Analysis of Farmer Bridge Assistance Program 

Farmers upset about USDA implementation of SDRP2 | Trump orders blockade of sanctioned Venezuelan oil tankers, escalating pressure on Maduro

---

Link: Spring Prices, Smaller Checks: Why USDA’s SDRP2 Is Leaving Some
          Disaster-Stricken Farms Empty-Handed
Link:  Lighthizer: Why the Postwar Trade System Is Breaking — And What Comes Next
Link: Video: Wiesemeyer’s Perspectives, Dec. 13
Link: Audio: Wiesemeyer’s Perspectives, Dec. 13

---

Updates: Policy/News/Markets, Dec. 17, 2025

UP FRONT— Conservatives applaud Trump’s $12B farm aid, but farmers say it falls short: Conservative media/allies praise the package and blame China/Democrats, while many producers say it doesn’t cover multi-year margin pressure, rising costs, and uncertainty.— Trump orders blockade of sanctioned Venezuelan oil tankers: Trump escalates pressure on Maduro by targeting tanker flows; market reaction is mostly risk-premium given Venezuela’s smaller output and constrained capacity.— Trump’s beef pricing push splits his base: Tariff relief/import-friendly moves to lower food prices anger cattle producers who say it undercuts domestic prices and investment certainty.— When could Washington lift the remaining fentanyl tariff on China?: Recent cooperation signals progress, but U.S. officials likely require sustained proof on precursor enforcement before removing the final 10%.— Why ending the last 10% fentanyl tariff could matter for soybeans: Even non-ag tariffs can reshape China’s landed-cost math and policy risk, potentially improving U.S. soybean competitiveness if reciprocity follows.— Equities today: Global stocks firmer as markets parse data and watch Fed speakers; dovish tone viewed as supportive for risk assets.— Equities yesterday: Major U.S. indexes mixed, with the Dow lower and Nasdaq slightly higher.— Santa’s rally tends to arrive late in December: Seasonal pattern shows most of December’s historical gains come in the back half of the month, with early-month chop common.— Ford ends battery partnership as EV strategy resets: Ford cancels a large LG Energy Solution deal as it scales back EV plans amid weaker demand/regulatory shifts.— Kubota signals more North American price increases: Kubota plans further equipment price hikes to offset tariff costs, saying prior increases had limited sales impact.— USDA daily export sales: USDA reported fresh 2025/26 activity including 198,000 MT of soybeans sold to China, 177,055 MT of corn to Mexico, and 125,000 MT of soybeans to unknown destinations, alongside a cancellation of 132,000 MT of white wheat to China that will be reflected in the Weekly Export Sales report due Dec. 29.— U.S. soybean sales to China (USDA-based tally): USDA announcements imply roughly ~4 MMT (higher if “unknown” is assumed China), while a prior higher figure reflected trade contacts too.— Brazil and India power a global sugar rebound in 2025/26: USDA projects a sizable production rebound led by Brazil/India, lifting global supplies and stocks despite EU declines.— Agriculture markets yesterday: Daily futures recap shows broad weakness in grains/softs with strength in feeders/hogs.— Neiffer corrects FBA/ECAP comparison: Farm CPA Report flags a column error in a prior payment-percentage comparison table and provides the corrected version.— SDRP2 handling “lit a fire” in farm country: Using spring prices vs fall prices is shrinking or eliminating payments for many producers, intensifying backlash and cash-flow stress.— Bridge aid narrows the gap (farmdoc analysis): Estimated FBA payments materially improve 2025 return projections in parts of Illinois but timing (cash in 2026) and regional shortfalls remain.— Oil prices bounce on Venezuela blockade, but downside risks persist: Crude rebounds on headlines/short covering, yet oversupply and Russia-Ukraine dynamics still dominate the bearish setup.— Oil slides to four-year lows as oversupply fears deepen: Prices hit multi-year lows on surplus expectations and potential Russian supply return; curve signals looser balances.— EPA pushes RFS decisions into early 2026: EPA tells the court it expects a single Set 2 final rule in Q1 2026 as it weighs SRE reallocation and comments.— Southeast Asia trade surge raises tariff questions: Vietnam/Thailand export growth reflects both “China-plus-one” shifts and transshipment concerns; rules-of-origin enforcement remains a key uncertainty.— Phase One scrutiny rekindled as USTR weighs China compliance: Witnesses broadly cite Chinese shortfalls but split on whether more tariffs help or backfire; ag groups urge caution.— House GOP shelves ACA subsidy vote: Johnson says talks collapsed; enhanced premium credits set to expire without House action, setting up a political flashpoint.— Inside the Wiles doctrine (Vanity Fair): A portrait of Susie Wiles as an execution-focused chief of staff amid maximalist governance choices, internal divisions, and rising midterm stakes.— USDA orders rapid SNAP recertification in Minnesota: USDA demands accelerated recertification in four counties tied politically to broader anti-fraud messaging, raising state-federal tension and admin burden.— China presses for control in Panama ports standoff: Beijing allegedly seeks a Cosco controlling stake in a BlackRock-led ports deal, clashing with U.S. security red lines and stalling talks.— Grassley sees gridlock ahead for H-2A reform: Grassley says partisan absolutism and White House resistance make major farm-labor legislation unlikely beyond incremental appropriations tweaks.— NWS outlook: Hazardous winds/snow and heavy Pacific Northwest rain, with above-average temps shifting cooler for the Northern Plains/Upper Midwest. TOP STORIES—Conservatives applaud Trump’s $12 billion farm aid, but farmers continue to say it falls shortRight-leaning voices blame China and past Democratic trade policy for farm pain, while producers warn the aid doesn’t temper years of rising costs and market pressure Conservative commentators and farm-policy allies largely welcomed President Trump’s $12 billion aid package for farmers hit by tariffs, framing the payments as necessary relief amid an aggressive global trade environment. On the Breitbart News Daily Podcast, rural-policy expert Brian Reisinger squarely blamed Beijing, arguing that China deliberately “weaponized soybeans” by targeting U.S. farmers to apply political pressure on the Trump administration. Administration officials echoed that message. Appearing on The Sean Hannity Show, USDA Secretary Brooke Rollins criticized President Biden’s trade record, noting he “didn’t sign one new trade deal in four years,” and cast the aid as part of a broader push to restore farm prosperity. Rollins described the payments as “one of many steps” aimed at delivering an era of growth for farmers and ranchers not seen in generations. Other farm voices struck a more structural tone. Some commentators say today’s farm stress traces back to the Covid era, when ultra-low interest rates and government stimulus drove up input costs while grain prices failed to keep pace, squeezing margins long before tariffs became the dominant issue. Farmers themselves, however, offer a more sobering assessment. While acknowledging the political support and short-term relief, many producers said the $12 billion package does not compensate enough for sustained losses, elevated costs, and ongoing market uncertainty — underscoring a growing gap between political messaging and on-the-ground farm economics. —Trump orders blockade of sanctioned Venezuelan oil tankers, escalating pressure on MaduroMove targets Caracas’ economic lifeline, lifts oil prices modestly, and raises risks of further instability without materially tightening global supply President Donald Trump ordered a blockade of sanctioned oil tankers entering and leaving Venezuela, sharply escalating U.S. pressure on President Nicolás Maduro while expanding America’s military posture in the region. Trump said Venezuela was now “completely surrounded” by what he described as the largest naval force ever assembled in South America, warning that the pressure campaign would intensify. The blockade directly targets the core of Venezuela’s economy: oil exports, which provide nearly all the government’s foreign currency. While the move threatens to deepen Venezuela’s already severe economic crisis, its impact on global oil markets is expected to be limited given the country’s diminished production capacity. Venezuelan crude output has collapsed by roughly 70% over the past quarter-century to under 1 million barrels per day, with exports last month averaging about 590,000 barrels per day — negligible compared with global consumption exceeding 100 million barrels per day. Most of that oil flows to China. Markets nonetheless reacted to the heightened geopolitical risk. U.S. benchmark West Texas Intermediate rose as much as 1.7% to trade near $56 a barrel, rebounding from its lowest level in nearly five years. Trump also designated the Maduro government a “foreign terrorist organization,” accusing it of using oil revenues to finance drug trafficking, human trafficking, and other crimes. Venezuela’s government condemned the measures as a “reckless and serious” violation of international law and said it would immediately denounce the action at the United Nations. Caracas framed the blockade as an attempt to seize control of the world’s largest proven oil reserves, reaffirming its sovereignty over natural resources. The escalation follows a series of concrete enforcement actions. Last week, U.S. authorities seized a sanctioned tanker, The Skipper, off Venezuela’s coast. In the days that followed, several supertankers bound for Venezuela reversed course. The Pentagon has also carried out more than 20 strikes against alleged drug-trafficking vessels near Venezuela and Colombia, underscoring the increasingly militarized nature of the campaign. Analysts warn that the pressure is still building. Rapidan Energy Group said the White House’s actions raise the odds of military strikes and a potential political transition, noting that U.S. pressure is likely to intensify in the coming weeks. Economically, the squeeze is already biting. Venezuela’s dollar inflows — almost entirely tied to crude sales — fell about 30% in the first ten months of 2025, exacerbating currency weakness and price pressures. Private economists estimate inflation could exceed 400% by year’s end, pushing the country closer to hyperinflation. Despite the tightening sanctions, some oil operations continue. State-owned PDVSA works with international partners, including Chevron, which operates under a U.S. Treasury license exempting it from sanctions. Chevron said its Venezuelan operations remain uninterrupted and compliant, though it has reportedly lowered prices on Venezuelan crude sold to U.S. refiners following the tanker seizure. For Maduro, the blockade adds to mounting internal strain. He has urged citizens to rally against what he calls U.S. aggression, expanded deployments of troops and equipment along borders and coastal areas, and encouraged enlistment in a mass civilian militia. For global markets, however, the episode is less about supply disruption and more about geopolitics — another flashpoint in an already volatile energy and security landscape. —Trump’s beef pricing push splits his baseEfforts to curb food costs by easing tariffs and expanding imports fuel discontent among U.S. cattle producers even as consumers benefit President Donald Trump’s recent decision to roll back tariffs on imported beef and other food staples has ignited a fresh political and economic debate — one that pits grocery affordability against the livelihoods of America’s ranching communities. Trump’s recent executive actions eliminating or reducing tariffs on products including beef, tomatoes, coffee and bananas were designed to ease the pressure of high grocery prices facing U.S. households. The administration has framed the changes as a response to voter concerns about inflation and living costs, and has justified exemptions on the grounds that many of these goods cannot be produced domestically in sufficient quantities. However, the impact on U.S. cattle producers has been sharply negative, threatening the economic foundation of a sector that has long been politically aligned with Trump. Ranchers contend that importing more Argentine and Brazilian beef under lower tariff barriers undercuts domestic cattle prices at a time when supplies are already tight. “It would turn us against him,” said one rancher, reflecting widespread frustration that a policy intended to help consumers is being perceived as detrimental to producers’ margins and long-term viability. The response from key industry groups has been negative. The National Cattlemen’s Beef Association acknowledged the potential benefits of lower consumer prices but warned that flooding the domestic market with imported beef could undermine U.S. family farmers and ranchers who are already grappling with high input costs and a reduced cattle herd. Underlying the controversy is the broader contradiction in Trump’s trade strategy. Earlier in the year, the administration had erected sweeping tariffs under its so-called “liberation day” policy aimed at protecting U.S. producers and reducing trade deficits. Many ranchers initially welcomed tougher trade barriers, saying they helped elevate cattle prices after years of depressed markets. But the recent tariff rollbacks — particularly on beef — have reversed course sharply, triggering volatility in cattle futures and creating uncertainty among ranchers about future policy direction. Some ranchers, worried that the plan to increase beef imports would make it harder to justify long-term investments, said prices sagged immediately after the announcements. Economists also question whether expanded imports will meaningfully lower retail beef prices in the short term. U.S. cattle supplies remain at multi-decade lows owing to drought and other constraints, and imported lean beef is often blended into processed products rather than sold as prime cuts, diluting the effect on consumer bills. The political consequences are already surfacing. Ranchers in key swing states have expressed deep disappointment with a president they helped carry to victory, even as some voters elsewhere continue to prioritize lower food costs over producer interests. A recent Reuters survey found that many Trump supporters blame factors beyond presidential policy for inflation, though concerns about price spikes — especially for food — weigh heavily on public opinion. Ahead of future elections, the beef pricing battle raises tough questions about how far a sitting president can balance competing priorities within his own political coalition — between rural producers dependent on strong farm economics and urban and suburban voters eager for everyday affordability.—When could Washington lift the remaining fentanyl tariff on China?Recent joint drug seizures signal progress, but U.S. officials are likely to demand sustained proof before cutting the last 10% duty The seizure last month of 430 kilograms of cocaine at Shenzhen’s Yantian port — carried out by Chinese authorities with U.S. intelligence support — has added fresh evidence that U.S./China counternarcotics cooperation is no longer just rhetorical. The case, disclosed this week by China’s state broadcaster CCTV, is being read in Washington as an early test of whether Beijing is following through on commitments made directly to President Donald Trump. That question matters because the remaining 10% “fentanyl tariff” the U.S. still applies to Chinese imports is explicitly tied to narcotics cooperation. Trump agreed in late October to remove half of the 20% fentanyl-related tariffs in exchange for tighter Chinese controls on precursor chemicals. The other half was left deliberately conditional. Why the tariff is still in place. Senior Trump administration officials have framed the fentanyl tariff less as a traditional trade tool and more as leverage. Trump underscored that framing this week by calling illicit fentanyl a “weapon of mass destruction,” signaling that progress will be judged by results, not promises. Of note: While Beijing points to resumed working groups, joint investigations, and port-level interdictions, U.S. agencies are focused on whether cooperation produces durable reductions in precursor flows — not one-off successes. The Shenzhen seizure, involving cocaine rather than fentanyl itself, nonetheless demonstrates operational intelligence-sharing that had largely frozen during previous diplomatic breakdowns. The milestones Washington is watching. Based on administration statements and the structure of the October Busan agreement, the remaining 10% tariff is unlikely to be removed until three conditions are met:  1. Sustained enforcement track record. U.S. officials want multiple months of documented joint cases, not just isolated seizures, showing consistent Chinese action against trafficking networks and chemical exporters. 2. Verified controls on precursor chemicals. Beyond scheduling substances, Washington is watching for enforcement actions against chemical firms and brokers, including prosecutions or export-license denials tied directly to fentanyl precursors. 3. Formal confirmation through the bilateral working group. The Trump administration is expected to rely on reports from the revived U.S.–China counternarcotics working group to certify compliance before recommending tariff relief. Likely timing: months, not weeks. Even with the positive signal from Shenzhen, a near-term tariff cut is improbable. The most realistic window would be late Q1 or early Q2 of 2026, assuming additional joint cases emerge and Chinese enforcement remains visible through the winter. Any major relapse — or evidence that precursors continue reaching Mexican cartels at scale — would almost certainly freeze the tariff in place. Of note: Canada wants to work more closely with China to stop the chemicals used to create the deadly synthetic opioid fentanyl from reaching North America, said Prime Minister Mark Carney’s point person for fighting the opioid crisis. In short, the fentanyl tariff is functioning exactly as Trump designed it: a pressure valve tied to measurable outcomes. The latest seizure suggests the valve may eventually open further — but only after Washington is convinced the cooperation is structural, not symbolic.—Why ending the last 10% U.S. fentanyl tariff could move the needle for soybeansTariffs aimed at drugs still ripple through agriculture by shaping China’s buying math, policy risk, and the competitiveness of U.S. soybeans Lifting the remaining 10% U.S. “fentanyl tariff” on China would matter for soybeans even though soybeans themselves are not the direct target of that duty. In the China market, agricultural trade decisions are rarely siloed. Tariffs influence landed costs, crush margins, and — critically — policy signaling that guides state and private buyers alike. If Beijing were to reciprocate by reducing its own tariff or countermeasures, the effect on U.S. soybean competitiveness would be immediate and meaningful. Below is the logic, step by step. 1. Soybean trade is decided on marginal landed cost, not headline prices. China purchases soybeans on razor-thin margins, comparing all-in delivered costs rather than futures prices or FOB quotes alone. The calculation typically looks like this:• FOB Brazil + ocean freight• FOB U.S. Gulf or PNW + freight + tariffs + policy risk A reciprocal 10% tariff reduction narrows that spread in favor of U.S. origin. It lowers the all-in landed cost of U.S. soybeans and, just as importantly, reduces the “policy premium” Chinese crushers often assign to U.S. cargoes during periods of strained relations. In practice, it does not take much to flip buying decisions. A shift of $10–$20 per metric ton is often enough to move a 60,000- to 70,000-mt cargo from Brazil to the United States on a trader’s spreadsheet. 2. Tariffs directly affect crush margins and buying flexibility. Chinese state buyers such as Sinograin and COFCO, as well as private crushers, operate under strict constraints:• Fixed or closely monitored soybean meal and oil selling prices• Government sensitivity to food-price inflation• Limited tolerance for losses on imported raw materials A tariff reduction improves crush margins on U.S. soybeans and allows buyers to book U.S. cargoes without seeking special waivers or exemptions. It also makes U.S. beans competitive earlier in the marketing year, rather than only during supply gaps when Brazil is temporarily unavailable. This timing matters. Before Brazil’s peak export window opens, U.S. soybeans often sit on the edge of competitiveness. Tariffs can push them out; tariff relief can pull them back in. 3. Policy symmetry matters to Chinese buying behavior. Chinese buyers do not operate in a purely commercial vacuum. Their decisions are influenced by:• Diplomatic signals from Beijing• Guidance to “diversify supply” or “support stable relations”• Risk management around sudden policy shifts If the United States removes the final 10% fentanyl tariff and China mirrors that move, it sends a clear signal: reduced risk of abrupt escalation and implicit permission for state firms to lean into U.S. origin. Even if Brazil remains marginally cheaper on paper, that signal alone can unlock millions of tons of discretionary buying. 4. Brazil’s dominance is partly policy-driven, not just price-driven. Brazil enjoys structural advantages in soybeans, but its dominance is not absolute:• Freight spreads fluctuate• Brazilian premiums rise when Chinese demand surges• Logistics bottlenecks routinely emerge during peak export months When tariffs distort the playing field, China defaults to Brazil as the low-risk option. When tariffs ease, U.S. soybeans re-enter the conversation almost immediately — especially PNW shipments into southern China, where freight economics can be highly competitive. 5. Tariff rollback reinforces China’s credibility on purchase pledges. Beijing has made repeated soybean purchase commitments — some formal, others informal. Removing retaliatory tariffs linked to the fentanyl dispute would make those pledges economically feasible rather than purely political. Tariff relief reduces the need for state-directed losses on U.S. cargoes and encourages market-based buying, which is both larger and more sustainable. Historically, soybean bookings tend to accelerate after trade tensions ease, not before, precisely because buyers regain the ability to act commercially. 6. The bottom line for U.S. soybean prices. If the remaining 10% fentanyl tariff is lifted and China reciprocates, the likely impacts include:• Stronger Gulf and PNW basis levels• More frequent Chinese spot purchases outside crisis windows• Higher odds of China meeting or exceeding annual U.S. soybean buying targets• Reduced reliance on U.S. government backstop programs to support farm income For U.S. farmers, the issue is not symbolism. It is price formation. Tariffs raise the bar U.S. soybeans must clear to compete in China. Removing them lowers that bar — immediately, measurably, and in ways that ripple from export terminals back to farmgate prices.

FINANCIAL MARKETS

 —Equities today: Global stocks climbed as markets continued to assess U.S. economic data for interest rate policy direction, while a surprise drop in British inflation propelled UK stocks amid rate-cut hopes. U.S. stock futures signaled a higher opening. In Asia, Japan +0.3%. Hong Kong +0.9%. China +1.2%. India -0.1%. In Europe, at midday, London +1.5%. Paris -0.2%. Frankfurt -0.1%. There are three notable Fed speakers today: Waller (8:30 a.m. ET), Williams (9:05 a.m. ET), and Bostic (12:30 p.m. ET), and the more dovish their collective tone is, the better for risk assets.

—Equities yesterday: 

Equity Index	Closing Price  Dec. 16	Point Difference  from Dec. 15	% Difference  from Dec. 15
Dow	48,114.26	-302.30	-0.62%
Nasdaq	23,111.46	+54.05	+0.23%
S&P 500	6,800.26	-16.25	-0.24%

—Santa’s rally historically shows up late in December

Why the second half of the month has carried nearly all of December’s gains

An interesting seasonal chart highlighted in the Sevens Report shows that while December is historically one of the strongest months for U.S. equities, almost all of that strength has tended to arrive in the second half of the month, not the first. This pattern helps explain why early December choppiness is often followed by a late-month rally, even in years when markets struggle out of the gate.

According to the Sevens Report, December has averaged a 1.4% gain over the past 75 years, ranking second only to November, and has posted positive returns more than 73% of the time, the highest “win rate” of any month. However, the report emphasizes that nearly 100% of December’s average return since 1950 has come from the back half of the month. By contrast, the first half of December has typically been choppy and flat-to-down—closely mirroring recent early-December weakness, with the S&P 500 down roughly 0.5% through mid-month in line with historical norms.

The late-month strength is commonly attributed to several seasonal forces converging at once: lighter trading volumes, year-end portfolio “window dressing,” reinvestment of bonuses, and anticipation of the so-called Santa Claus rally, defined as the final five trading days of December and the first two trading days of January. While the Sevens Report cautions that this is a historical tendency rather than a guarantee, the data suggest that investors waiting for confirmation before putting sidelined cash to work have, historically, been rewarded more often than not during the second half of December.

—Ford pulls plug on major battery partnership as EV strategy resets

Automaker scraps $6.5 billion LG Energy Solution deal after cutting EV output amid weaker demand outlook and regulatory shifts

Ford has terminated a planned $6.5 billion battery supply deal with South Korea’s LG Energy Solution, underscoring the depth of its pullback from aggressive electric-vehicle expansion.

In a regulatory filing, Ford said the decision followed its move to dramatically scale back EV production, including halting output of certain models. The automaker cited regulatory changes and a reassessment of EV demand as key factors behind both the production cuts and the cancellation of the battery agreement.

The move reflects a broader strategic reset at Ford, which is recalibrating its EV ambitions as consumer uptake slows and policy conditions evolve, reducing the need for large, long-term battery supply commitments tied to earlier growth projections.

—Kubota signals more North American price increases as tariff costs mount

Incoming CEO says recent hikes barely dented demand and even lifted market share

Japan’s Kubota plans to raise prices again next year on tractors and construction equipment sold in North America as it continues to pass through the cost of U.S. tariffs imposed under President Donald Trump, according to incoming CEO Shingo Hanada.

Hanada said Kubota expects tariffs to dent results by roughly ¥80 billion to ¥90 billion ($517 million to $581 million) in 2026 — about double the hit projected for this year. The company intends to offset those costs through a combination of further price increases and tighter control of fixed expenses.

Kubota already lifted prices in September, raising small-tractor prices by about 2% and construction equipment prices by roughly 5% in North America, while also scaling back preferential financing rates for buyers. Those measures are expected to cover a ¥40 billion hit to operating profit this year.

Notably, Hanada said the initial price hikes have had little negative effect on sales. In some segments, Kubota’s market share has increased, helped by demand for its higher-performance midsized tractors and product differentiation versus competitors that also raised prices.

Looking ahead, Hanada said additional price increases will be necessary in 2026, though the size of those hikes has not yet been determined.

Separately, Kubota is leaning on India as a key growth engine. The company produces lower-cost “basic tractors” domestically in India and is considering building a new manufacturing facility to expand capacity, after scrapping a previous site due to water-supply concerns. Kubota also plans to invest about 20 billion rupees ($220 million) in Escorts Kubota, its tractor subsidiary in Haryana state, as part of broader efforts to strengthen its global production footprint.

AG MARKETS

—USDA daily export sales: 

•198,000 MT soybeans to China during the 2025/2026 marketing year
•177,055 MT corn to Mexico during the 2025/2026 marketing year
•125,000 MT soybeans to unknown destinations, 2025/2026 marketing year
•Cancellation of 132,000 MT white wheat to China, 2025/2026 marketing year.  This sale was first reported on Nov. 20, 2025, and the cancellation information will be included in the Weekly Export Sales report to be issued on Monday, Dec. 29, 2025.

—U.S. soybean sales to China just looking at USDA information. 

Relative to announced USDA soybean sales, if you add 2.506 MMT via weekly export sales and 1.574 MMT via daily sales announcements since then, you get to 4.080 MMT. If you add unknown destinations as China soybean purchases, that would total around 5 MMT, but historically, Europe does a fair amount using unknown along with some others.

The up to 8 MMT soybean sales figure we used in an item on Tuesday was based on both USDA and trade contact information.

—Brazil and India power a global sugar rebound in 2025/26

Rising output in key producers offsets EU declines, lifting world supplies and stocks

Global sugar production is forecast to climb sharply in the 2025/26 marketing year, driven primarily by strong rebounds in Brazil and India that more than offset weaker output in the European Union, according to USDA’s Sugar: World Markets and Trade report.

Worldwide production is projected to rise by 8.3 million metric tons year over year to about 189.3 million tons, with Brazil and India accounting for the bulk of the increase. Brazil’s output is forecast at 44.4 million tons, supported by favorable weather, higher sugar yields, and a production mix that favors sugar over ethanol. India is expected to post a 26% rebound to 35.3 million tons as plantings and yields recover from El Niño–related disruptions. Together with higher output in Thailand and Australia, these gains underpin stronger global export availability.

By contrast, EU sugar production is forecast to fall about 5% to 15.5 million tons, reflecting an 8% decline in sugar beet area, particularly in major producing countries such as France and Germany. Lower EU output is expected to reduce exports and increase import needs, partially offsetting supply growth elsewhere.

On the demand side, global consumption is rising more slowly than production, leading to a projected increase in ending stocks, largely concentrated in India and China. China’s production is forecast higher at 11.5 million tons, and with output growing faster than consumption, its stocks are expected to jump nearly 50%. Thailand’s exports are forecast to rebound to 7.0 million tons, while India’s exports recover modestly as supplies improve.

For the United States, USDA projects slightly lower production at 8.5 million tons and reduced imports, reflecting quota programs set at minimum levels consistent with WTO and free-trade obligations, as well as lower projected shipments from Mexico. U.S. consumption is forecast marginally lower, with stocks declining mainly due to reduced imports rather than demand growth.

Overall, the report points to a loosening global sugar balance in 2025/26, with expanding production and rising stocks easing supply pressures, even as regional divergences — particularly between major exporters and the EU—continue to shape trade flows.

—Agriculture markets yesterday:

Commodity	Contract  Month	Close Dec. 16	Change vs  Dec. 15
Corn	March	$4.36 1/2	-3 1/4¢
Soybeans	January	$10.62 3/4	-9¢
Soybean Meal	January	$302.40	-$1.10
Soybean Oil	January	48.36¢	-112 pts
Wheat (SRW)	March	$5.09 1/2	-11 1/4¢
Wheat (HRW)	March	$5.05	-7¢
Spring Wheat	March	$5.65	-3 3/4¢
Cotton	March	63.10¢	-84 pts
Live Cattle	February	$230.70	+15¢
Feeder Cattle	January	$343.325	+$3.40
Lean Hogs	February	$84.775	+92 1/2¢

FARM POLICY

—Neiffer corrects info in FBA/ECAP comparison. Paul Neiffer of Farm CPA Report provided a chart on Tuesday showing the comparison of FBA versus ECAP. He informs “an observant reader noticed that we had the initial payment % and top up % in the wrong column.” The corrected table follows.

—USDA’s handling of SDRP2 payments has lit a fire in farm country 

Farmers perplexed why USDA is not being farmer friendly in latest changes

USDA’s decision to use spring planting prices rather than fall harvest prices under the second Supplemental Disaster Relief Program (SDRP2) is sharply reducing — and in some cases eliminating — payments for producers who suffered real disaster losses. And a growing number of farmers are complaining about the situation. Link to special report on this topic.

One farmer emailed me the following:

“Add my farm to the list of farms that was expecting an SDRP2 payment initially, only to find that we would be at zero using spring prices.  If a producer would like to voice his frustration and complaint, to whom should those sentiments be directed? Legislators or USDA? And if the answer is USDA, then who specifically at USDA? I can’t tell you how stressful the emotional roller coaster is when I despair of surviving this down cycle in agriculture, then feel great relief at the prospect of financial aid, only to inevitably be disappointed by what this administration actually delivers. All the while I look nervously toward the banker to see how he is going to view all of these developments. What I find particularly frustrating about the SDRP2 program change is that the money is already budgeted and approved. The administration should be looking for ways to get it out the door and to farmers hands, not looking for ways to save. If the endgame is to eventually spend the entire $16B appropriation via top up payments, then giving a few farms windfall top up payments while others in need get nothing is going to leave a very lasting bad taste in the mouths of previously supportive farmers, myself included.” 

Comments: USDA can still fix the issue. There is room within the reg to do so.

—Bridge aid narrows the gap: How USDA’s new payments reshape 2025 farm returns

Estimated Farmer Bridge Assistance lifts corn-soy returns toward breakeven in much of Illinois, but regional gaps persist

USDA’s newly announced $12 billion Farmer Bridge Assistance (FBA) program is expected to materially improve 2025 farm income projections, particularly for corn-soybean operations in northern and central Illinois, according to a Dec. 16 analysis. While the assistance is not enough to erase losses everywhere, the authors find it meaningfully narrows deficits and pushes many cash-rent farms back to or just above breakeven — highlighting the growing role of ad hoc aid alongside traditional farm programs.

Published in farmdoc daily by the University of Illinois, the article “Impact of Estimated Farmer Bridge Assistance on 2025 Farmer Return Projections” is authored by Nick Paulson and Gary Schnitkey of the University of Illinois’ Department of Agricultural and Consumer Economics, and Carl Zulauf of Ohio State University’s Department of Agricultural, Environmental and Development Economics. Link for details.

What the Farmer Bridge Assistance program does. USDA announced the FBA program on December 8, allocating $11 billion to row crops and $1 billion to specialty crops to offset losses tied to low prices, high costs, and trade disputes. Official payment rates are due the week of December 22, with payments expected by late February 2026. The authors stress that all rates in their analysis are estimates, not final USDA figures.

Estimated payment rates across major crops. Using acreage data from USDA’s Farm Service Agency, cost estimates from ERS, and price and yield assumptions from WASDE, the authors model FBA payments as a uniform share (30%) of estimated net losses, like the approach used in the 2024 Emergency Commodity Assistance Program (ECAP). Their estimates suggest per-acre FBA payments of roughly $46 for corn, $25 for soybeans, and $39 for wheat, with rates ranging from about $21 per acre for barley to $134 per acre for rice. In most cases, the estimated FBA rates exceed ECAP payments, despite soybeans being a notable exception.

Impact on Illinois farm returns. Incorporating higher price assumptions, updated ARC/PLC projections, and estimated FBA payments, the authors find that total federal support for 2025 could approach $100 per acre in northern and central Illinois. For a 50-50 corn-soybean rotation on cash-rented land, average returns improve to about $21 per acre in northern Illinois and $19 per acre in high-productivity central Illinois, while low-productivity central Illinois hovers just below breakeven. Southern Illinois remains negative, with average returns still around –$33 per acre, even after the added assistance.

Timing and policy implications. A key point emphasized by the authors is timing: most of the income support boosting 2025 returns — both ARC/PLC and FBA — will actually be received in 2026, underscoring near-term cash-flow pressures despite improved projections. They also caution that because FBA calculations appear not to net out ARC/PLC or crop-insurance indemnities, some crops could ultimately receive support exceeding modeled losses. Final USDA payment rates will determine how large that effect becomes.

ENERGY MARKETS & POLICY

—Wednesday: Oil prices bounce on Venezuela tanker blockade, but downside risks persist

Trump’s move lifts crude more than 1%, though traders warn global oversupply and Russia-Ukraine talks still dominate sentiment

Oil prices rebounded more than 1% on Wednesday after President Donald Trump ordered what he called a “total and complete” blockade of all sanctioned oil tankers entering and leaving Venezuela, injecting fresh geopolitical risk into markets that had just settled near five-year lows.

Brent crude rose 87 cents, 1.5%, to $59.79 a barrel, while U.S. West Texas Intermediate gained 85 cents, 1.5%, to $56.12. The move followed a sharp selloff in the prior session, driven by optimism that progress in Russia/Ukraine peace talks could eventually ease sanctions on Moscow and release more supply into an already well-supplied market.

Traders said the rebound was largely sentiment driven. Several noted that futures buying accelerated after prices dipped below $60 a barrel, triggering short covering rather than a fundamental shift in supply dynamics. Venezuela’s oil output accounts for roughly 1% of global production, limiting the broader impact even if tanker movements are disrupted.

Market participants remain skeptical the rally will last. Asian crude traders described the Venezuelan news as a short-term catalyst, while emphasizing that Russia/Ukraine negotiations and weak demand expectations continue to pose downside risks. Some suggested the bounce could offer an opportunity to re-establish short positions.

Uncertainty also surrounds how the blockade would be enforced. Trump’s comments come a week after the U.S. seized a sanctioned tanker off Venezuela’s coast, and recent months have seen increased U.S. naval presence in the region. Still, not all vessels moving Venezuelan oil are sanctioned, and tankers chartered by Chevron continue to ship crude to the U.S. under existing authorizations.

Analysts noted that Venezuelan crude flows are concentrated among a small group of buyers, primarily Chinese independent refiners, the U.S., and Cuba. China remains the largest buyer, with Venezuelan barrels accounting for about 4% of its imports. Given ample supply in sanctioned crude markets, analysts said any near-term price upside is likely capped unless disruptions escalate beyond Venezuela and affect the wider Americas energy system.

While a sharp rally appears unlikely in the short term, some analysts cautioned that prolonged disruptions could eventually lend support to heavy crude grades, even as expectations of a global supply glut continue to anchor overall price outlooks.

—Tuesday: Oil slides to four-year lows as oversupply fears deepen

Russia/Ukraine peace optimism and weak demand signals reinforce a bearish crude outlook

Oil prices settled at their lowest levels since early 2021 on Tuesday as markets weighed persistent oversupply against rising optimism that a Russia/Ukraine peace deal could eventually ease sanctions on Russian crude. Brent fell $1.64 to $58.92 a barrel, while WTI dropped $1.55 to $55.27, with both benchmarks down nearly 3% on the day.

Sentiment deteriorated as diplomatic signals pointed to progress in talks to end the war in Ukraine. Traders increasingly see a path for additional Russian barrels to return to global markets, amplifying an already well-supplied outlook. Even without a formal agreement, expectations of higher future supply have pressured forward curves, with Brent’s six-month spread slipping into contango for the first time since October — a classic signal of surplus conditions.

The broader fundamental backdrop remains decisively bearish. Major banks and consultancies continue to project sizeable global oil surpluses extending into 2026, with supply growth expected to outpace demand by a wide margin. Analysts say futures prices are increasingly reflecting this imbalance, reinforcing downward pressure absent a major geopolitical or policy shock.

Demand concerns added to the selloff. Fresh Chinese data showing softer factory output and weaker consumer activity raised doubts about global demand’s ability to absorb rising production. While U.S. enforcement actions against Venezuelan oil exports offered modest support at the margins, traders noted that ample floating storage and pre-emptive buying of sanctioned barrels have blunted the impact.

With inventories building, demand growth slowing, and surplus expectations entrenched, crude markets remain vulnerable — leaving prices highly sensitive to whether geopolitics can meaningfully disrupt supply or whether oversupply will continue to dominate the outlook into next year.

—As expected, EPA pushes renewable fuel mandate decisions into early 2026

Court filing shows agency still weighing refinery exemption impacts as biofuel volumes slip past year-end targets

The Environmental Protection Agency has confirmed what we signaled months ago — that it will not finalize the 2026 and 2027 Renewable Fuel Standard volumes until early 2026, extending a timeline that had already slipped multiple times this year.

In a Dec. 15 filing with the U.S. Court of Appeals for the D.C. Circuit, EPA said it now expects to issue a single final “Set 2” rule in the first quarter of 2026, following consultations with the Office of Management and Budget. The agency had earlier indicated it would complete the rulemaking by October, later revising that target to year-end.

EPA said the delay reflects ongoing review of public comments on its proposal to reallocate renewable volume obligations that were waived under small refinery exemptions between 2023 and 2025. The comment period on that proposal closed Oct. 31, and the agency is still assessing how those reallocations should be incorporated into the 2026 and 2027 standards.

In its filing, EPA emphasized it wants to resolve both issues in a single rule, stating that it “recognizes the importance of issuing one final Set 2 rule that establishes the RVOs for 2026 and 2027 and addresses the reallocation of SREs from 2023–2025 in these years.”

TRADE POLICY

—Supply chains, not just shell games: Southeast Asia’s trade surge raises tariff questions

Rising exports from Vietnam and Thailand to the U.S. reflect both China-plus-one manufacturing shifts and lingering concerns over tariff evasion, analysts say 

A sharp rise in U.S.-bound exports from Vietnam, Thailand and other Southeast Asian countries is reigniting U.S. accusations that Chinese goods are being rerouted to dodge American tariffs — even as trade experts say much of the activity reflects longer-running supply-chain realignments rather than outright fraud.

The Trump administration has warned it could impose an additional 40% tariff on goods deemed to be “transshipped,” accusing some exporters of falsely declaring origin to bypass steep levies on China. Commerce Secretary Howard Lutnick has argued that Vietnam in particular functions as “a pathway of China to us,” citing the country’s heavy imports from China alongside booming exports to the U.S.

Trade data do show striking shifts. Chinese exports to Vietnam and Thailand jumped nearly 25% between May and October from a year earlier, while U.S. trade deficits with both countries hit record highs this summer. ASEAN-wide exports were up 15% year over year in October, according to Australia’s Lowy Institute, and shipments from China to ASEAN rose 10% on a three-month average basis in November, Kpler data show.

But a closer look suggests a more nuanced picture. “Much of the increase in exports from China to Vietnam and Thailand involved inputs such as chips and computer processors,” Nikkei Asia reported, while exports from those countries to the U.S. surged in finished electronics including laptops, smartphones and game consoles. Vietnam, for example, shipped about $9 billion more in laptops to the U.S. between May and September than a year earlier, while its laptop imports from China rose by only about $100 million.

Analysts say that pattern is consistent with the “China plus one” strategy that accelerated after Trump’s first trade war — shifting final assembly to Southeast Asia while still sourcing many components from China. “Producers with multiple production sites worldwide have likely shifted production from China to non-Chinese locations,” said Chim Lee of the Economist Intelligence Unit, noting that upstream inputs often remain Chinese because electronics supply chains are highly globalized.

Chinese manufacturers have poured billions into Southeast Asian factories, with the region now accounting for more than a third of China’s foreign direct investment, according to Rhodium Group. A Boston Consulting Group study found nine in 10 American manufacturers moved some supply-chain links out of China between 2018 and 2023.

Still, U.S. officials remain concerned about shell entities and minimal processing designed solely to reclassify Chinese goods. Former USTR official Dawn Shackleford said Washington has yet to clearly define how it will determine origin under any new enforcement push, warning that unresolved rules of origin could ensnare legitimate manufacturers. Duke University economist Edmund Malesky added that if U.S. authorities treat products with more than 30% Chinese inputs as transshipped, “a lot of companies are in trouble,” including American brands operating in Vietnam.

Estimates of illicit activity vary widely. Exiger, which works with U.S. Customs and Border Protection, estimates $10 billion to $30 billion of goods are transshipped annually from China, with Southeast Asia accounting for more than half of detected cases since 2016. Academic studies, however, suggest the scale may be limited: Malesky’s research on Vietnam during the 2018 trade war found roughly 10% of increased trade involved pure pass-through, while an IMF paper published in July concluded Vietnam had not enabled rerouting “on a significant scale.”

Business groups in the region say scrutiny has intensified and incentives to transship have diminished as U.S. tariffs expanded to cover Vietnam and other ASEAN countries, narrowing duty differentials. With China also diversifying its export markets beyond the U.S., analysts say today’s trade flows increasingly reflect genuine production shifts — and rising local demand in Southeast Asia — rather than a simple tariff-evasion play.

CHINA

—Phase One scrutiny rekindled as USTR weighs China’s compliance — and tariff options

Agriculture, tech and manufacturing witnesses split over whether tougher duties would fix Beijing’s shortfalls or backfire on U.S. exporters and consumers

A small but diverse group of industry representatives told U.S. trade officials Tuesday that China has fallen short of its commitments under the 2020 Phase One trade deal, even as they sharply disagreed on whether new tariffs are the right response. The testimony came at a sparsely attended hearing convened by the Office of the U.S. Trade Representative as part of a Section 301 investigation launched in October to assess China’s record under the agreement.

The hearing, held at the U.S. International Trade Commission, drew 11 witnesses spanning agriculture, technology and manufacturing, alongside numerous written submissions from stakeholders who did not appear in person. USTR officials are first evaluating whether China failed to meet its obligations; only if they conclude it did would the probe move to a second phase considering remedies.

The review continues despite a recent Trump/Xi announcement of a narrower bilateral arrangement that included lower U.S. tariffs, a one-year suspension of port fees on Chinese ships, expanded U.S. export controls, and Chinese commitments to ease its own mineral export controls and buy more U.S. soybeans. U.S. Trade Representative Jamieson Greer has said unresolved Phase One issues still warrant scrutiny.

Agriculture urges caution on tariffs. Agricultural groups warned that escalating trade penalties could disrupt fragile negotiations. American Soybean Association Chair Josh Gackle said producers have “strong reservations” about using the probe to justify new tariffs, arguing the administration should instead use talks to press China to follow through on its purchase pledges and work toward a future “Phase Two” deal.

Gackle noted uncertainty over the timing of China’s latest soybean purchase commitments and urged officials to examine why Beijing missed earlier agricultural targets. In written comments, ASA and the U.S. Soybean Export Council questioned whether the shortfall constituted a breach at all, pointing to language in the deal that tied purchases to market conditions. They argued China would have had to buy U.S. soybeans at a premium to Brazil or in volumes large enough to distort prices to hit the targets.

Biofuels and seeds cite clear failures. Other farm-related witnesses were less forgiving. Renewable Fuels Association President Geoff Cooper said China had “reneged” on promises to increase ethanol imports and instead raised tariffs on U.S. denatured fuel ethanol to 70%, effectively closing the market. While preferring a negotiated fix, he said RFA would support new U.S. tariffs — potentially on used cooking oil or lithium — if talks fail.

The American Seed Trade Association highlighted persistent biotechnology barriers. Senior Director Samuel Crowell said China’s approvals for new ag biotech traits remain among the world’s slowest, imposing years-long delays. North Dakota State University economist Sandro Steinbach quantified the impact, estimating that a three-year delay in access to a typical yield-enhancing trait could, over time, mean tens of billions of bushels of corn and billions of bushels of soybeans are never produced due to permanently lower yield trajectories.

Tech industry split on enforcement tools. Technology groups echoed long-running concerns about intellectual property theft and counterfeiting. Stephen Ezell of the Information Technology and Innovation Foundation said there has been “absolutely no change” in China’s IP practices since the deal and urged USTR to label platforms such as Temu and Shein as “notorious markets.”

But the Consumer Technology Association cautioned against relying on tariffs, arguing they have failed to change Chinese behavior while raising costs and, paradoxically, making China a more attractive production base as the U.S. levies duties on other partners. CTA urged coordinated action with allies instead.

The Entertainment Software Association pressed for carve-outs if tariffs are expanded, asking USTR to exclude video game consoles and accessories. The group said consoles underpin a U.S. software and services market exceeding $50 billion annually and remain difficult to fully source outside China despite diversification efforts.

Manufacturers recount mixed tariff outcomes. Individual manufacturers offered sharply different assessments of the original Section 301 tariffs. Some, such as flooring maker HMTX Industries, credited the duties with spurring U.S. investment but said supply constraints now justify removing them. Others argued their products were unfairly excluded or removed from tariff lists, enabling import surges and IP theft.

Still others warned of severe unintended consequences. Precision Components said tariffs on certain bearing parts it imports from China have climbed to effective rates near 92%, costs it says are borne by U.S. producers and consumers and undermine export competitiveness. “The current tariff structure makes a U.S.-manufactured bearing more expensive inside the United States than anywhere else in the world,” the company told officials.

Taken together, the testimony underscored a central dilemma for USTR: widespread agreement that China has not fully honored Phase One commitments, paired with deep divisions over whether renewed tariffs would restore compliance — or simply compound costs for U.S. industries already caught in the crossfire.

CONGRESS

—House GOP shelves vote as ACA/ObamaCare subsidy deadline looms

Speaker Johnson says talks collapsed, leaving enhanced premium credits set to expire without floor action

House Speaker Mike Johnson (R-La.) said Tuesday that the House will not hold a vote this year on extending enhanced Affordable Care Act/ObamaCare premium tax credits, dashing hopes among Republican moderates for last-minute action before the subsidies expire at the end of the month.

The credits, first expanded during the Covid-era response, are set to lapse in roughly two weeks — a move that would sharply raise health insurance premiums for millions of Americans. Moderate Republicans had pushed for a vote on an amendment that would have attached an extension to a broader health policy bill moving through the House.

But Johnson said weekend negotiations failed to produce a deal that could clear leadership and the Rules Committee. While some members wanted a vote to ease political pressure, he said no workable path emerged. House Majority Leader Steve Scalise echoed that assessment, acknowledging extensive internal discussions but confirming the decision not to advance the issue procedurally.

Absent congressional action, the enhanced subsidies will expire automatically, setting up a political and policy flashpoint heading into 2026.

POLITICS & ELECTIONS

—Inside the Wiles doctrine: Power, loyalty, and the limits of restraint in Trump’s second term

In a sweeping and controversial Vanity Fair interview written by Chris Whipple, White House Chief of Staff Susie Wiles describes her role as Trump’s chief enabler, crisis manager, and political realist — revealing how far she will go to execute the president’s vision, and where she believes the guardrails still hold 

In an unusually candid, on-the-record series of interviews with Vanity Fair, White House Chief of Staff Susie Wiles offers a rare, insider portrait of power at the center of President Trump’s second administration. Wiles portrays herself not as a restraining force but as a facilitator — someone tasked with translating Trump’s instincts into action rather than redirecting them. “I am the chief of staff, not the chief of you,” she says, echoing James Baker’s maxim while making clear that deference to Trump’s authority is foundational to her approach.

Wiles describes Trump as possessing “an alcoholic’s personality” — a product of boundless confidence and impulsiveness — and argues that managing such a leader requires firmness without confrontation. Her influence, she suggests, comes from earned trust, not control. Senior officials including Vice President JD Vance and Secretary of State Marco Rubio reinforce this depiction, casting Wiles as the singular channel through which Trump’s will is organized and enforced.

The interview chronicles a presidency marked by maximalist exercises of power: sweeping tariffs rolled out with little coordination, mass deportations carried out under expansive legal theories, unilateral military strikes on alleged drug traffickers, and the near dismantling of USAID under Elon Musk’s direction. On dismantling USAID: “No rational person could think the USAID process was a good one. Nobody.” On several fronts — tariffs, deportations, foreign aid — Wiles acknowledges internal disagreement and operational chaos, yet repeatedly aligns herself with Trump’s ultimate decisions, even when outcomes prove politically or morally fraught.

On Jan. 6 pardons, Wiles says she initially pressed for distinctions between violent and nonviolent offenders but ultimately accepted Trump’s view that the justice system had treated defendants unfairly. On the Epstein files, she concedes Trump’s name appears in the records but insists there is no evidence of wrongdoing, while acknowledging that mishandling the issue has alienated a critical slice of newer, non-MAGA voters. Wiles had criticism for Attorney General Pam Bondi’s handling of the Epstein files, saying she “completely whiffed” by handing out “binders full of nothingness” to MAGA influencers and falsely claiming there was a “client list” on her desk. She also said Trump was wrong to claim that former President Bill Clinton had visited Epstein’s island, telling Whipple: “There is no evidence.”

Wiles also offers blunt assessments of key figures: JD Vance’s transformation she calls “sort of political” and “a conspiracy theorist for a decade.” She said Russell Vought a “right-wing zealot,” and Elon Musk an erratic but unstoppable force whose speed-first governance style left humanitarian wreckage in its wake. Wiles says Musk is an “odd, odd duck” who is not always rational. She described him as “an avowed ketamine” user. Some of his actions left her “aghast.” Yet throughout, Wiles resists framing herself as a corrective to excess. The central question, as the article repeatedly returns to it, is not whether she can restrain Trump — but whether she believes it is her role to do so.

Of note: She referred to Health and Human Services secretary Robert F. Kennedy Jr., another worldclass disrupter, as “my Bobby” and “quirky Bobby.” In Wiles’s view, RFK Jr.’s shock treatment of HHS is warranted. “He pushes the envelope — some would say too far. But I say in order to get back to the middle, you have to push it too far.”

“So much thinking out loud is what I would call it,” said Wiles of Trump’s chaotic tariff rollout. “There was a huge disagreement over whether [tariffs were] a good idea.” Trump’s advisers were sharply divided, some believing tariffs were a panacea and others predicting disaster. Wiles told them to get with Trump’s program. “I said, ‘This is where we’re going to end up. So figure out how you can work into what he’s already thinking.’ Well, they couldn’t get there.” Wiles recruited Vance to help tap the brakes. “We told Donald Trump, ‘Hey, let’s not talk about tariffs today. Let’s wait until we have the team in complete unity and then we’ll do it,’ ” she said. But Trump barreled ahead, announcing sweeping “reciprocal” tariffs, from 10 to 100 percent — which triggered panic in the bond market and a sell-off of stocks. Trump paused his policy for 90 days, but by that time the president’s helter-skelter levies had given rise to the TACO chant: “Trump Always Chickens Out.” Wiles believed a middle ground on tariffs would ultimately succeed, she said, “but it’s been more painful than I expected.” At the time this article went to press, shortly before the December holidays, a Harvard poll showed 56 percent of voters think Trump’s tariff policies have harmed the economy.

Given voters’ anxiety about the cost of living, Wiles said she thought Trump should pivot more often from world affairs to kitchen-table issues. “More talks about the domestic economy and less about Saudi Arabia is probably called for,” said Wiles. “They like peace in the world. But that’s not why he was elected.”

Regarding a gaping hole where the East Wing had been, Whipple asked Wiles about the fierce criticism that followed its demolition to make way for Trump’s 90,000-squarefoot ballroom. “Were you surprised by it?” “No,” Wiles replied. “Oh, no. And I think you’ll have to judge it by its totality because you only know a little bit of what he’s planning.” Was she saying that Trump was planning more, as yet undisclosed renovations? “I’m not telling.”

Trump’s team was divided on whether Putin’s goal was anything less than a complete Russian takeover of Ukraine. “The experts think that if he could get the rest of Donetsk, then he would be happy,” Wiles told Vanity Fair in August. But privately, Trump wasn’t buying it — he didn’t believe Putin wanted peace. “Donald Trump thinks he wants the whole country,” Wiles told Whipple.

Wiles says she’d originally planned to serve as chief for six months. “I have not had a day I would describe as overwhelming, though there’s plenty of frustration here. But you go to bed at night, you say your prayers, and you get up and do it again.” Whipple asked her about her health and the president’s. “Mine is good,” she said. “His is great. My kids are grown. I’m divorced. This is what I do if I stay four years.” Is Wiles really irreplaceable, as Rubio said? “Not patting myself on the back, but just recognizing the reality of this president at this time,” she said, “I’m just not [sure] who else could do this.” In August Whipple asked her if she felt she would outlast her Trump predecessors. “As long as I still feel honored to do it, and I feel like things are going well, we’re moving the country forward positively,” she’d said. “It’s two steps forward, one step back. I get that. But it’s two steps nobody else could make.”

Wiles said Trump has been clear-eyed about what he wanted to do, “having not been there for four years and [having] had time to think about it.” And therefore she can pick her battles. “So no, I’m not an enabler. I’m also not a bitch. I try to be thoughtful about what I even engage in. I guess time will tell whether I’ve been effective.”

The Vanity Fair article ends with this: “As the 2026 midterm elections approach, the stakes for Trump and his chief of staff couldn’t be higher. Trump’s second term has been more consequential than his first. He could leave office as a transformational president who sealed the southern border, passed major tax cuts, brought peace to Gaza, and re-created the GOP in his image. Or he could pursue reckless vendettas, shred democratic guardrails, and end up in the crosshairs of Democrat-led investigations. Either way, Wiles may be the thin line between the president and disaster. As one former GOP chief put it, ‘She may be more consequential than any of us.’”

“I think what he meant by that,” writer Whipple told Wiles, “is that we’ve never had a president who governs so much by whim and who depends so much on one person: you.” “Oh, good Lord,” Wiles said. “Trump doesn’t depend on anybody.”

Note: Wiles released the following statement about the interview after it was released: “The article published early this morning is a disingenuously framed hit piece on me and the finest President, White House staff, and Cabinet in history. Significant context was disregarded and much of what I, and others, said about the team and the President was left out of the story. I assume, after reading it, that this was done to paint an overwhelmingly chaotic and negative narrative about the President and our team. The truth is the Trump White House has already accomplished more in eleven months than any other President has accomplished in eight years and that is due to the unmatched leadership and vision of President Trump, for whom I have been honored to work for the better part of a decade. None of this will stop our relentless pursuit of Making America Great Again!” White House press secretary Karoline Leavitt quickly backed Wiles in her own post on X, saying Trump has “no greater or more loyal advisor than Susie.” “The entire Administration is grateful for her steady leadership and united fully behind her,” Leavitt wrote.

President Trump gave an interview to the New York Post in which he defended her and expressed a shoulder-shrugging nonchalance regarding her remarks about his mindset. He twice described Wiles as “fantastic.”

Meanwhile, the New York Times appeared to have received an early look at the Vanity Fair story. In a Tuesday morning article, reporter Peter Baker noted that the previous day Wiles, in an interview with the Times, “took issue with the quote attributed to her about [Elon Musk’s] drug use.” Wiles told the New York Times the quote was “ridiculous” and that “I wouldn’t have said it and I wouldn’t know.” However, “Whipple played a tape for the Times in which she could be heard saying it,” Baker wrote.

FOOD POLICY & FOOD INDUSTRY

—Trump administration orders rapid SNAP recertification in Minnesota amid fraud clash

USDA demands accelerated eligibility checks in Twin Cities counties, escalating tensions with Gov. Tim Walz over oversight and compliance

The Trump administration is forcing Minnesota to rapidly recertify more than 2 million participants in the nation’s largest food aid program, dramatically escalating a political and administrative clash with Gov. Tim Walz over fraud and program oversight. USDA Secretary Brooke Rollins has ordered the state to launch a one-month “pilot project” to reauthorize SNAP recipients in four Minneapolis–St. Paul area counties, warning that failure to comply could trigger federal penalties, including the withholding of funds.

In a letter sent Tuesday, Rollins directed Minnesota officials to immediately begin accelerated recertification in Hennepin, Washington, Wright, and Ramsey counties. While Minnesota already reauthorizes SNAP eligibility every six to 12 months, the USDA mandate would sharply compress that timeline and require full reverification of citizenship status for all participants in the targeted counties.

Rollins justified the move by citing a $250 million Covid-era fraud scheme involving the Minnesota nonprofit Feeding Our Future, which falsified claims related to federal child nutrition programs. Although the fraud did not involve SNAP funds, the administration is using the case as a basis to argue for tougher scrutiny and enforcement across federal nutrition assistance programs.

Under the order, state administrators must also submit documentation proving that all SNAP participants in the four counties have been reauthorized and that the pilot program requirements were met. Rollins warned that noncompliance would prompt USDA to invoke federal authorities allowing the department—after review by the U.S. attorney general and a federal district court—to withhold funding from the state.

The directive marks one of the most aggressive steps yet by the Trump administration to crack down on perceived fraud in SNAP, and it places Minnesota at the center of a broader fight over federal oversight, administrative burden, and the balance of power between Washington and state governments in administering nutrition assistance.

TRANSPORTATION & LOGISTICS

—China presses for control in Panama ports standoff

Beijing threatens to block a $22.8 billion BlackRock-led acquisition unless state-owned Cosco secures majority control, putting the deal at odds with the White House

A proposed $22.8 billion sale of key Panama Canal ports to a BlackRock-led consortium has stalled after China sharply escalated its demands, insisting that its state-owned shipping giant Cosco receive a controlling stake as a condition for Beijing’s approval. The impasse underscores how strategic infrastructure around the canal is becoming a bargaining chip in broader U.S./China trade and security tensions, according to a Wall Street Journal exclusive.

The deal, announced in March, would transfer ownership of two Panama Canal ports — Balboa and Cristóbal — along with more than 40 ports worldwide from Hong Kong-based CK Hutchison to a group led by BlackRock and Mediterranean Shipping Co. (MSC). It was initially encouraged by the Trump administration, which raised national-security concerns about Chinese influence over canal operations and welcomed a shift toward Western control.

According to people familiar with the talks, Beijing first pushed for Cosco to be included as an equal partner. It has now gone further, threatening to block the transaction unless Cosco gains majority ownership and veto rights over port operations — terms BlackRock and MSC consider unacceptable. The White House has also drawn a red line, signaling it would not support any arrangement that restores Chinese control.

“The President has made clear that Chinese control of the Panama Canal is unacceptable, violates the U.S.-Panama Treaty, and jeopardizes our national and economic security,” a White House official said.

With neither side willing to compromise, participants describe the negotiations as effectively deadlocked. A senior Chinese official indicated that Beijing views control of the ports as leverage in wider negotiations with Washington over trade and tariffs.

In the meantime, Hutchison continues to operate the ports, which handle millions of U.S.-bound containers annually. More than 40% of U.S. container traffic transits the Panama Canal, according to the Panama Canal Authority, making the facilities strategically critical. Hutchison’s ports business has been performing strongly, with revenue up 9% in the first half of 2025 and shares up more than 30% this year.

China’s leverage stems from its regulatory power and commercial reach. Beijing has told the parties it could block the sale if Cosco is excluded, a tactic consistent with past interventions by China’s Commerce Ministry in global mergers. BlackRock and Hutchison both have business interests in China, while MSC is one of the largest carriers of Chinese exports.

Separately, the Panama Canal Authority is moving ahead with plans to auction new port concessions on either side of the canal, a process expected to conclude by January. Major global operators, including APM Terminals and CMA CGM, are preparing bids. Cosco, however, is barred from participating because it is a government entity. The new concessions are expected to generate roughly $500 million in additional annual revenue for the canal authority.

As the BlackRock-Hutchison deal stalls, the episode highlights how control of global ports — and the Panama Canal in particular — has become entangled in great-power competition, with infrastructure deals now serving as pressure points in the wider U.S./China relationship.

LABOR & IMMIGRATION POLICY

—Grassley sees gridlock ahead for H-2A reform as immigration politics harden

Iowa senator says partisan absolutism and White House resistance are blocking even modest changes to farm labor policy

Sen. Chuck Grassley (R-Iowa) warned that meaningful reform of the H-2A agricultural guestworker program remains unlikely, citing entrenched partisan positions in Congress and reluctance from President Trump to advance immigration legislation.

A political divide. Grassley said lawmakers on the right are unwilling to support reforms without mass deportations of undocumented immigrants, while those on the left refuse to back measures that do not include rapid pathways to citizenship — an impasse he described as fundamentally unworkable.

As a result, Grassley said Congress has been limited to making only incremental adjustments, typically by increasing H-2A visa numbers through the annual appropriations process rather than passing stand-alone reform legislation.

He added that prospects for broader action are further constrained by the White House, suggesting the president has little interest in legislative compromise due to the influence of senior adviser Stephen Miller, whom Grassley characterized as a hardline immigration “purist.”

WEATHER

— NWS outlook: Dangerous wind gusts and heavy snow to produce hazardous travel and infrastructure impacts from the Northwest to North-Central U.S…. …Heavy rain likely over portions of the Pacific Northwest beginning Thursday… …Above average temperatures across most of the country today followed by a cooling trend for the Northern Plains/Upper Midwest on Thursday.