WSJ: Trump Tells Aides He’s Willing to End War Without Reopening Hormuz
Perspective on major USDA reports today | Dovish comments from Fed chairman | EPA RIN policy delay could trigger near term feedstock import surge ahead of 2028 shift
| LINKS |
Link: USDA Weighs Phased Reopening of U.S./Mexico Cattle Trade
Amid Screwworm Threat
Link: Video: Wiesemeyer’s Perspectives, March 29
Link: Audio: Wiesemeyer’s Perspectives, March 29
| Updates: Policy/News/Markets, March 31, 2026 |
| UP FRONT |
TOP STORIES
— Mixed war with Iran message, volatile markets: Conflicting signals from President Donald Trump — de-escalation talk vs. continued military threats — are driving headline-driven volatility across oil, equities, and commodities, with risk premiums elevated around the Strait of Hormuz.
— Ag markets react to mixed messaging: Energy-driven biofuel demand is supporting soybean oil, while fertilizer risks and trade uncertainty create choppy, range-bound grain markets and margin pressure for producers.
— EPA RIN policy delay could trigger feedstock import surge: A potential delay of the half-RIN (IRR) policy to 2028 may incentivize near-term imports of foreign feedstocks, pressuring domestic soybean oil before a longer-term shift toward U.S. supply.
— U.S. signals plan to reopen Hormuz: Treasury Secretary Scott Bessent said the U.S. will move to restore oil flows and offset a 10–12 million bpd deficit via SPR releases and global coordination.
— Rubio outlines four Iran objectives: Secretary of State Marco Rubio detailed goals to dismantle Iran’s air, naval, and missile capabilities while warning of escalation targeting energy infrastructure if talks fail.
— China launches symbolic trade probes: The PRC announced new investigations into U.S. trade practices, widely viewed as leverage amid ongoing tariff and supply chain disputes.
HISTORY & WAR WITH IRAN
— Thiessen warns U.S. risks repeating history: Commentator Mark Thiessen argues the U.S. is finally acting on adversaries’ stated intentions, warning past failures to do so led to major global conflicts.
FINANCIAL MARKETS
— Equities today: Futures rose on reports Trump may wind down the Iran campaign, while oil pared gains and global equities showed cautious optimism.
— Equities yesterday: Markets closed mixed with Nasdaq and small caps lagging amid oil-driven inflation fears, while commodities and metals stocks outperformed.
— Powell signals inflation expectations anchored: Fed Chair Jerome Powell said the Fed is in a “wait-and-see” mode, viewing energy shocks as temporary while monitoring private credit stress.
AG MARKETS
— USDA reports loom over markets: Traders expect a shift from corn to soybeans, rising stockpiles, and growing skepticism over USDA data reliability amid declining survey participation.
— Ag markets yesterday: Corn declined while soy complex was mixed; livestock markets were stronger, reflecting uneven commodity performance tied to macro and energy signals.
USDA SECRETARY ROLLINS’ TRACTORCADE
— Rollins takes tractor ride from White House to USDA: Agriculture Secretary Brooke Rollins highlighted U.S. farm heritage with a public tractor ride following a White House agriculture celebration.
ENERGY MARKETS & POLICY
— Tuesday oil update: WTI pulled back to ~$103 as reports of potential de-escalation emerged, though tanker attacks and regional risks persist.
— Monday oil rally: Crude surged above $100 with Brent near $108 as war risks, supply fears, and conflicting U.S.-Iran messaging drove a record monthly gain.
TRADE POLICY
— U.S. shifts away from WTO: USTR Jamieson Greer signaled diminished reliance on the WTO after MC14, pivoting toward bilateral and plurilateral trade strategies.
CONGRESS
— Senate stalls on DHS funding: Republicans are delaying action on a stopgap bill while exploring a reconciliation path for longer-term funding without Democratic support.
WEATHER
— Drought expands across U.S. crop regions: Nearly half the country is in drought, with major impacts across cotton, corn, soybeans, and wheat, raising risks of widespread production losses.
— NWS outlook: Severe storms expected across the Midwest and Northeast, continued warmth in the central U.S., and heavy mountain snow in the Northwest.
| TOP STORIES—Mixed war with Iran message, volatile marketsPresident Trump’s conflicting signals are amplifying volatility across global markets, as investors struggle to reconcile rhetoric pointing toward de-escalation with continued military escalation on the ground. The result is a widening disconnect — one that is driving sharp, intraday swings across energy, equities, and commodities. At the center of the uncertainty is the administration’s dual-track messaging: on one hand, repeated assertions that negotiations with Iran are progressing; on the other, explicit threats targeting critical infrastructure and an ongoing expansion of military operations. That inconsistency is keeping risk premiums elevated, particularly in oil markets tied to the Strait of Hormuz, where even limited disruptions to tanker traffic have outsized global consequences. Crude prices are reacting first and most aggressively, with traders layering in a geopolitical risk premium tied not just to current supply losses, but to the possibility of sudden escalation. Each headline — whether signaling talks or threats — is triggering rapid repositioning, leaving markets headline-driven rather than fundamentally anchored. Equities are showing a similar pattern. Broader indexes are struggling for direction, while sector-level divergence is intensifying — energy and defense names outperforming, while small caps and rate-sensitive sectors lag under the weight of higher input costs and uncertainty. Safe haven flows into bonds and the dollar are also fluctuating as investors recalibrate expectations for inflation and central bank responses. The mixed messaging is also complicating policy expectations. Markets are now forced to price multiple scenarios simultaneously: a near-term de-escalation that could ease oil prices and inflation, versus a prolonged or expanding conflict that would reinforce supply shocks and delay any monetary easing. Now this: U.S. stock futures climbed nearly 1% and oil pared gains Tuesday following a Wall Street Journal report that President Trump signaled to aides a willingness to wind down the U.S. military campaign against Iran — even if the Strait of Hormuz remains largely closed, a scenario that could leave Tehran with greater leverage over the critical energy corridor. The Wall Street Journal reported (link): “In recent days, Trump and his aides assessed that a mission to pry open the chokepoint would push the conflict beyond his timeline of four to six weeks. He decided that the U.S. should achieve its main goals of hobbling Iran’s navy and its missile stocks and wind down current hostilities while pressuring Tehran diplomatically to resume the free flow of trade. If that fails, Washington would press allies in Europe and the Gulf to take the lead on reopening the strait, the officials said.” “There are also military options the president could decide on, but they are not his immediate priority, they said.” Ahead of a tanker attack and the WSJ report, Trump threatened further escalation of its military campaign against Iran. As previously noted, Trump has regularly vacillated between saying a deal with Iran is imminent and warning that he’s prepared to increase the military tempo. Markets also drew support from dovish remarks by Federal Reserve Chair Jerome Powell, who said long-term U.S. inflation expectations remain well anchored despite escalating Middle East tensions, adding that current policy gives the Fed flexibility to evaluate the economic fallout from the conflict (see related item below). In short, the narrative gap between words and actions is becoming the market driver. Until there is alignment — either through verifiable negotiations or a clear shift in military posture — volatility is likely to remain elevated, with the geopolitical risk premium embedded across energy, shipping, and broader financial markets. How the mixed message is impacting ag markets The mixed messaging out of Washington is feeding directly into agricultural market volatility — not through headline reaction alone, but through key transmission channels: energy, inputs, and global trade flows. 1) Energy → biofuels → soybean complex Uncertainty tied to the Strait of Hormuz is keeping crude oil prices elevated and highly reactive. That feeds straight into biofuel economics:• Higher crude = stronger margins for renewable diesel and biodiesel• That boosts demand for soybean oil, tightening the veg oil balance sheet• Soybean futures are finding underlying support, even as broader risk sentiment wobbles Meanwhile, policy uncertainty (RFS, 45Z, potential IRR (half RIN changes) is amplifying the move — traders are layering geopolitical risk on top of already shifting biofuel rules, creating sharper swings in soy oil and crush margins. See next item for more on this topic. 2) Fertilizer and input costs The conflict’s geographic footprint overlaps with a major share of global fertilizer production and export routes:• Nitrogen markets (especially urea) are highly exposed to Persian Gulf exports• Shipping disruptions and war-risk premiums are pushing freight and insurance costs higher• Early moves in NOLA urea and global benchmarks suggest tightening supply For farmers, that creates a familiar squeeze:• Input costs rising without a guaranteed corresponding rally in grain prices• Margin compression risk heading into planting decisions 3) Grain markets caught between support and risk-off Corn and wheat are trading in a tug-of-war:• Bullish forces: higher energy, potential fertilizer constraints, logistical risks• Bearish forces: broader macro uncertainty, stronger dollar at times, and risk-off selling The result is choppy, range-bound trade — with intraday moves increasingly tied to geopolitical headlines rather than traditional fundamentals. 4) Export flows and trade uncertainty Mixed signals from President Trump on negotiations vs. escalation are also clouding export outlooks:• Buyers may delay purchases amid uncertainty over shipping lanes and prices• Insurance and freight costs are rising, particularly for routes tied to the Middle East• Competitors (Brazil, Black Sea suppliers) could gain advantage depending on logistics stability Bottom Line: The ag complex is effectively pricing two conflicting realities at once:• A supply shock environment (supportive prices via energy + inputs)• A demand uncertainty environment (pressure from macro volatility and trade disruption) Until there is clarity — either a credible de-escalation or a sustained disruption — ag markets will remain headline-driven, with soy complex strength, fertilizer volatility, and uneven grain trade defining the landscape. —EPA RIN policy delay could trigger near term feedstock import surge ahead of 2028 shiftUncertainty around Import RIN Reduction (IRR) and alignment with 45Z tax credit raises stakes for biofuel markets, soybean oil demand, and trade flows A potential delay in EPA’s planned Import RIN Reduction (IRR) framework until 2028 is emerging as a key inflection point for biofuel markets — with significant implications for feedstock imports, Renewable Identification Number (RIN) pricing, and domestic crush dynamics. Under current discussions, the EPA’s proposal to effectively assign half-value RINs to imported biofuels or foreign feedstocks — commonly referred to as the “Half RIN plan” — may not take effect until 2028. That delay could create a two-year window (2026–2027) where imported feedstocks retain full RIN generation value, incentivizing a surge in imports. Import incentives could spike before policy shift. Market participants are increasingly focused on the arbitrage opportunity created by the delay. If imported feedstocks continue to qualify for full RIN value through 2027, producers could front-load imports of used cooking oil (UCO), tallow, and other foreign feedstocks to maximize compliance economics. This dynamic would likely:• Increase imports of low-cost feedstocks, particularly from Asia and South America• Put downward pressure on domestic feedstock prices in the near term, especially soybean oil• Potentially distort the intended policy goal of boosting U.S. biofuel production EPA has referred to the framework as IRR, but the market interpretation is straightforward — reduce the competitiveness of imported biofuels and feedstocks over time. Delaying implementation, however, may temporarily do the opposite. 2028 proposal could align with 45Z tax credit structure. Looking ahead, EPA is expected to revisit the IRR framework in its 2028 Renewable Fuel Standard (RFS) proposal, due in June 2026 to meet the statutory timeline for finalization by October 31. A key policy question is whether EPA ultimately aligns IRR with the structure of the 45Z Clean Fuel Production Credit, which already restricts eligibility to biofuels produced from North American feedstocks. If aligned, the combined effect would be significant:• Imported feedstocks would face a double disadvantage — reduced RIN value and ineligibility for 45Z credits• Domestic feedstocks such as soybean oil and canola would gain structural demand support• The U.S. biofuel industry would shift more decisively toward localized supply chains Lower RIN generation rates add another layer. Complicating the outlook further, EPA’s proposal for 2026 and 2027 includes a sharp reduction in RIN generation per gallon of biofuel, with estimates falling to roughly 1.3 RINs per gallon, down from prior assumptions closer to 1.6. This adjustment:• Raises the effective volume requirements for compliance• Tightens supply-demand balances in the RIN market• Amplifies the importance of feedstock sourcing and production efficiency Market and Policy Implications From a market perspective, the combination of lower RIN yields and delayed IRR implementation creates a bifurcated outlook: Near-term (2026–2027):• Increased imports of foreign feedstocks• Potential margin support for renewable diesel producers• Softer domestic feedstock pricing pressure Longer-term (2028 and beyond):• Structural shift toward domestic feedstocks• Stronger support for U.S. soybean oil demand and crush margins• Reduced reliance on imported biofuel inputs Broader perspective. The policy trajectory reflects a broader effort by the Trump administration to re-shore biofuel supply chains, reduce dependence on foreign inputs, and align environmental incentives with domestic production. However, the transition period — particularly the two-year gap before IRR implementation — may introduce volatility and unintended consequences in global feedstock trade flows. For agricultural markets, the stakes are clear: The ultimate structure of IRR and its interaction with 45Z could determine whether the U.S. biofuels expansion becomes a domestically anchored demand engine for soybean oil — or continues to rely heavily on imported alternatives in the interim.—U.S. signals plan to reopen Hormuz as oil deficit widensBessent says Washington will ensure navigation through key chokepoint while tapping global supply and reserves to stabilize markets Treasury Secretary Scott Bessent said the U.S. is preparing to “retake control” of the Strait of Hormuz, outlining a strategy to restore oil flows and stabilize a global market currently facing a significant supply deficit. Speaking on Fox & Friends, Bessent said the global oil market is short roughly 10 to 12 million barrels per day, prompting coordinated efforts by the Trump administration and international partners to backfill supply. He pointed to the largest-ever release from the U.S. Strategic Petroleum Reserve, alongside a coordinated effort by the International Energy Agency to inject roughly 400 million barrels into the market — equivalent to about 4 million barrels per day. Bessent also said the administration has allowed previously sanctioned Russian and Iranian oil already in transit to reach markets, emphasizing that the move does not provide new revenue to those governments but helps ease near-term supply constraints. Despite ongoing tensions tied to the Iran conflict, Bessent indicated that tanker traffic through Hormuz is gradually increasing as countries negotiate temporary arrangements with Tehran. Still, he made clear that the U.S. intends to assert longer-term control over the waterway, potentially through naval escorts or a multinational security effort to guarantee freedom of navigation. On regional risks, Bessent downplayed the threat from Iran-backed Houthi forces, noting their relative inactivity compared to prior periods of escalation. While acknowledging isolated attacks, he suggested the group’s actions remain contained and are unlikely to significantly disrupt broader shipping flows in the near term. The comments underscore a broader U.S. effort to manage both the geopolitical and market fallout from the Iran conflict — balancing military positioning with supply-side interventions to prevent a deeper petroleum driven inflation shock across global economies. —Rubio outlines four military objectives in Iran campaignSecretary of State signals accelerated timeline, hints at internal Iranian fractures and potential escalation if talks fail In a March 30 interview on Good Morning America, Secretary of State Marco Rubio laid out a clear and forceful articulation of the Trump administration’s strategic objectives in the ongoing U.S. campaign against Iran — emphasizing both military benchmarks and emerging diplomatic signals. Four core objectives, accelerated timeline. Rubio framed the operation as narrowly focused and goal-driven, reiterating what he described as President Donald Trump’s original directives: “Number one, the destruction of their air force. Number two, the destruction of their navy. Number three, the severe diminishing of their missile launching capability. And number four, the destruction of their factories so they can’t make more missiles and more drones…” He tied these objectives directly to preventing Iran from developing a nuclear weapon, adding that U.S. forces are “on pace and ahead of schedule” and could achieve these goals “in a number of weeks, not… months.” The remarks underscore a strategy centered on degrading Iran’s conventional and asymmetric military capacity — particularly missile and drone infrastructure — while maintaining a compressed operational timeline. Signals of internal fractures in Iran. In a notable shift, Rubio suggested potential divisions within Iran’s leadership, pointing to backchannel communications: “There are clearly people there talking to us in ways that previous people… have not spoken to us in the past… You have people over there that are saying some of the right things privately.” While declining to identify these interlocutors, Rubio acknowledged “fractures” within the regime, implying that elements inside Iran may be reconsidering their strategic direction amid sustained military pressure. This aligns with broader indications that the conflict may be creating internal strain within Iran’s political and security apparatus — a factor that could influence both battlefield dynamics and diplomatic openings. Escalation risks if talks collapse. Despite the tentative diplomatic signals, Rubio delivered a stark warning about escalation if negotiations fail. He confirmed that the U.S. is prepared to expand targeting to critical infrastructure: “If those discussions don’t yield fruit, the United States will blow up… all of their electric generating plants, all their oil wells and Kharg Island, and possibly all desalinization plants.” The mention of energy and water infrastructure — including Kharg Island, a key oil export terminal — signals a willingness to escalate economic and civilian pressure points to force concessions. Strategic outlook. Rubio’s comments reflect a dual-track approach: rapid military degradation paired with exploratory diplomacy. However, his caution about dealing with a “47-year-old regime” skeptical of peace highlights the administration’s expectation that negotiations may fail. Notably, he declined to comment on whether the conflict could expand geographically — leaving open questions about regional spillover risks, particularly given recent escalations involving proxy groups. Bottom Line: The administration is projecting confidence in achieving near-term military objectives while signaling both internal instability in Iran and a readiness to escalate sharply if diplomatic efforts break down — a combination that keeps markets and geopolitical risk firmly on edge. —More on PRC announcing two new trade probes against the United States. The PRC, in what looks to be a move to try to create leverage to push back on the recently announced U.S. trade investigations to replace the illegal tariffs, on Friday announced new trade probes into “U.S. practices and measures that disrupt global production and supply chains” and “U.S. practices and measures that hinder trade in green products.” Neither is likely to disrupt the current U.S./China trade war pause or Trump’s May 14-15 visit to China. USTR Jamieson Greer dismissed the new probes on X: “We know that these are merely symbolic investigations initiated by China, which is in fact the world’s most profligate disrupter of supply chains and trade in green products. No one is fooled,” said Ambassador Greer. “For the past year, China has disrupted global supply chains with unprecedented restrictions on basic commodity goods such as rare earth elements, fertilizers, and refined fuels. And when it comes to green products, China’s non-market excess capacity has flooded economies with electric vehicles and solar panels to the detriment of workers and manufacturing across the industrialized world. Despite this posturing, the U.S. objective continues to be economic stability and balanced trade with China, in line with the U.S./China deal reached last year in Busan, Korea.” |
| HISTORY & WAR WITH IRAN |
—Thiessen warns U.S. risks repeating history by ignoring declared threats
Washington Post columnist argues Trump strategy reflects lessons from past intelligence failures as Iran tensions escalate
Appearing on Life, Liberty & Levin, Mark Thiessen — a Washington Post columnist and Fox News contributor — delivered a forceful defense of U.S. military strategy against Iran, while warning that the United States has historically failed to act on clearly stated threats from adversaries.
Thiessen argued that the current approach under Donald Trump reflects a break from past failures, particularly in taking hostile rhetoric at face value and acting preemptively.
He pointed to growing concerns about Iran’s ties to terrorist networks, including al Qaeda, and warned that nuclear material could be transferred for use in a “dirty bomb” if not secured. Thiessen emphasized that Iran has long served as a hub for extremist coordination, despite sectarian differences, and suggested the risk is being underappreciated in public discourse.
He also criticized the media and political opposition for downplaying threats and focusing instead on criticizing the administration’s actions, arguing that such narratives risk undermining U.S. strategic objectives during an active conflict.
At the center of his argument was a broader historical warning — that global leaders often clearly signal their intentions, but those warnings are repeatedly ignored until it is too late.
Quote of note: “The biggest mistake American presidents have made for more than a century is we fail to take the words of the enemy seriously. So if you think back to the early 1900s, Vladimir Lenin publishes a pamphlet called What Is to Be Done, in which he lays out his plan to build a communist empire and wage Communist Revolution across the world. No one takes him seriously. The Russian revolution happens. Communism kills 100 million people around the world. Adolf Hitler writes a book called Mein Kampf, in which he declares his intention to build 1000-year Reich and eradicate the Jews. No one takes him seriously. The Nazi regime comes to power, kills 25 million people in 1996. Osama bin Laden publishes a pamphlet in which he said publishes a fatwa declaring war in America and say he’s going to bring war to the United States. No one takes pays attention to him. 911 happens, 2021. Vladimir Putin publishes an essay, it’s still on the presidential website of the Russian presidency, in which he lays out a 6000-word essay explaining that the Russian people and the Ukrainian people are one, and he’s going to reunite them by force, if necessary. No one takes him seriously. He invades Ukraine. The Iranian regime has been saying for decades, death to America, death to Israel, and pursuing a nuclear weapon. And Donald Trump is the first president who took the words of the enemy seriously and is acting to stop them before they kill millions of people.”
Thiessen framed the current military campaign as both strategically precise and historically significant, arguing that it could ultimately be viewed as one of the most consequential U.S. operations if it successfully neutralizes Iran’s nuclear capabilities.
He also took aim at domestic political divisions, asserting that opposition voices are prematurely declaring failure and, in some cases, echoing adversarial narratives. Drawing on his own experience in government, Thiessen stressed that criticism should come after — not during — active military operations involving U.S. troops.
The interview underscored a broader debate shaping U.S. policy: whether pre-emptive action against emerging threats represents necessary realism — or a risky escalation — in an increasingly volatile global landscape.
| FINANCIAL MARKETS |
—Equities today: Equity-index futures rose and oil erased gains after the Wall Street Journal reported that President Donald Trump told aides he’s willing to end the U.S. military campaign against Iran even if the Strait of Hormuz remains largely closed. Futures for the S&P 500 Index climbed 0.8%, while those for European shares rose 0.3% on optimism an end to the conflict may be getting closer. A rebound in Asian shares faded.
—Equities yesterday: U.S. equities closed mixed Monday, with the tech-heavy Nasdaq and small-cap stocks leading the downside as investors navigated escalating geopolitical risks, rising oil prices, and cautious signals from Jerome Powell (see related item below) and Donald Trump.
Risk-off tone driven by oil and war uncertainty. Markets remained on edge as the ongoing U.S./Iran conflict continues to disrupt global energy flows — particularly through the Strait of Hormuz — pushing crude prices higher and reinforcing inflation concerns.
Higher oil prices are feeding renewed inflation fears, complicating the Fed’s policy outlook. Investors are increasingly pricing in a stagflationary risk scenario — slower growth with persistent price pressures. Equity markets, especially growth and rate-sensitive sectors, are reacting negatively to this backdrop. The Nasdaq, heavily weighted toward tech and long-duration assets, is particularly sensitive to rising yields and inflation expectations, explaining its underperformance.
Small caps hit hardest. The Russell 2000 Index underperformed broader markets, reflecting:
• Greater exposure to domestic economic slowdown risks
• Higher sensitivity to financing costs and credit conditions
• Less insulation from global shocks compared to multinational large caps
This divergence signals investors are becoming more defensive, favoring balance sheet strength and global revenue exposure.
Trump commentary adds to volatility. President Trump’s remarks suggesting progress on a potential Iran ceasefire initially supported sentiment, but:
• Ongoing military developments contradicted the optimism
• Markets remain skeptical of a near-term resolution
• Policy uncertainty — including potential escalation or energy intervention — continues to cap upside
Aluminum stocks surge on supply fears. In contrast to broader equity weakness, aluminum and metals stocks rallied sharply:
• Middle East disruptions raised concerns about global supply chains
• Energy-intensive production (like aluminum smelting) becomes more expensive with higher oil and gas prices
• Investors rotated into commodity-linked equities as an inflation hedge
Bottom Line: Markets are increasingly caught between geopolitical escalation and monetary policy restraint:
• Oil is acting as the key transmission channel — driving inflation fears and pressuring equities
• Tech and small caps are bearing the brunt of higher-rate expectations
• Commodities and hard assets are emerging as relative winners
The near-term direction hinges on two variables:
1) Whether the Strait of Hormuz reopens and oil stabilizes
2) Whether Fed policy shifts in response to conflict-driven inflation pressures
Until then, analysts say to expect continued volatility with a defensive tilt across markets.
| Equity Index | Closing Price March 30 | Point Difference from March 27 | % Difference from March 27 |
| Dow | 45,216.14 | +49.50 | +0.11% |
| Nasdaq | 20,794.64 | -153.72 | -0.73% |
| S&P 500 | 6,343.72 | -25.13 | -0.39% |
—Powell signals inflation expectations anchored as Fed monitors war risks and credit stress
Fed remains in “wait-and-see” mode despite oil-driven inflation risks and private credit jitters
Federal Reserve Chair Jerome Powell said Monday that longer-term inflation expectations remain “well anchored,” even as policymakers assess the economic fallout from the escalating U.S./Israel conflict with Iran — a dynamic that is already pushing oil prices higher and complicating the inflation outlook.
Speaking at Harvard University, Powell emphasized that while the central bank is closely monitoring potential spillovers from the war, current policy is appropriately positioned to hold steady. “We don’t know what the economic effects will be,” he said, adding that the Fed is in “a good place” to wait for more clarity before adjusting interest rates.
Quote of note: He argued that energy disruptions tend to be short-lived and that monetary policy’s famously long and variable lags make it a poor fit for addressing the economic dislocations. “By the time the effects of a tightening in monetary policy take effect, the oil price shock is probably long gone, and you’re weighing on the economy at a time when it’s not appropriate. So, the tendency is to look through any kind of a supply shock,” Powell said.
Powell underscored that managing inflation expectations will be critical if energy driven price pressures persist. Oil’s recent surge raises the risk of a stagflationary mix — higher inflation paired with slowing growth — which could intensify tensions between the Fed’s dual mandate of price stability and maximum employment.
Despite those risks, Powell reiterated the Fed’s typical approach to supply shocks: look through temporary price spikes, provided longer-term expectations remain stable. For now, he said, those expectations remain contained beyond the near term.
Markets responded positively to Powell’s comments, with Treasury yields falling and equities moving higher, reflecting investor confidence that the Fed is not preparing an immediate policy tightening response.
Powell also addressed emerging stress in private credit markets, where investor withdrawals and fund restrictions have raised concerns about liquidity. He acknowledged that a correction is underway but stressed that the Fed does not currently see systemic risks.
“We’re watching it super carefully,” Powell said, noting that officials are focused on whether any instability could spread to the banking system. “We don’t see those connections right now.”
The remarks reinforce the Fed’s cautious stance following its recent decision to hold rates steady for a second consecutive meeting, as officials await clearer signals that inflation is sustainably moving toward the 2% target — even as geopolitical shocks threaten to delay that progress.
| AG MARKETS |
—USDA reports loom as markets weigh acreage shifts, stockpiles, and data credibility concerns
Corn-to-soybean rotation, rising inventories, and declining survey participation rates set the stage for a high-stakes crop outlook
The U.S. agricultural markets are bracing for one of the most consequential days of the year as USDA’s National Agricultural Statistics Service (NASS) prepares to release its annual Prospective Plantings report alongside the quarterly Grain Stocks data. This year’s reports arrive at a moment of heightened uncertainty — where geopolitical tensions, rising input costs, and questions about data reliability are all converging to shape expectations for the 2026 crop season.
At the center of market anticipation is a significant shift in planting intentions, with analysts expecting a notable move away from corn and toward soybeans. After corn acreage surged to a 90-year high in 2025, projections suggest a sharp pullback, while soybean plantings are poised to rebound on improved price signals and lower input costs. Fertilizer prices — particularly nitrogen and phosphate — have risen sharply amid the Middle East conflict, further reinforcing the economic incentive to favor soybeans, which require fewer inputs.
Even so, analysts caution that early survey responses may not fully reflect the latest spike in fertilizer costs, leaving room for adjustments as the planting season unfolds.
Wheat acres, meanwhile, are expected to remain under pressure due to persistently weak margins, continuing a trend that has weighed on producer interest in the crop.
On the supply side, the Grain Stocks report is expected to confirm ample inventories across major commodities. Following last year’s record corn harvest, corn stockpiles are projected to climb well above year-ago levels, while soybean and wheat inventories are also expected to increase. Strong wheat disappearance — likely driven by improved export demand — may offer a partial offset, but overall supply levels remain burdensome heading into the new crop year.
Beyond the headline acreage and inventory figures, a deeper concern is emerging around the integrity of the data itself. Analysts are increasingly focused on declining farmer participation rates in USDA and even more so for other government surveys — a trend that threatens the accuracy of official estimates. Response rates have fallen dramatically over the past several decades, and recent staffing reductions within USDA agencies have compounded concerns about data collection and processing capacity, even though some USDA officials have said it has not.
These concerns have been amplified by last year’s series of large revisions to corn acreage estimates, which unsettled markets and raised questions about reliability. Lower participation rates not only reduce statistical accuracy but also risk introducing bias if certain groups of producers are underrepresented — a dynamic that could distort national estimates and market signals.
The broader backdrop adds another layer of volatility. Ongoing geopolitical tensions have pushed crude oil prices sharply higher, increasing production costs while also influencing biofuel demand. This interplay between energy and agriculture markets is adding complexity to planting decisions and market expectations alike.
Upshot: Ultimately, while Tuesday’s reports will provide the first official snapshot of farmer intentions and grain supplies for 2026, market participants remain mindful that these figures are only a starting point. Weather conditions, evolving input costs, and shifting global dynamics will continue to shape the crop outlook in the months ahead — leaving traders to balance immediate data with a high degree of uncertainty.
USDA Prospective Plantings 2026
Pre-Report Analyst Estimates by Crop — March 31, 2026
Compiled from Reuters, Dow Jones, and AgMarket.Net surveys ahead of the USDA report release at 11:00 a.m. CDT (noon ET) on Tuesday, March 31, 2026. All figures in millions of acres (ma). Dashes (—) indicate no estimate available from that source.
| Crop | Reuters Avg. | Dow Jones Avg. | AgMarket.Net | 2025 Actual |
| Corn | 94.371 ma | 94.5 ma | 94.4 ma | 98.788 ma |
| Soybeans | 85.549 ma | 85.5 ma | 86.1 ma | 81.215 ma |
| Spring Wheat | 9.843 ma | — | — | 9.990 ma |
| All Wheat | — | — | 44.7 ma | 45.3 ma |
| Cotton | — | — | ~9.19 ma | ~9.3 ma |
Key notes:
• Reuters and Dow Jones averages are closely aligned on corn (94.371 vs. 94.5 ma) and soybeans (85.549 vs. 85.5 ma).
• AgMarket.Net’s soybean estimate of 86.1 ma is the most bullish, above the Reuters average of 85.549 ma.
• Spring wheat acres of 9.843 ma (Reuters) would be the lowest since 1970.
• Cotton acreage near 9.19 ma would be an 11-year low, though severe drought (88% of production area) remains a bullish counterweight.
• Survey timing caveat: bulk of farmer surveys were returned in early March, before the full impact of the Iran war on fertilizer costs was apparent. Traders are likely to view the report with some skepticism.
—Agriculture markets yesterday:
| Commodity | Contract Month | Closing Price (March 30) | Change from March 27 |
| Corn | May | $4.55 3/4 | -6 1/4 cents |
| Soybeans | May | $11.59 3/4 | +1/2 cent |
| Soybean Meal | May | $314.90 | -$0.40 |
| Soybean Oil | May | 68.47 cents | +106 points |
| SRW Wheat | May | $6.07 | +2 cents |
| HRW Wheat | May | $6.26 1/4 | -6 1/2 cents |
| Spring Wheat | May | $6.52 | +3 3/4 cents |
| Cotton | May | 70.19 cents | +73 points |
| Live Cattle | June | $240.20 | +$1.425 |
| Feeder Cattle | May | $361.325 | +$1.50 |
| Lean Hogs | June | $105.875 | -$0.25 |
| USDA SECRETARY ROLLINS’ TRACTORCADE |
—Rollins takes tractor ride from White House to USDA in Agriculture Celebration
Patriotic Case IH display highlights farm heritage and public outreach effort
USDA Secretary Brooke Rollins marked the White House’s national agriculture celebration on Friday, March 27, with a highly visible gesture, riding a tractor from the South Lawn to USDA and sharing photos of the trip online.
The tractor — a Case IH Magnum 265 built in Racine, Wisconsin — had been showcased earlier in the day as part of the White House event. The custom “Heartland Edition” model, finished in red, white and blue, was designed to commemorate the 250th anniversary of America and honor the country’s farming community.
Following its appearance at the White House, the tractor was relocated to USDA grounds, where it is now on display in the department’s “Voice of the Farmer Garden,” still widely referred to as the People’s Garden. The display underscores a broader effort to elevate public engagement with agriculture and highlight domestic farm production. CNH Industrial, the parent company of Case IH, is a corporate partner supporting the garden, which is currently managed by the Farm Journal Foundation.
Link to photos and videos.
| ENERGY MARKETS & POLICY |
—Tuesday: WTI crude futures retreated to around $103 per barrel, reversing gains from earlier in the session following reports that President Donald Trump told aides he is willing to end the U.S. military campaign against Iran even if the Strait of Hormuz remains largely closed, potentially strengthening Tehran’s control over the strategic waterway.
Meanwhile, Iran struck a Kuwaiti oil tanker near a Dubai port, underscoring heightened risks for shipping in the Persian Gulf. Iran-backed Houthis in Yemen also entered the conflict by targeting Israel over the weekend, while Tehran is reportedly preparing to disrupt Red Sea shipping. These developments could further tighten energy flows from the Middle East, as two of the world’s main trade and energy corridors face potential disruption.
The U.S. oil benchmark remains on track for a record monthly surge of over 50%.
—Monday: Oil rally extends as Iran denies talks, war risks deepen
Crude surges past $100 as conflicting U.S./Iran signals, escalating conflict, and supply fears drive expectations of prolonged high energy prices
Oil prices pushed higher Monday as geopolitical tensions intensified and mixed messaging between Washington and Tehran added uncertainty to already strained global energy markets.
Iran’s foreign ministry denied that any direct negotiations with the U.S. had taken place during the conflict, contradicting statements from President Donald Trump and the White House. In a translated post, Tehran said intermediaries — including Pakistan — had conveyed proposals, but no formal talks had occurred. Hours later, White House Press Secretary Karoline Leavitt maintained that discussions to end U.S. military operations were “continuing and going well,” underscoring a widening disconnect between the two sides.
The conflicting signals come as energy markets react primarily to supply risks rather than diplomacy.
Brent crude climbed to $108.59, up from $106.38 on Friday.
West Texas Intermediate (WTI) surged to $105.00 from $100.11.
Both benchmarks now up more than 50% for the month and on track for their largest gains in years. Forward curves also reflect tightening conditions, with three-month Brent futures nearing $101, suggesting markets expect elevated prices to persist.
The rally is being fueled by both rhetoric and real escalation. President Trump warned that failure to reopen the Strait of Hormuz could trigger U.S. strikes on Iran’s critical infrastructure, including oil facilities and power plants. Over the weekend, the conflict expanded as Iran-backed Houthi forces entered the war, raising fresh concerns about disruptions to Red Sea shipping lanes and broader regional energy flows.
Market participants are increasingly pricing in a longer-duration conflict with material supply constraints. Analysts warn that the combination of potential U.S. ground operations, threats to key transit chokepoints, and heightened risks to infrastructure could sustain upward pressure on crude.
Policy signals are also contributing to volatility. Reports indicate the administration is considering more aggressive military options — including operations inside Iran — while Trump has floated the idea of seizing Iranian oil assets.
Separately, the U.S. appears to be easing pressure on oil flows to Cuba, with a Russian tanker delivering 100,000 tons of crude to the island, signaling selective flexibility in enforcement.
At the consumer level, the impact is already visible. U.S. gasoline prices have climbed to an average of $3.99 per gallon, nearly $1 higher than pre-war levels. The White House has characterized the spike as temporary, but markets are increasingly skeptical, with futures curves and risk premiums suggesting oil could remain elevated if the conflict continues or escalates further.
The broader takeaway is clear: even as diplomatic messaging remains inconsistent, markets are anchoring to the physical risks — and pricing in a scenario where energy supply disruptions, not negotiations, define the near-term outlook.
| TRADE POLICY |
—U.S. signals shift away from WTO after MC14 disappointment
USTR Greer cites lack of progress and engagement, pivots toward bilateral and plurilateral trade strategies
U.S. Trade Representative (USTR) Jamieson Greer said the outcome of the 14th WTO Ministerial Conference reinforced Washington’s view that the World Trade Organization will play only a “limited role” in shaping future global trade policy, marking a continued shift in U.S. trade strategy.
In remarks following the ministerial meeting in Yaoundé, Cameroon, Greer pointed to what he described as a “lack of seriousness” among WTO members, including low attendance by key ministers and an inability to reach consensus on core issues. The conference concluded without agreement on renewing the long-standing moratorium on e-commerce duties or advancing a broader reform agenda — both seen as critical tests of the institution’s relevance.
At issue is the WTO’s moratorium on customs duties for electronic transmissions — a cornerstone of global digital trade since 1998. The measure, which prevents countries from imposing tariffs on cross-border data flows such as software, streaming, and digital services, has been repeatedly renewed but is now increasingly contested by developing countries seeking new revenue streams and policy flexibility.
Greer emphasized that the U.S. had spent months pushing for reforms but came away disappointed, arguing that the WTO’s inability to deliver outcomes — even on widely supported issues like digital trade — underscores its diminishing utility. He called the failure to extend the e-commerce moratorium “particularly frustrating,” noting that a small number of countries blocked progress despite revised U.S. proposals.
In response, the U.S. is increasingly turning outside the WTO framework. Greer said Washington will pursue alternative paths, including bilateral agreements and plurilateral deals among like-minded countries, to maintain duty-free digital trade flows. The U.S. has already been securing commitments from trading partners to uphold such rules independently of the WTO.
Implications for global trade and ag markets. The breakdown carries significant implications beyond the tech sector:
•Digital trade fragmentation risk: Without a global moratorium, countries could begin imposing tariffs on data flows, increasing costs for U.S. firms and complicating cross-border commerce.
•Precedent for broader tariff policy: The willingness to bypass the WTO aligns with ongoing U.S. efforts to rebuild tariff authority through alternative legal mechanisms (e.g., Section 122, Section 301, Section 232).
•Agriculture and supply chains: While not directly targeted, ag exporters rely heavily on digital infrastructure — logistics platforms, trading systems, and market data flows. Fragmentation or added costs in digital trade could indirectly raise transaction costs and reduce efficiency across commodity markets.
Meanwhile, U.S. Ambassador to the WTO Joseph Barloon indicated that Washington would remain engaged in Geneva, particularly on reform discussions, but acknowledged the institution’s structural limitations. He reiterated that while some members showed constructive engagement, entrenched divisions continue to hinder meaningful progress.
The outcome of MC14 highlights a broader trend: the erosion of multilateral consensus in global trade governance and the growing U.S. preference for flexible, coalition-based approaches — a shift with significant implications for trade rules, dispute resolution, and market access moving forward.
| CONGRESS |
—Senate stalls on DHS funding as GOP eyes reconciliation path
Shutdown drags on with no immediate vote as Republicans signal shift toward long-term funding strategy without Democratic support
The Department of Homeland Security (DHS) remains shut down with little urgency in the United States Senate to resolve the impasse, as lawmakers held only a brief pro forma session and declined to take up a House-passed 60-day stopgap funding bill.
Sen. John Hoeven (R-N.D.) said Republicans are holding off because negotiations are still underway, even as lawmakers head are in a two-week recess. However, his comments pointed to a broader strategic shift rather than active bipartisan talks. Hoeven indicated that GOP leadership is now pursuing a longer-term approach — potentially funding DHS for up to three years through the budget reconciliation process, which would allow passage with a simple majority and bypass Democratic opposition.
“We’re not going through this with the Dems,” Hoeven told reporters. “We’re working on reconciliation now. We’re taking this off the table.”
The remarks underscore a deepening partisan divide over DHS funding and suggest that near-term reopening prospects remain uncertain.
Despite the ongoing shutdown, some operational pressures have begun to ease. Most Transportation Security Administration (TSA) agents received pay on Monday after weeks of disruption, and major airport bottlenecks — including those at Baltimore and Houston — have improved significantly, signaling partial stabilization even as the broader funding standoff persists.
| WEATHER |
— Drought expands across key U.S. crop regions
From the Colorado River Basin to the Southern Plains, drought now covers a growing share of U.S. farmland — with cotton, wheat, corn, and soybean regions increasingly affected
Drought conditions are no longer confined to the western U.S. — they now span a significant portion of the country’s agricultural footprint, with both state-level coverage and crop-specific exposure rising sharply heading into the 2026 growing season.
National drought footprint. Across the U.S., roughly 46% of the country is currently in drought (D1–D4), with about 73% experiencing at least abnormally dry conditions (D0–D4).
This broad footprint underscores how widespread moisture deficits have become — stretching from the Rockies through the Plains and into the Southeast.
Crop-specific drought exposure. The most striking data point for agricultural markets is how deeply drought has penetrated major crop production areas:
• Cotton: ~89% of U.S. cotton production area is in drought
• Corn: ~51% of U.S. production area in drought
• Soybeans: ~53% of production area in drought
• Rice: ~80% of production area in drought
• Peanuts: ~94% of production area in drought
These figures confirm that drought is not isolated — it is affecting multiple major commodity groups simultaneously, increasing the risk of correlated supply shocks.
Texas: Ground zero for cotton risk. Texas — the largest U.S. cotton-producing state — is entering planting season under persistent dryness:
• Large portions of the state remain under ongoing drought conditions tied to La Niña patterns
• Drought is widespread across the Southern Plains, with impacts already seen in rangeland, soil moisture, and water supplies
While precise statewide percentages vary week to week, drought coverage across key Southern Plains states is extensive. For example:
•Oklahoma: ~94% of the state in drought in recent readings
Given similar weather patterns, Texas is experiencing comparable broad-scale dryness, especially in cotton-producing regions like the High Plains.
Wheat belt: Plains dryness intensifying. Drought is also increasingly evident across Hard Red Winter wheat regions, particularly:
• Kansas
• Oklahoma
• Texas
• Eastern Colorado
Key signals include:
• Persistent drought expansion across the Southern Great Plains since winter
• Soil moisture declines already impacting wheat condition ratings and yield potential
• Heat and dryness continuing to degrade crop prospects heading into spring development stages
While Kansas wheat condition ratings still show a majority in good-to-excellent condition (~58%), deterioration is underway as moisture deficits build.
Regional drought concentrations. Current hotspots include:
• Western U.S.: Colorado River Basin, Utah, Wyoming — critically low snowpack and reservoir stress
• Southern Plains: Texas, Oklahoma — widespread drought impacting cotton, wheat, and livestock
• Southeast: Florida, Georgia, Carolinas — severe to extreme drought expanding
Market implications: synchronized crop stress. The significance of these percentages is not just scale — it’s synchronization:
• Cotton, grains, and specialty crops are all simultaneously exposed
• Drought spans both irrigated (West) and rainfed (Plains/South) systems
• Risk is elevated for:
- Cotton abandonment in Texas
- Wheat yield losses in the Plains
- Feed grain tightening if corn/soy stress persists
Bottom Line: With nearly half the country in drought and major crop regions showing 50%–90%+ exposure, the 2026 growing season is shaping up as a broad-based weather risk event, not a localized issue.
The next 30–60 days of precipitation — particularly across Texas and the Plains — will be critical in determining whether these percentages stabilize… or translate into meaningful production losses across multiple U.S. commodities.
—NWS outlook: A cold front is set bring strong to severe thunderstorms in the Midwest, Great Lakes, and parts of the Northeast Tuesday… …Above-average temperatures expected to continue for much of the central
and southern U.S. to start the week, before a brief cooldown begins in the
Northern Plains midweek… … A strong upper-level low moving through the Northwest will bring heavy mountain snow along the mountainous regions.
