Court reviewSolicitor General urges justices to resolve key federal-preemption question in Roundup litigation The Trump administration is urging the U.S. Supreme Court to hear Bayer AG’s appeal in a major Roundup case — dramatically increasing the odds the justices will take it up and potentially reshaping tens of thousands of glyphosate lawsuits. U.S. Solicitor General D. John Sauer recommended that the Court review a $1.25 million Missouri verdict, arguing that key failure-to-warn claims are pre-empted by federal pesticide law. Supreme Court petitions rarely succeed, but analysts say the chance rises to more than 70% when the solicitor general supports review. Bayer’s shares jumped as much as 15% on the news, their strongest surge in more than 20 years. Bayer has resolved more than 130,000 Roundup claims but still faces about 67,000 additional lawsuits alleging the herbicide causes cancer—an allegation the company disputes. Since acquiring Monsanto in 2018, Bayer has paid more than $10 billion in verdicts and settlements. Pivotal pre-emption question. The Court asked Sauer in June whether federal pesticide rules override state failure-to-warn claims. Sauer said appeals courts are split and urged the justices to clarify the issue. A decision favoring Bayer could sharply curb future litigation and lower settlement costs. UBS analysts say any Supreme Court involvement could help: if Bayer is allowed to add warning language, future claims dry up; if the Court rules Bayer can’t be held liable under state failure-to-warn laws, those claims disappear altogether. Broader impact. Bayer CEO Bill Anderson called the administration’s support “an important step” for farmers seeking regulatory clarity. Litigation concerns have been so persistent that Anderson has even considered ending glyphosate production. The justices are expected to decide by January whether to take the case, with a ruling likely by June 2026 if they do. The case is Monsanto v. Durnell, 24-1068. —Costco moves to protect itself as tariff court fight nears climaxRetail giant joins a growing list of companies seeking refunds if Supreme Court rejects Trump’s emergency tariff authority Costco has filed suit against the Trump administration to ensure it can recoup tariff payments if the Supreme Court ultimately rules that President Trump’s emergency duties are unlawful. The retailer, one of the largest companies yet to challenge the tariffs, submitted its case to the U.S. Court of International Trade on Friday. The filing argues that Costco must be formally in the queue for refunds should the justices strike down the administration’s use of the International Emergency Economic Powers Act (IEEPA) to justify sweeping reciprocal tariffs. The company did not disclose how much it has paid under the duties since the start of Trump’s second term, and executives declined to comment. The lawsuit comes as the Supreme Court weighs the legality of the tariffs, which were rolled out earlier this year. During last month’s arguments, several justices signaled skepticism toward the administration’s defense, raising expectations for a ruling before year-end — though timing remains uncertain. The White House has urged the court to rule quickly, with spokesperson Kush Desai warning of “enormous” economic consequences if the duties are struck down. Costco joins a broad coalition of challengers including Revlon, Bumble Bee Foods, Kawasaki Motors Manufacturing, and several Democratic-led states and lawmakers. A key unresolved issue is whether past tariff payments would be refunded if the court invalidates Trump’s policy. Justices offered little insight into how they might unwind duties already collected, and Congress could theoretically move to retroactively authorize them. Costco, the nation’s third-largest retailer by revenue, has told investors it is selectively raising prices and working with suppliers to shift production or adjust product offerings to blunt the financial impact. Chief Financial Officer Gary Millerchip said in September the company continues to explore ways to mitigate tariff costs, including changes to sourcing and assortment. —China poised to surge U.S. soybean buying despite tight deadlineTraders tell Bloomberg Beijing can still hit its 12-million-ton pledge — if state firms accelerate December bookings China may still be able to meet its politically significant pledge to buy at least 12 million tons of U.S. soybeans by year-end, traders told Bloomberg, even though time is rapidly running out and commercial incentives remain weak. In reporting by Hallie Gu of Bloomberg, multiple traders said they expect state-owned importers, especially Cofco, to take a heavier hand in December purchases. Those shipments would help honor commitments made during late-October discussions following the Xi/Trump meeting in South Korea — part of what markets hope is a fragile but functioning agricultural trade truce. “There would be no reason for them not to at least have made that amount of sales. Whether it’s shipped or not, that’s another thing,” UBS analyst Wayne Gordon told Bloomberg. A big gap to close in just weeks. According to Bloomberg’s calculations using USDA data, Chinese buyers have booked only about 3 million tons so far (others say 4 million to 4.5 million) — barely one-quarter of the target. To meet the pledge, China would need to book more than 2 million tons per week for the rest of December, including the Christmas period. Analysts warned that the pace is commercially unrealistic. Beijing-based Trivium China’s Even Pay told Bloomberg that the 12-million-ton goal is now “close to impossible… In early November that target was ambitious… But that didn’t eventuate, and hitting the target now would require China to be booking over 2 million tons each week,” she said. The slowdown reflects both logistical/bureaucratic hurdles and weak crush margins, as Brazilian beans remain cheaper for commercial processors. State buying could push total across the finish line. Despite the commercial headwinds, traders told Bloomberg that non-commercial buyers — primarily state firms — will keep absorbing cargoes, some destined for state reserves. Crucially, purchases booked before year-end could be shipped in early 2026, even into the next U.S. crop year, and still count toward the pledge. Using that mechanism, total booked volume could exceed 12 million tons, traders said, offering short-term relief to U.S. farmers and smoothing relations between Washington and Beijing. Cofco did not respond to Bloomberg’s request for comment. A test of the “Liberation Day” truce. China’s soybean purchases remain a sensitive bellwether in the broader U.S./China agricultural relationship. The late-October pledge was meant to resolve tensions after months of stalled buying and China’s growing reliance on Brazil. Whether December’s uptick reflects a genuine reset or merely a political gesture ahead of 2026 negotiations remains unclear. But any additional U.S. orders this month would signal at least a temporary stabilizing of trade between the world’s two largest economies — and come at a critical moment for American producers. —Brazil’s beef exporters brace for China’s January ruling after a record yearSector closes 2025 on strong volumes as Beijing weighs quotas, tariffs or other safeguards Brazil’s beef industry is ending 2025 on a high note — but with an anxious eye on Beijing. China’s decision to extend its investigation into surging beef imports, largely from Brazil, has given meatpackers short-term breathing room but no real certainty. The probe, which examines whether rising imports from 2019–2024 harmed China’s domestic market, now runs through January 2026 and could result in quotas, tariffs, or other safeguard measures. From January to October, Brazil shipped 2.79 million tonnes of beef valued at $14.31 billion to more than 160 markets. China accounted for nearly half: 1.34 million tonnes worth $7.1 billion. Exporters expect to end the year with a global record of roughly 3 million tonnes and close to $15 billion in receipts — with about 1.6 million tonnes headed to Chinese ports. A ruling that could reshape global beef trade. Unofficial assessments suggest several safeguard options are being weighed. One would establish a global import quota allocated proportionally among suppliers, with tariffs imposed on volumes above the ceiling. That scenario would preserve Brazil’s dominant market position and largely lock in today’s trade structure. A more restrictive option — a global quota administered directly by China’s General Administration of Customs (GACC) — is seen as potentially “awful” for Brazil, introducing uncertainty and disrupting existing supply chains. Brazilian industry groups, including ABIEC and ABRAFRIGO, are holding comments until the decision is made. Some argue the Chinese process violates WTO rules and warn that an unfavorable ruling could prompt a formal challenge in Geneva. China buys time — and tests market balances. The extension also appears to give China breathing room as it prioritizes broader trade talks with the United States. Domestic beef prices in China have begun to recover, easing pressure to act aggressively against imports. Yet Beijing still faces political demands to protect farmers while staying within WTO disciplines. China’s reliance on foreign beef complicates its choices. The U.S. shipped fewer than 140,000 tonnes of beef to China in 2024, compared to more than 1.3 million tonnes from Brazil. American beef tends to serve the premium market, while Brazilian product is used mainly in processed or sauce-based dishes — meaning the two do not compete directly. Reports say China has limited supplier alternatives. Brazil, they argue, grew into the gap left by declining U.S. and Australian shipments rather than from expanding Chinese consumption. Any safeguard that meaningfully constrains Brazilian volumes, they warn, would push prices higher. “They want us to stop exporting, but who will fill that demand?” one meatpacker said. “Neither China nor our competitors have the production.” Industry prepares for January — and possible WTO action. Brazil’s private sector is keeping quiet publicly, but behind the scenes exporters are documenting how their products complement, rather than displace, Chinese production. Most Brazilian beef imported into China, they stress, is processed by Chinese companies rather than competing with domestic farmers. Upshot: With a record export year nearly in the books, Brazil’s beef sector now enters 2026 waiting for a ruling that could cement its dominance — or force a painful strategic reset. |
| FINANCIAL MARKETS |
—Equities today: Global stocks climbed as hopes for a U.S. interest-rate cut next week helped keep markets afloat. Wall Street futures edged higher after major U.S. markets closed down yesterday. U.S. equity futures are higher thanks to the combination of a strong Japanese government bond auction and largely as-expected EU inflation data which are both helping yields stabilize after a sharp rise to start December yesterday. there is one Fed speaker: Bowman (10:00 a.m. ET), and the Treasury will hold a 6-Week Bill auction at 11:30 a.m. ET. Markets are looking for dovish signals via strong demand for short-duration Treasuries and fresh support for a December Fed rate cut. In Asia, Japan flat. Hong Kong +0.2%. China -0.4%. India -0.6%. In Europe, at midday, London +0.4%. Paris +0.5%. Frankfurt +0.7%.
—Equities yesterday:
| Equity Index | Closing Price Dec. 1 | Point Difference from Nov. 28 | % Difference from Nov. 28 |
| Dow | 47,289.33 | -427.09 | -0.90% |
| Nasdaq | 23,275.92 | -89.76 | -0.38% |
| S&P 500 | 6,812.63 | -36.46 | -0.53% |
| AG MARKETS |
—Spain’s pork exports to China resume after ASF regionalization deal takes effect
New protocol contains fallout from Bellaterra outbreak, allowing trade from disease-free zones
Spain’s new regionalization agreement with China is already paying dividends after an African swine fever (ASF) detection briefly halted the country’s pork exports to its largest non-EU customer. China suspended all Spanish pork imports on Nov. 28 following confirmation that two wild boars found dead in Bellaterra tested positive for ASF. But under the Nov. 12 protocol reached during King Felipe VI’s visit to Beijing, both sides agreed to limit trade disruptions to affected zones rather than impose blanket bans.
Spain’s agriculture ministry announced that China has now implemented that deal — establishing an exclusion zone around the Bellaterra area—and has resumed pork imports from all regions outside the containment zone.
The move is significant for Spain, the EU’s largest pork producer, which ships €3.5 billion ($4.05 billion) in pork annually. China alone represents 42% of Spain’s pork exports beyond the EU.
Authorities are still investigating the source of the outbreak. The European Commission said it will refrain from comment until an EU veterinary team conducts an on-site assessment this week. Meanwhile, Spain has imposed operating and sales restrictions on hog farms within a 20-kilometer radius of the detection site as part of its containment protocol.
Of note: The situation underscores the importance of regionalization agreements which limit the trade impacts from animal diseases with the U.S. and China inking a regionalization on highly pathogenic avian influenza (HPAI) deal via the Phase One agreement just ahead of a case being found in South Carolina turkeys. Prior to the regionalization agreement, China would normally have blocked all U.S. poultry, but the deal prevented the widespread trade halt.
—Tyson plant closure narrows excess capacity but doesn’t upend national beef slaughter utilization
Southern Ag Today analysis shows adjusted 2025 capacity use moves closer to historical norms after Lexington shutdown
The announced closure of Tyson’s Lexington, Nebraska beef-processing plant — set for January 2026 — has triggered significant questions about national slaughter capacity utilization (CU) amid already tight fed-cattle supplies. In Southern Ag Today’s latest analysis (link), Charley Martinez (Assistant Professor, Univ. of Tennessee) and Parker Wyatt (Graduate Teaching Assistant) assess how the shutdown reshapes national CU in the short run and whether this marks a structural shift for the packing sector.
Tyson’s Lexington facility processed roughly 5,000 head per day, equal to about 20% of Tyson’s 25,800-head daily company capacity. Using methods outlined in Martinez et al. (2023), the authors adjust the national CU measure by removing that daily volume and comparing it with the five-year average, 2024 utilization, and 2025 levels.
Their updated monthly estimates show that 2025’s adjusted CU tracks notably closer to the historical five-year average.
• The five-year average CU through November is 90.1%
• 2025 CU averages 83.1%
• 2025-adjusted CU rises to 87.7%
For November specifically, CU stood at 83.5%, down from 88.4% in November 2024, the five-year norm of 89.8%, and the 2025-adjusted figure of 87.8%.
The authors note that 2025’s tight fed-cattle supplies, lighter cattle-on-feed numbers, and elevated fed-cattle prices have squeezed packer margins. Larger carcass weights have provided only partial relief. Tyson’s decision to shutter Lexington — the first major plant closure since Cargill shut its Plainview, Texas facility in 2013 during similar supply-tight conditions — suggests the industry may now be operating with excess physical capacity.
Reports that Tyson may attempt to purchase the idle Cargill Plainview plant, along with new facilities expected to come online in 2026 and 2027, raise broader questions about whether the 87–88% CU range represents a new normal or simply a temporary, supply-driven adjustment.
The authors conclude that while the Lexington closure tightens operational capacity, the national industry remains below historical utilization levels — highlighting ongoing supply strain but not yet indicating a systemic capacity crunch.
—India’s sugar output surges early in 2025/26 season
Stronger recovery rates and faster crushing fuel a 43% jump, paving the way for additional exports
India’s sugar production jumped 43% in the first two months of the 2025/26 season, reaching 4.1 million metric tons by the end of November, according to industry groups cited by Reuters. The sharp rise — up from 2.88 million tons a year earlier — reflects stronger recovery rates and accelerated crushing across major producing states, reinforcing expectations that India will have room to export surplus supplies without risking domestic shortages, though increased availability could pressure global prices.
Production soared in Maharashtra, the country’s top sugar-producing state, more than tripling to 1.7 million tons. Uttar Pradesh output also grew 9% to 1.4 million tons. Karnataka was the main outlier: production slipped to 774,000 tons from 812,000 tons a year ago as farmer protests over cane prices disrupted crushing operations.
The National Federation of Cooperative Sugar Factories reported that the national recovery rate rose to 8.51%, up from 8.29% a year earlier — an important metric reflecting sugar extracted per unit of cane.
With less cane being diverted to ethanol production this year, the NFCSF recommended that the government authorize an additional 1 million metric tons of sugar exports to clear the surplus. India has already approved 1.5 million tons of exports this season, though mills have struggled to finalize deals because global prices are currently below domestic levels.
The Indian Sugar & Bio-Energy Manufacturers Association is pressing New Delhi to raise the long-unchanged minimum domestic sugar sale price, arguing that production costs have steadily climbed over the past six years.
—Agriculture markets yesterday:
| Commodity | Contract | Dec 1 Close | Diff vs Nov 28 |
| Corn | March | 4.45 | -0.0275 |
| Soybeans | January | 11.28 | -0.0975 |
| Soybean Meal | March | 319.50 | -4.70 |
| Soybean Oil | March | 0.5284 | +0.0029 |
| SRW Wheat | March | 5.35 | -0.035 |
| HRW Wheat | March | 5.2675 | -0.0075 |
| Spring Wheat | March | 5.76 | -0.02 |
| Cotton | March | 0.6463 | -0.0008 |
| Live Cattle | February | 215.925 | -1.925 |
| Feeder Cattle | January | 321.075 | -2.90 |
| Lean Hogs | February | 80.30 | -0.70 |
| ENERGY MARKETS & POLICY |
—Tuesday: Oil holds firm as geopolitical risks rise
Ukrainian drone attacks, U.S./Venezuela tensions, and OPEC+ caution keep market on edge
Oil prices steadied on Tuesday as traders balanced rising geopolitical risks against persistent concerns about a looming supply glut.
Brent crude eased 19 cents, 0.3%, to $62.98 a barrel, while U.S. West Texas Intermediate slipped 12 cents, 0.2%, to $20 a barrel. Both benchmarks gained more than 1% on Monday, with WTI nearing a two-week high.
Analysts said the escalating tensions around the Black Sea and Venezuela have injected fresh risk premium into the market, even as fundamentals remain soft.
The Caspian Pipeline Consortium reported Monday that it resumed shipments from one mooring point at its Black Sea terminal after a major Ukrainian drone strike on Nov. 29. Meanwhile, President Donald Trump declared airspace over and around Venezuela “closed,” heightening uncertainty for flows from the major producer.
Markets are also watching Ukrainian peace talks, where analysts note Russia could gradually raise crude and product exports if negotiations progress — a process expected to be slow. Kyiv insists that sovereignty and security guarantees remain non-negotiable, with territorial disputes still the toughest issue.
Trump’s special envoy Steve Witkoff and Jared Kushner are set to meet Russian President Vladimir Putin on Tuesday for discussions on ending the war.
Adding to the cautious tone, OPEC+ on Sunday reaffirmed a modest output increase for December and a pause on further hikes in the first quarter of next year amid deepening fears of a global supply overhang.
—U.S. ethanol group urges tougher response to China’s Phase One trade shortfalls
RFA presses Trump administration for reciprocal duties after Beijing misses Phase One targets
The Renewable Fuels Association (RFA) on Monday urged the Trump administration to impose reciprocal duties on Chinese ag exports, arguing that Beijing failed to honor key purchase commitments under the 2019 Phase One trade agreement — particularly for U.S. ethanol and distillers grains.
In comments to the U.S. Trade Representative, RFA President and CEO Geoff Cooper thanked President Trump for prioritizing “fair and reciprocal trade with China,” and applauded USTR for re-examining China’s missed obligations.
The association said China bought just 58% of the U.S. goods and services it committed to purchase in 2020–2021 — and failed to acquire any of the additional $200 billion in goods pledged for the two-year period, ultimately landing $11.6 billion below even baseline purchase levels.
On ethanol, RFA noted that China’s commitments fell sharply short.
• In 2020, U.S. exports to China totaled 31.7 million gallons worth nearly $51 million.
• In 2021, China bought just over 100 million gallons valued at $162 million.
• Since 2021, imports have “flatlined” near zero.
A similar pattern was seen in distillers grains purchases.
Cooper said the shortfalls have denied U.S. farmers and ethanol producers a meaningful export market at a time of mounting economic pressure in rural America. “As our nation’s farmers and rural communities face serious economic challenges, it is critical that our trading partners live up to their commitments and be held accountable,” he said.
The association argued that unless China restores its Phase One agriculture commitments, the U.S. should respond with reciprocal trade actions to protect domestic producers and reinforce the credibility of future agreements.
| The American Farm Bureau Federation is urging the Trump administration to hold firm to the recent trade ceasefire with China, warning that any new U.S. tariffs could prompt Beijing to once again shut off purchases of American farm goods. In comments filed Monday with the Office of the U.S. Trade Representative, the group said it is concerned that China could retaliate if the administration imposes new duties following its ongoing Section 301 probe into Beijing’s compliance with the 2020 Phase One agreement. The Farm Bureau emphasized that recent Chinese agricultural purchases have fallen short of expectations, but argued the solution lies in negotiation rather than escalation. “Engage in discussions with your Chinese counterparts to resolve trade concerns, such as a shortfall in the most recent purchase commitments, before resorting to further tariffs,” the group wrote. Additional tariffs, it warned, would almost certainly trigger Chinese countermeasures “by increased tariffs and other restrictions” on U.S. agricultural exports. The Farm Bureau’s position diverges from other commenters in the docket, including trade and industry groups urging the administration to take a tougher line. As of Monday afternoon, USTR had posted submissions from more than 50 organizations and stakeholders — several of which called for a strong U.S. response to what they characterize as China’s continued failure to fully meet its Phase One obligations. |
What could prevent a U.S. retaliation move from happening
1. Broader U.S./China negotiations underway. The Trump administration is juggling multiple fronts — tariffs, semiconductor restrictions, rare earths, and a potential April 2026 Xi/Trump summit. If Beijing is providing cooperation elsewhere, Trump may delay or narrow retaliation.
2. U.S. inflation concerns. Retaliatory tariffs on Chinese farm imports could raise prices on:
• amino acids
• ag chemicals
• feed inputs
• processed foods
This would clash with Trump’s messaging on lowering grocery bills and affordability.
3. Treasury and USDA hesitation. USDA (Sec. Rollins) and Treasury (Sec. Bessent) may prefer a more targeted approach rather than a broad tariff hike that could trigger blowback in commodities.
Bottom Line: The White House wants a symbolic action to satisfy farm groups. Less likely if Trump is preserving maneuvering room ahead of major China negotiations.
| TRADE POLICY |
—Hearing sets stage for sweeping debate over USMCA’s future
Three-day session will draw more than 100 witnesses across business, labor, agriculture, tech and environmental sectors
The Office of the U.S. Trade Representative will hear from more than 100 witnesses this week as it launches an expansive, three-day hearing on the future of the U.S.–Mexico–Canada Agreement (USMCA). The packed agenda, released Monday, previews an intense and wide-ranging debate ahead of the agreement’s formal July 2026 review — one that could shape the direction of North American trade for years.
Testimony begins Wednesday with Reps. Chris Smith (R-N.J.) and Josh Riley (D-N.Y.). Smith, a lead sponsor of the Uyghur Forced Labor Prevention Act, is expected to press Canada and Mexico to expand enforcement against forced labor — one of several labor issues that may dominate early panels. Riley, who has urged USTR to treat the review as a chance to “fix deficiencies,” is poised to spotlight concerns over labor and environmental standards in Mexico, rising Chinese investment, and USMCA’s digital trade rules.
Civil society organizations, including Public Citizen and Rethink Trade, take the stage next, reiterating longstanding objections to the agreement’s digital provisions and calling for “major reforms” to prioritize labor rights, environmental protections and equitable development. Researchers from a range of academic institutions follow, offering contrasting views — from recommendations on adding critical-minerals rules to arguments that the agreement is functioning effectively and requires only minor adjustments.
Agriculture and manufacturing feature prominently Wednesday afternoon and Thursday. USTR will hear from major farm groups — corn, soybeans, dairy and others — followed by textile, apparel and retail associations, migration and Indigenous advocates, and pharmaceutical representatives. Former House Ways & Means Chair Kevin Brady (R-Texas), representing the Coalition for North American Trade, opens Thursday’s first panel. The coalition, which he launched with former lead negotiators from Mexico and Canada, is pushing to extend and strengthen USMCA rather than overhaul it.
Manufacturers and auto-sector stakeholders will occupy much of Thursday’s schedule. The long-contentious rules of origin for autos remain a flashpoint, drawing testimony from automaker groups and the United Auto Workers, who are expected to revive debates that dominated the original negotiations.
Friday’s panels turn to digital trade, environmental issues, and energy. Tech groups — including the Coalition of Services Industries and the Computer & Communications Industry Association — are slated to raise concerns about policies such as Canada’s paused digital services tax. Environmental stakeholders will highlight issues like cross-border pollution, with testimony from the City of Coronado, California, which urged USTR to ensure Mexico adopts “long-term, structural controls” to prevent repeat environmental failures.
The final day also features energy-sector testimony from the American Clean Power Association, which has backed efforts to escalate a trade dispute with Mexico over its energy policies. Additional sessions will cover fisheries, maritime shipping, labor unions and human rights organizations, rounding out one of the broadest, most diverse slates of USMCA stakeholders to appear before USTR since the agreement entered into force.
The hearing’s breadth underscores the political and economic stakes of the upcoming USMCA review, as nearly every major sector in North America lines up to influence what could be the most consequential rewrite of the pact since 2020.
| CONGRESS |
—Senate GOP moves to advance more than 80 Trump nominees
Next high-volume batch includes key justice, defense, USDA and economic posts as Republicans accelerate confirmations
Senate Republicans are preparing to advance the next large package of President Donald Trump’s nominees — more than 80 in total — as part of the chamber’s new high-volume confirmation process that speeds up executive branch staffing.
Majority Leader John Thune (R-S.D.) on Monday night filed an executive resolution (SRes. 520) to initiate consideration of the third such batch. GOP leadership changed Senate rules earlier this year to permit en bloc action after Democrats repeatedly delayed the usual expedited floor procedure. This week’s package includes nominees for U.S. attorneys and senior roles across Treasury, Labor, Defense, Commerce, USDA, the National Labor Relations Board, and other agencies.
Republicans view the fast-track process as critical to filling posts across the government before the 2026 midterms. Several of the nominees are expected to draw Democratic objections but will advance under the streamlined rules.
USDA officials contained in the nominee list. Three nominees are tied directly USDA:
1. Mindy Brashears — Undersecretary of Agriculture for Food Safety. Would serve as USDA’s top food-safety official, overseeing FSIS and related public-health programs.
2. Stella Herrell — Assistant Secretary of Agriculture. Senior departmental leadership role under the Secretary of Agriculture.
3. John Walk — Inspector General, Department of Agriculture. Would lead USDA’s Office of Inspector General, responsible for audits, investigations, and oversight.
| POLITICS & ELECTIONS |
—Tennessee special election tightens in deep-red district
GOP favored, but a narrow margin would send signals to House Republicans
Voters in Tennessee’s 7th District head to the polls today to choose a successor to former Rep. Mark Green (R-Tenn.), in a seat Donald Trump carried by 22 points. Polls close at 8 p.m. ET. The district includes a slice of Nashville and rural areas.
Special elections are notoriously unpredictable, and both parties acknowledge that Republican Matt Van Epps is the likely winner over Democratic state Rep. Aftyn Behn. Yet the fact that Behn is even competitive in such a ruby-red district is notable.
If Van Epps ultimately wins by only about five points — the margin many operatives now expect — it will raise significant questions about the GOP’s political standing less than a year before the midterms and deepen concerns inside the House Republican Conference about its hold on the majority. However, others argue you don’t lose by winning and one special election is never a true bellwether for mid-term elections.
| HPAI/BIRD FLU |
— Egg sector warns holiday demand could push prices higher again
Producers still recovering from massive flock losses as HPAI threat persists
The U.S. egg industry is sounding fresh alarms that highly pathogenic avian influenza (HPAI) could tighten supplies and nudge prices upward just as the holiday season boosts demand. American Egg Board CEO Emily Metz told Politico that Thanksgiving and Christmas represent “the highest demand periods of the year,” and with limited supply, “prices do what they do in those conditions.”
Since Sept. 25, four confirmed HPAI outbreaks have hit commercial table-egg flocks, wiping out a combined 5.3 million birds. The largest was a 3.08-million-bird operation in Jefferson County, Wisconsin. Metz noted the sector still hasn’t fully recovered from the devastating 50 million birds lost between October 2024 and February 2025 — a shock that continues to constrain production capacity heading into winter.
“We’re not out of the woods yet,” Metz said. “Our farmers are doing everything they can, but we need some more tools in our toolbox, and those tools are a ways off yet.”
Industry leaders are working closely with USDA to advance an HPAI vaccination strategy. USDA has earmarked $100 million for vaccine development as part of its broader plan to stabilize egg supplies. But vaccine development is inherently slow, and international trade partners continue to raise concerns about the market implications of vaccinating poultry, creating additional hurdles.
For now, the sector remains focused on avoiding further outbreaks — and preparing for potential market turbulence if more cases emerge during peak holiday demand.
| FOOD & FOOD INDUSTRY |
—USDA sets January meeting to refocus salmonella reduction strategy
FSIS Seeks fresh input after withdrawing earlier proposed rule
USDA’s Food Safety and Inspection Service (FSIS) announced it will hold a public meeting on Jan. 14, 2026, to gather feedback on new, practical approaches for reducing Salmonella illnesses linked to poultry products. According to a Federal Register notice, the session is part of USDA’s broader food-safety modernization push and comes after the agency withdrew its earlier Salmonella framework proposed rule due to concerns raised during the public comment period.
FSIS said it is looking for concrete strategies that align public-health goals with operational realities across the poultry sector. “FSIS is seeking input on how to address Salmonella through better use of data, alternative performance standard parameters, and policy options that reflect both public health goals and industry realities, especially for small and very small producers,” the agency noted.
The meeting will focus on data-driven approaches, revised performance standards, and policy tools that can work equitably across companies of different sizes.
| TRANSPORTATION/LOGISTICS |
—Rail executives clash over transformative coast-to-coast UP/NS merger
$85B deal promises first true transcontinental freight network — but leaders warn efficiency gains, competition tests, and regulatory hurdles could reshape the entire rail industry
The proposed $85 billion Union Pacific–Norfolk Southern merger dominated the recent RailTrends conference in New York, with analysts and railroad executives sharply divided over whether the deal represents a long-overdue modernization — or a risky leap into uncharted territory ahead of next week’s formal STB filing.
The merger aims to create the nation’s first true coast-to-coast freight railroad, combining 50,000 route miles across 43 states and connecting nearly 100 U.S. ports. At stake is whether the industry sees a historic breakthrough or disruptive consolidation.
Why advocates say the deal makes sense. Conference host and rail analyst Tony Hatch outlined three drivers behind the merger:
• Persistent interline inefficiencies that have slowed Eastern–Western freight movements for decades.
• Opportunities to cut SG&A, creating what proponents argue could become a more efficient national network.
• A “watershed opportunity” in the Mississippi River basin, where UP–NS integration could turn historically clunky interchanges into near-seamless freight transfers.
“If interline becomes just a pit stop, you offer better service… but that’s an ‘if,’” Hatch warned, adding that the industry won’t fully grasp the implications until the Surface Transportation Board receives the official filing and stakeholders weigh in. He said the decision could be “the most important in the 200-year history of the industry.”
Competitors watching — cautiously. Hatch also stressed that other Class I railroads are “getting access benefits without having to give anything up.” But if UP–NS gains scale rapidly, he predicted rival mergers could follow.
Concerns from CSX and BNSF. Kevin Boone, EVP & CFO at CSX, said long-standing joint service agreements have worked precisely because neither railroad has full control. That balance could tilt after a merger. “Those things are going to have to be resolved as we work through the process,” he said, arguing that the touted watershed benefits require substantial investment, not just single-line access.
BNSF EVP & CMO Tom Williams said the merger “could reshape the industry — and fast,” especially since it will be the first tested under the STB’s post-2001 public-interest rules, which require affirmative proof of competitive benefits.
Williams questioned whether some of the early UP/NS claims “pass the common-sense test,” noting that eliminating existing transcontinental pairings could wipe out entire freight lanes “overnight.”
If approved, the UP–NS merger would redefine U.S. freight rail. But as RailTrends made clear, the industry is far from united — and the STB’s ruling could set a precedent for years to come.
| WEATHER |
— NWS outlook: First winter storm of the season for inland New England and the
Mid-Atlantic continues today with heavy snow and impactful icing… …Snow showers forecast across the northern Plains/Great Lakes and Great Basin/Rockies over the next couple of days in an active winter-like pattern… …Chilly temperatures continue across much of the eastern and central U.S.
