Beijing Confirms First Visit by a U.S. President Since 2017 as Trump and Xi Prepare High-stakes Summit May 13-15

Year-round E15 | Meatpacker investigations | Fertilizer updates | Colorado River crisis deepens | Trump admin. regulations ahead

Link: The Week Ahead, May 10: Congress Returns as Key Issues Mount
Link: Weekend Updates, May 9: Wildfires Surge Across U.S. as
          Drought Raises Fears of Severe Summer

Link: Video: Wiesemeyer’s Perspectives, May 9
Link: Audio: Wiesemeyer’s Perspectives, May 9

Topics discussed: 

1. Weekly Markets
2. Argentine soyoil discount to U.S. hits decade low
3. 2026 Wheat Quality Council’s HRW Tour May 11-13
4. Iran war ceasefire? 
5. Tuesday: Crop Report & WASDE
6. Congress returns… Wed.: Year-round E15 Vote in House?
7. Thur./Fri.: Trump/Xi summit in Beijing
8. Another negative court ruling on Trump tariffs
9. Tariff refunds begin
10.  More ag disaster and farmer aid?
11.  $1 bil. farmer bridge payments for specialty crops/sugar this week?
12.  Trump investigation of meat packers/ Agri Stats case 
13.  Fertilizer hearing in Senate Ag Committee Tue., May 12
14.  Trump met with Brazil’s President Lula 
15.  Politics: Va. Supreme Court rejects state redistricting effort
     

TOP STORIES
 

— Trump rejects Iran proposal, extending Hormuz standoff: President Donald Trump rejected Iran’s latest peace proposal response, prolonging uncertainty surrounding the Strait of Hormuz as drone attacks, shipping disruptions, and energy market volatility continue across the Gulf region.

— Beijing confirms first visit by a U.S. president since 2017 as Trump and Xi prepare high-stakes summit: China confirmed President Donald Trump will visit Beijing May 13-15 for a major summit with Chinese President Xi Jinping focused on trade, energy security, tariffs, and geopolitical tensions.

— U.S./China teams hold final preparatory talks ahead of Trump/Xi summit: Treasury Secretary Scott Bessent and Chinese Vice Premier He Lifeng are holding advance negotiations in South Korea aimed at finalizing potential agreements ahead of the Trump/Xi summit.

— Trump/Xi summit set for high-stakes talks in Beijing: The White House outlined a packed diplomatic schedule for President Donald Trump’s Beijing visit as trade, Taiwan, agriculture, energy, and Iran dominate the bilateral agenda.

— Trump/Xi summit carries high stakes for trade, Taiwan and U.S./China rivalry: A Wall Street Journal editorial warned the administration against mistaking short-term stability with Beijing for long-term strategic alignment as tensions over Taiwan, AI, and trade persist.

— U.S./China Trade Board proposal signals push for managed commerce: The Trump administration is exploring a new “Board of Trade” framework that could oversee tens of billions of dollars in bilateral commerce involving agriculture, energy, and aerospace.

— House set for high-stakes E15 vote amid fuel price surge: House lawmakers are preparing to vote on nationwide year-round E15 gasoline sales as ethanol supporters and refiners clash over fuel costs, refinery burdens, and corn demand.

— Trump administration regulatory agenda faces delays on key food and biofuel policies: Key Trump administration rules involving ultra-processed foods, 45Z biofuel guidance, and 2028 Renewable Fuel Standard volumes remain delayed pending regulatory review.

— Colorado River crisis deepens as states struggle to reach long-term water deal: Western states are scrambling to stabilize the Colorado River system as drought, low snowpack, and structural overuse intensify water shortages across the region.
 

FINANCIAL MARKETS
 

— Equities today: U.S. equity futures were little changed as investors weighed stalled Iran ceasefire negotiations, higher oil prices, and stronger-than-expected Chinese inflation data.

— Markets rally, but Sevens Report warns risks remain beneath the surface: Sevens Report cautioned that stagflation risks, possible Federal Reserve tightening, and a slowdown in AI spending could eventually threaten the current market rally.
 

AG MARKETS
 

— USDA daily export sales: USDA reported new corn export sales to Mexico and South Korea for the 2025/26 and 2026/27 marketing years.

— International grain prices firm ahead of USDA reports: Global grain markets traded firmer as weather threats, geopolitical tensions, and higher crude oil prices supported wheat, corn, and oilseed futures.

— Overnight U.S. grain markets: Grain futures finish firmer as soybeans and wheat lead overnight gains: Soybeans and wheat led overnight gains as traders positioned ahead of USDA reports and monitored U.S. weather developments.

— Funds build record bullish bets across grain markets: Managed money funds established record net long positions in grains and oilseeds amid tightening supply concerns, strong demand expectations, and geopolitical risk.
 

FERTILIZER
 

— Sulfur spike raises new alarm for global fertilizer markets: Sulfur futures surged to record highs as Middle East disruptions tightened fertilizer supply chains and raised concerns about phosphate fertilizer availability.

— Fertilizer, fuel spike adds fresh pressure to farm margins: Southern Ag Today analysis showed rising diesel and fertilizer costs are significantly increasing production expenses for U.S. farmers.
 

MEATPACKER INVESTIGATIONS
 

— Echoes of the beef trust era resurface in today’s meatpacking debate: Historical comparisons to Theodore Roosevelt’s early 1900s “beef trust” investigations are fueling renewed debate over consolidation and pricing power in the modern meatpacking industry.
 

ENERGY MARKETS & POLICY
 

— Oil prices surge again as Iran talks stall and Hormuz risks persist: Crude oil prices rallied sharply after President Donald Trump rejected Iran’s latest proposal, renewing fears of prolonged supply disruptions through the Strait of Hormuz.

— California’s fuel crunch deepens as Middle East oil shipments halt: The Wall Street Journal reported California faces worsening fuel shortages and soaring prices as Middle Eastern crude shipments remain disrupted.

— Ethanol fight splits GOP as E15 vote nears: A Wall Street Journal editorial criticized ethanol interests for pressuring House Republicans ahead of a standalone E15 vote, while supporters argued the policy supports rural economies and fuel choice.

TRADE POLICY

— Trade court ruling deepens legal uncertainty around Trump tariff strategy: The Trump administration appealed a court ruling blocking use of Section 122 tariffs, adding uncertainty to the White House’s broader trade agenda.

CHINA

— China’s EV export boom accelerates amid rising oil prices: China exported more electric and plug-in hybrid vehicles than gasoline-powered vehicles for the first time, highlighting its growing dominance in global EV markets.

— China inflation picks up as energy shock offsets weak food prices: China’s April inflation accelerated above expectations as rising energy and transportation costs linked to Middle East tensions offset weak food prices.

POLITICS & ELECTIONS

— Southern redistricting battle escalates after Supreme Court ruling: Republican-led Southern states are aggressively pursuing new congressional maps following a Supreme Court ruling on Louisiana redistricting.

WEATHER

— NWS outlook: The National Weather Service warned of marginal risks for severe thunderstorms in the Southeast and excessive rainfall along portions of the Central Gulf Coast.

— U.S. weather pattern splits Corn Belt, Plains as heat accelerates planting before wetter shift: Hot, dry weather is accelerating planting across parts of the Midwest and Plains before a wetter pattern develops later in the forecast period.

— Brazil safrinha corn forecast splits sharply between drought stress and frost risk: Northern Brazil’s safrinha corn areas face worsening heat and drought stress while southern regions confront short-term frost threats before rainfall returns.
 

TOP STORIES—Trump rejects Iran proposal, extending Hormuz standoffU.S. dismissal of Tehran’s latest response prolongs uncertainty in the Gulf as drone attacks escalate, though limited LNG transit signals fragile diplomatic openingsPresident Donald Trump on Sunday sharply rejected Iran’s latest response to Washington’s proposed framework for ending the war, calling Tehran’s counteroffer “totally unacceptable” and signaling that the administration believes Iran failed to address core U.S. demands tied to its nuclear program. According to reporting from the Wall Street Journal, the White House concluded that Iran’s reply did not provide sufficient guarantees on uranium enrichment, weapons-related activities, or long-term verification measures. The rejection effectively extends the uneasy strategic stalemate that has gripped the Strait of Hormuz since the outbreak of the conflict. While direct large-scale military exchanges between the United States and Iran have eased in recent weeks, the region remains highly volatile, with shipping security and energy infrastructure still under threat. Markets had hoped the latest diplomatic exchanges might produce at least a partial de-escalation agreement capable of stabilizing global oil and liquefied natural gas flows. Instead, Trump’s comments reinforce expectations that negotiations could drag on for weeks or months. Meanwhile, tensions across the Gulf intensified over the weekend. The United Arab Emirates, Kuwait, and Qatar all reported attacks involving Iranian drones, underscoring Tehran’s continued willingness to project pressure across the region even while negotiations remain active. One maritime strike reportedly ignited a vessel temporarily, highlighting the persistent risks facing commercial shipping routes moving through or near Hormuz. Although the damage appeared limited, the incidents reinforced concerns among insurers, shipping firms, and energy traders that the conflict remains capable of rapidly escalating again. Meanwhile, there were tentative signs of diplomatic maneuvering aimed at preventing a complete collapse in Gulf energy exports. A Qatari liquefied natural gas cargo successfully transited the Strait of Hormuz over the weekend — the first such LNG shipment to do so since the war began. The passage followed discussions involving Iran, Qatar, and Pakistan, suggesting regional actors are attempting to carve out limited safe-passage arrangements even as broader political negotiations remain deadlocked. That development is significant because Qatar remains one of the world’s largest LNG exporters, and prolonged disruptions to its shipments could have major implications for Europe and Asia, both of which rely heavily on Gulf energy supplies. The successful transit may indicate Tehran is willing to selectively tolerate some commercial flows in order to avoid fully alienating neighboring Gulf states or triggering a wider international backlash. Still, the broader outlook remains highly uncertain. The Trump administration continues to insist that any final agreement must impose strict constraints on Iran’s nuclear activities and regional military posture. Tehran, meanwhile, appears focused first on securing a cessation of hostilities and limiting further economic and military pressure before making broader concessions. That gap remains substantial. The continued impasse also keeps energy markets on edge. Even without a formal closure of the Strait of Hormuz, persistent drone attacks, maritime incidents, and military signaling are increasing shipping costs, insurance premiums, and logistical uncertainty throughout the region. Traders increasingly view the situation not as a short-term disruption but as a prolonged geopolitical risk event capable of reshaping global energy and commodity flows well into the second half of 2026.—Beijing confirms first visit by a U.S. president since 2017 as Trump and Xi prepare high-stakes summitThe Chinese government confirmed Monday that President Donald Trump will travel to Beijing from May 13-15 for a state visit hosted by Chinese President Xi Jinping, marking the first trip to China by a U.S. president since 2017. The announcement comes as Washington and Beijing attempt to stabilize relations amid mounting geopolitical and economic pressures, according to the South China Morning Post. China’s Foreign Ministry said the visit was made at Xi’s invitation and will include multiple bilateral meetings, ceremonial events and extended discussions on trade and economic issues. The summit unfolds against the backdrop of elevated U.S./China tensions over trade, technology, security and supply chains, while the fragile ceasefire tied to the Iran war and continuing disruptions in the Strait of Hormuz are adding new strain to the global economy. White House Principal Deputy Press Secretary Anna Kelly said Sunday that Trump would arrive in Beijing on Wednesday evening for what she described as a visit of “tremendous symbolic significance.” According to the White House schedule, Trump and Xi are expected to participate in a formal welcome ceremony and bilateral talks on Thursday, followed by a visit to Beijing’s Temple of Heaven and a state banquet. The two leaders are also scheduled to hold additional discussions Friday during a bilateral tea meeting and working lunch before Trump departs China. Kelly added that the United States intends to host Xi for a reciprocal visit later this year. The summit comes as both governments attempt to maintain economic dialogue despite growing strategic rivalry. Chinese officials announced that Vice Premier He Lifeng will travel to South Korea for trade talks with U.S. Treasury Secretary Scott Bessent on May 12-13 in what both sides described as the final round of economic negotiations ahead of Trump’s arrival in Beijing. China’s Commerce Ministry said the discussions would be guided by prior agreements reached between Trump and Xi and would focus on “economic and trade issues of mutual concern.” The timing underscores how trade negotiations remain central to the broader diplomatic effort even as energy security and Middle East instability increasingly shape the bilateral agenda. The visit also highlights how the Iran conflict has become intertwined with U.S./China relations. Continued tensions around the Strait of Hormuz — a critical artery for global oil and LNG shipments — have driven up energy costs and complicated global supply chains. Analysts increasingly expect those issues to feature prominently in discussions between Washington and Beijing given China’s heavy dependence on imported energy and the Trump administration’s broader effort to reshape global trade and industrial relationships. —U.S./China teams hold final preparatory talks ahead of Trump/Xi summitBessent/He meeting in South Korea seen as key step toward potential Beijing deliverablesAccording to Trivium China, senior U.S. and Chinese officials will hold last-minute negotiations in South Korea on May 12-13 ahead of President Donald Trump’s upcoming state visit to Beijing, with Treasury Secretary Scott Bessent and Chinese Vice Premier He Lifeng leading the discussions. The talks are widely viewed as an effort to finalize the framework for potential agreements before Trump meets Chinese President Xi Jinping later this week. Trivium noted that Bessent and He played a similar advance role before the October summit in Busan, where preliminary negotiations helped establish the foundation for broader leader-level understandings. Analysts expect this week’s discussions to again function as the real negotiating venue, allowing both sides to narrow differences and lock in deliverables before the higher-profile summit begins. The agenda is expected to be expansive and highly sensitive. Officials are reportedly discussing the growing network of bilateral sanctions, trade investigations, and tariff disputes that continue to weigh on economic relations. AI governance and safety guardrails are also expected to feature prominently as both countries attempt to manage intensifying technological competition while avoiding escalation in strategic sectors. Geopolitical tensions surrounding the Iran war are likely to play a central role as well. Washington is expected to press Beijing to use its leverage with Tehran to help stabilize the region and protect global energy flows through the Strait of Hormuz. Meanwhile, possible adjustments to U.S. language surrounding Taiwan could emerge as another sensitive negotiating point ahead of the summit.Trade and commercial incentives are also reportedly under consideration. Potential Chinese purchases of U.S. agricultural commodities, aircraft, and energy products are being discussed as possible “sweeteners” designed to demonstrate tangible progress and stabilize bilateral ties. Such measures could provide political and economic wins for both governments while easing some market concerns over deteriorating U.S./China relations. The late-stage diplomacy is being interpreted by analysts as a constructive signal that both sides want the Beijing summit to produce substantive outcomes rather than symbolic optics alone. By resolving difficult technical issues in advance, negotiators may reduce pressure on direct Trump/Xi interactions and improve the odds of announcing concrete agreements during the visit.—Trump/Xi summit set for high-stakes talks in BeijingWhite House details packed schedule as trade, Taiwan, energy, and Iran loom over bilateral meeting The White House said President Donald Trump will hold a formal summit with Chinese President Xi Jinping on Thursday morning in Beijing, capping weeks of anticipation surrounding one of the most consequential U.S./China meetings since Trump returned to office. Trump is scheduled to arrive in Beijing on Wednesday evening before beginning a tightly choreographed series of diplomatic events with Xi the following day. White House Deputy Press Secretary Anna Kelly said the summit schedule includes a tour of Beijing’s historic Temple of Heaven alongside Xi and a state banquet Thursday evening, underscoring Beijing’s effort to present the visit as both ceremonial and strategically important. Trump will also participate in a working lunch with Xi on Friday before departing China later that day. The summit comes at a critical moment for both governments as they attempt to stabilize an increasingly strained relationship shaped by trade disputes, technology restrictions, Taiwan tensions, and the economic fallout from the Iran war and disruptions in the Strait of Hormuz. Administration officials and analysts expect the talks to focus heavily on extending the fragile U.S./China trade truce, expanding Chinese purchases of U.S. agricultural goods and aircraft, and easing tensions surrounding export controls and critical minerals. Agriculture and energy markets are expected to closely monitor the meeting for signals of renewed Chinese purchases of U.S. soybeans, corn, pork, other farm commodities and liquefied natural gas. Reports ahead of the summit have suggested Beijing could consider major Boeing aircraft purchases and additional commodity buying commitments as part of broader efforts to reduce trade friction with Washington ahead of the July U.S.-Mexico-Canada Agreement review and ongoing tariff disputes. (For more details, see the next item after the box item below.) Enforcement of any Chinese purchase commitments will be a key issue ahead. Taiwan is also expected to emerge as one of the most sensitive issues during the talks. Chinese officials have repeatedly described Taiwan as a “core interest,” and Beijing is likely to press the Trump administration for stronger assurances against support for Taiwanese independence. U.S. officials, meanwhile, have indicated there will be no formal shift in longstanding American Taiwan policy. Meanwhile, the Iran conflict and the security of the Strait of Hormuz are likely to shape discussions behind closed doors. Washington has been pushing Beijing to use its influence with Tehran to help stabilize shipping lanes and reduce risks to global energy markets. China, which remains heavily dependent on Middle Eastern energy flows, also has strong incentives to avoid prolonged instability in the region, particularly after recent attacks on commercial shipping linked to the broader conflict. The summit is widely viewed as an attempt to prevent further deterioration in ties between the world’s two largest economies while creating narrowly targeted agreements that could calm markets and reduce geopolitical tensions without producing a broader strategic reset.  Trump/Xi summit carries high stakes for trade, Taiwan and U.S./China rivalryWall Street Journal editorial warns against mistaking “stability” for strategic alignment with Beijing The editorial board of the Wall Street Journal argued Sunday that President Donald Trump’s upcoming summit with Chinese President Xi Jinping in Beijing represents far more than a routine diplomatic meeting, warning that the White House’s push for “stability” risks underestimating Beijing’s long-term strategic ambitions.  According to the opinion piece, the summit agenda spans trade, technology, Taiwan and Iran, but the publication cautioned that personal diplomacy with Xi cannot erase what it described as China’s broader anti-American objectives. The editorial stated that “Mr. Xi is playing a long game to overthrow the U.S. as the world’s leading power,” framing the summit as part of a much larger geopolitical contest. On trade, the Journal suggested the most realistic outcome may simply be preserving the current tariff truce while seeking assurances that Beijing will not again weaponize rare-earth exports. The editorial noted that Xi’s weak domestic economy could encourage cooperation and additional promises to purchase U.S. agricultural goods and aircraft. However, the board expressed skepticism about those commitments, writing that “Mr. Xi has made that promise before, and U.S. farmers have never regained their lost market share in China.” The editorial devoted significant attention to artificial intelligence and advanced semiconductor exports, arguing that Beijing views AI as “a decisive theater in Beijing’s competition with the U.S.” while warning that China continues to pursue technology acquisition aggressively. The board cited Trump administration warnings about “industrial scale” theft of American AI models and referenced Justice Department indictments involving alleged schemes to divert high-end chips to China. Taiwan was described as the summit’s most sensitive issue. The editorial argued Xi is attempting to pressure Washington into formally “opposing” Taiwanese independence rather than merely “not supporting” it — a distinction the Journal said would fundamentally alter decades of carefully calibrated U.S. policy. The piece warned that such a shift would validate what it called a false Chinese narrative portraying Taiwan as the aggressor in the Taiwan Strait. The board also warned that allies across Asia are closely monitoring Trump’s handling of the summit, particularly Japan, which it said is watching “with anxiety.” The editorial suggested Trump should have visited Tokyo before Beijing as a symbolic demonstration of solidarity with regional allies concerned about Chinese influence and U.S. strategic resolve. Note: U.S. Treasury Secretary Scott Bessent will visit Japan for three days to meet Prime Minister Sanae Takaichi, Finance Minister Satsuki Katayama and Bank of Japan Gov. Kazuo Ueda. Discussion will likely cover currency issues, energy procurement and the Iran war. Bessent will then head to China with President Trump later in the week. Meanwhile, the opinion piece argued the administration is pursuing a form of détente with Beijing even as China continues supporting countries such as Russia, Iran and North Korea economically and industrially. While acknowledging that temporary stabilization could provide the United States time to diversify rare-earth supply chains and strengthen defense capabilities, the editorial warned against assuming Xi’s broader objectives have changed.  —U.S./China Trade Board proposal signals push for managed commerceTrump administration eyes new framework covering tens of billions in trade ahead of Beijing summit A senior Trump administration official said Sunday that a proposed U.S./China “Board of Trade” could eventually oversee “double-digit billions” of dollars in trade flows, signaling a potentially significant shift toward a more managed commercial relationship between the world’s two largest economies ahead of President Donald Trump’s summit this week with Chinese President Xi Jinping. According to White House Principal Deputy Press Secretary Anna Kelly, the upcoming Beijing meetings will include discussions on a U.S.-China “Board of Trade,” a related “Board of Investment,” and potential agreements involving aerospace, agriculture, and energy sectors. The comments suggest the administration is trying to build a more structured framework for trade in non-sensitive goods while continuing to wall off strategically sensitive industries from deeper integration. U.S. Trade Representative Jamieson Greer has previously described the Board of Trade concept as a mechanism to manage commerce in areas viewed as less critical to national security. Administration officials now appear to be fleshing out what that framework could look like operationally. One senior official said the proposed arrangement could initially govern “double-digit billions” of dollars in trade, though the exact products and sectors remain undefined. The official characterized any expected announcement in Beijing as “forward-leaning,” but emphasized that substantial domestic work would still be required after the summit to formally establish the mechanism. That process could include a Federal Register notice and public comment period to determine which goods should fall under the arrangement, including debates over what the United States should export to or import from China. The comments indicate the administration may be envisioning something more formalized than past sector-specific purchase agreements — potentially a standing institution designed to stabilize portions of the bilateral economic relationship amid broader geopolitical tensions. Agriculture appears positioned to play a central role in any near-term agreements. Administration officials indicated that talks with Beijing have been ongoing for some time regarding potential Chinese purchases in agriculture, aerospace, and energy, though they stopped short of confirming whether formal deals would be signed during Trump’s trip. The emphasis on agriculture is notable given China’s historical role as a major buyer of U.S. soybeans, corn, pork, and other commodities. Markets have closely watched whether Beijing would eventually increase agricultural purchases again as part of efforts to stabilize relations and secure supply chains during a period of elevated global energy and shipping uncertainty tied to the Iran conflict and ongoing Strait of Hormuz disruptions. Meanwhile, uncertainty remains over the future of the one-year U.S./China trade truce announced in Busan, South Korea, last October. That agreement included China’s commitment not to impose new rare earth export restrictions — a critical issue for U.S. manufacturing, defense, and technology sectors. Administration officials said discussions are ongoing regarding whether the rare earth provisions and broader truce will be extended before the October expiration date. Officials stressed that both Washington and Beijing are seeking “stability,” though they acknowledged no final decision has yet been made on an extension. The timing of the discussions reflects broader efforts by both countries to reduce economic volatility while preserving leverage in strategic sectors. The proposed trade board structure may ultimately represent an attempt to separate politically acceptable commercial trade from increasingly contentious battles over technology, semiconductors, artificial intelligence, defense supply chains, and critical minerals. As previously noted, President Donald Trump is scheduled to arrive in Beijing Wednesday evening and meet with Chinese President Xi Jinping on Thursday before departing Friday. —House set for high-stakes E15 vote amid fuel price surgeCongress weighs nationwide year-round E15 sales as ethanol advocates, refiners, and environmental groups clash over fuel costs, farm income, and refinery compliance burdens. House lawmakers are preparing for a pivotal vote this week on legislation that would allow nationwide year-round sales of E15 gasoline, potentially ending years of political and regulatory disputes surrounding higher ethanol fuel blends. Bloomberg notes that the debate comes as gasoline prices have surged amid the Iran conflict and ongoing disruptions tied to the Strait of Hormuz, with supporters arguing E15 offers consumers a lower-cost fuel alternative while also boosting demand for U.S. corn. E15 is a fuel blend made up of 85% gasoline and 15% ethanol. Biofuel advocates say the blend is typically 10 to 40 cents per gallon cheaper than conventional gasoline and could help ease pressure on consumers facing elevated pump prices. Most gasoline currently sold in the U.S. contains 10% ethanol, commonly referred to as E10. Federal Clean Air Act restrictions currently prohibit E15 sales during summer months because of concerns about fuel volatility and ground-level ozone formation, although the Environmental Protection Agency has repeatedly issued temporary waivers in recent years. The latest emergency waiver took effect May 1 and is scheduled to expire May 20. Supporters of year-round E15 sales argue the measure would provide badly needed demand growth for the ethanol industry at a time when U.S. corn supplies remain abundant and ethanol plants are operating below capacity. U.S. ethanol production capacity stands near 18.5 billion gallons annually, but actual production is closer to 17 billion gallons, with roughly 2.5 billion gallons exported overseas.  Industry groups including the Renewable Fuels Association, Growth Energy, and the National Corn Growers Association have long pushed for permanent nationwide E15 access, arguing retailers are reluctant to invest in E15 infrastructure if summer sales remain uncertain. The legislation has also drawn support from the American Petroleum Institute, although a coalition of 28 smaller refiners continues to oppose the proposal. Refiners including Delek US Holdings and Suncor Energy warned earlier this year that expanding E15 without stronger refinery protections could increase compliance costs, threaten refinery operations, and raise fuel prices in some regions. The House proposal attempts to bridge those concerns by reducing annual ethanol blending obligations by 75% for smaller refiners producing less than 75,000 barrels per day and allowing facilities to petition the EPA for hardship exemptions if compliance costs threaten closure. Environmental groups remain skeptical. The Sierra Club argues ethanol should not be treated as a clean fuel solution and says policymakers should instead focus on electric vehicles and public transportation investments. Of note: This week, House lawmakers are expected to vote on a procedural measure that would formally separate the E15 proposal from the broader farm bill, followed by a vote on final passage of the standalone E15 legislation. Even if Republican leaders can bridge divisions within their caucus and secure House approval, the measure’s prospects in the Senate remain uncertain. —Trump administration regulatory agenda faces delays on key food and biofuel policiesUPF definition, 45Z guidance, and 2028 RFS proposal still await final regulatory review Several closely watched regulatory actions from the Trump administration remain pending as food, agriculture, biofuel, and energy stakeholders continue monitoring developments surrounding ultra-processed foods (UPFs), the 45Z Clean Fuel Production Credit, and future Renewable Fuel Standard (RFS) obligations. One of the most anticipated actions involves the administration’s forthcoming definition of ultra-processed foods. Robert F. Kennedy Jr. has said the Food and Drug Administration completed its work on the definition and that the proposal was undergoing interagency review. However, the measure still has not been formally transmitted to the Office of Management and Budget for regulatory review, one of the final procedural steps before public release. The administration had previously indicated it hoped to release the UPF definition for public feedback in April, but that self-imposed target has now passed without action. Unlike other regulatory initiatives, the UPF effort does not face a statutory deadline, though the delay continues to draw attention from food manufacturers, consumer advocates, and agricultural groups concerned about how the definition could affect labeling, nutrition policy, and food processing standards. Meanwhile, the administration also has yet to finalize guidance surrounding the 45Z Clean Fuel Production Credit, a major tax incentive viewed as critical for the biofuels sector, including ethanol, renewable diesel, and sustainable aviation fuel producers. Industry participants continue awaiting clarification on key issues such as feedstock eligibility, carbon intensity scoring methodologies, and treatment of imported materials. The administration is expected to issue the 45Z framework through a final rule later this year. Another major pending item is the Environmental Protection Agency’s proposal establishing Renewable Fuel Standard volumes for 2028. While the proposed rule has not yet been forwarded for final review, the administration is expected to release it soon in order to allow for public comment before issuing a final rule by the statutory deadline of Oct. 31, 2026. The pending regulatory package is being closely watched across the agricultural and energy sectors because the outcomes could significantly shape future biofuel production incentives, refining compliance obligations, commodity demand, and food industry standards. —Colorado River crisis deepens as states struggle to reach long-term water dealStopgap conservation proposal from Lower Basin states may delay — but not prevent — deeper water shortages as record-low snowpack and prolonged drought strain the river systemAccording to a report by the Washington Post, the Colorado River system is once again approaching a critical breaking point as historically low snowpack, worsening drought conditions, and years of overuse threaten water supplies and hydropower generation across the American West.  Arizona, California, and Nevada recently unveiled a temporary conservation proposal designed to stabilize Lake Mead through 2028 by encouraging reduced water use and compensating users who voluntarily forgo portions of their annual allocations. Officials from the three Lower Basin states estimate the plan could conserve roughly 3.2 million acre-feet of water over the next several years, helping maintain water levels at the reservoir that serves roughly 20 million people and powers the Hoover Dam. Meanwhile, the U.S. Bureau of Reclamation has begun releasing billions of gallons of water into Lake Powell to prevent reservoir levels from falling low enough to halt hydropower production — a scenario federal officials warned could occur as early as August without intervention. A late-season snowstorm in the Rocky Mountains also provided temporary relief after what experts described as the lowest Colorado River snowpack on record following an exceptionally hot and dry winter. However, water experts cautioned that these measures amount to short-term stabilization rather than a lasting solution. Sarah Porter of Arizona State University’s Kyl Center for Water Policy told the Washington Post that the Lower Basin proposal “is not a solution” but instead reflects the limited agreement states have been able to reach amid years of deadlocked negotiations over how to divide shrinking river supplies. The broader dispute centers on long-term operating rules for the Colorado River system, which are set to expire this autumn. The Bureau of Reclamation is expected to issue a preferred management plan later this summer that could determine how future water cuts are distributed among the river’s roughly 40 million users across seven Western states. Tensions remain high between the Upper Basin states — Colorado, New Mexico, Utah, and Wyoming — and the Lower Basin states. Upper Basin officials argue they already consume less than their legal share and naturally reduce water usage during dry years, while Lower Basin states fear federal intervention could disproportionately harm junior water rights holders, including major Arizona cities such as Phoenix and Tucson. Experts also emphasized that the crisis is rooted in decades of structural over-allocation. Jack Schmidt of Utah State University told the Washington Post that the river’s governing rules were established during an unusually wet historical period, leading officials to promise more water than the river can reliably provide. Human-caused climate change has compounded the imbalance by producing hotter temperatures, lower runoff, and persistently drier conditions across the region. This year alone, Schmidt estimated the Colorado River basin may generate only about 6 million acre-feet of runoff, compared to annual water use of roughly 13 million acre-feet. He compared the system to a household continuing to spend heavily after losing its primary source of income — a model that becomes unsustainable during consecutive dry years.

—Equities today: U.S. equity futures are little changed as markets digest the lack of meaningful progress toward an official U.S.-Iran ceasefire over the weekend. President Donald Trump said Sunday night that Iran’s response to the latest ceasefire proposal was “totally unacceptable,” helping push oil prices higher. Even so, broader markets appear to believe a ceasefire agreement remains the most likely outcome, limiting downside pressure on equities. On the economic front, China’s CPI rose 1.2% year-over-year in April, topping expectations for a 0.9% increase and highlighting the inflationary impact of elevated energy prices. Today, investor attention will remain centered on geopolitical developments, as the economic calendar is light. For now, analysts note that as long as the U.S. refrains from launching broader military strikes against Iran, investors are likely to continue viewing the situation as gradually moving toward a ceasefire rather than a sustained escalation — a backdrop that should help prevent a more significant risk-off move in equities.

In Asia, Japan -0.5%. Hong Kong +0.1%. China +1.1%. India -1.7%.

In Europe, at midday, London +0.2%. Paris -1%. Frankfurt flat.

—Markets rally, but Sevens Report warns risks remain beneath the surface

Strong earnings, resilient economic data and easing geopolitical fears are supporting equities, but Sevens Report says stagflation, Fed tightening and an AI slowdown remain serious threats to the rally 

The latest Sevens Report said U.S. equities continue to benefit from a powerful combination of resilient economic growth, strong corporate earnings and optimism surrounding a potential U.S./Iran ceasefire, helping propel the S&P 500 to fresh record highs. However, the report cautioned that investors should not assume the current rally is immune to reversal risks, especially as inflation pressures tied to elevated energy prices continue to build beneath the surface. 

In the section titled This Isn’t a Perfect Market, So What Can Go Wrong?,Sevens Report outlined three major risks that could materially threaten the market advance rather than simply trigger a short-term pullback.

The first and most immediate concern is the potential emergence of stagflation — a combination of slowing economic growth and persistently high inflation. The report noted that, so far, the U.S. economy has remained resilient despite higher energy costs, with consumers continuing to spend and labor markets remaining firm. However, Sevens warned the real issue is not the magnitude of inflation spikes, but their duration. If oil and commodity prices remain elevated for several more months because of ongoing instability in the Strait of Hormuz and broader Middle East tensions, inflation could become entrenched again while consumer purchasing power weakens.

The report specifically warned that unlike during the COVID-era inflation surge, households are no longer benefiting from stimulus payments or excess savings buffers, leaving consumers more vulnerable to prolonged increases in food, fuel and commodity costs. Sevens concluded that if elevated prices persist into the second half of 2026, stagflation risks could intensify sharply, creating a negative backdrop for both equities and bonds.

The second major risk identified by Sevens Report is the possibility the Federal Reserve may eventually need to resume raising interest rates. The report compared the current environment to the 1970s, when the Fed was forced to reverse course and tighten policy again after previously easing. While Fed officials currently view inflation pressures as largely energy-driven and temporary, Sevens said the central bank is already becoming incrementally more hawkish as inflation readings remain elevated.

According to the report, the market is beginning to assign a greater probability to a rate hike than a rate cut by year-end, even if both scenarios currently remain low-probability outcomes. Sevens cautioned that renewed Fed tightening would likely pressure economic growth and could ultimately produce the kind of equity correction seen during previous inflation-fighting cycles.

The third major concern centers on the sustainability of the AI-driven investment boom that has powered much of the market’s earnings growth. Sevens Report said first-quarter earnings were “undeniably spectacular,” but emphasized that a large share of that growth is being fueled by extraordinary spending from a relatively small number of technology giants and AI-focused firms, including OpenAI, Anthropic, Alphabet, Amazon and Oracle.

The report noted that AI-related capital expenditures are supporting a wide range of sectors beyond technology, including industrials, real estate and consumer goods, because of the massive infrastructure buildout tied to data centers and computing capacity. However, Sevens warned that this economic stimulus effect is highly concentrated. If AI investment spending slows materially, the report said the same companies currently driving economic expansion could instead “export a recession” across multiple sectors of the economy.

Despite those concerns, Sevens Report stressed that none of the identified risks appear imminent and that the market’s current fundamentals remain constructive. The report pointed to continued labor-market resilience, strong services-sector activity and still-solid consumer spending trends as key supports for the broader economy. At the same time, Sevens emphasized that investors should avoid complacency after nearly two decades in which sustained bear markets have been relatively rare.

The report also highlighted this week’s inflation data as a critical near-term test for markets. Sevens said Tuesday’s Consumer Price Index report and Wednesday’s Producer Price Index report will be closely watched for signs that elevated energy prices are beginning to spill into broader core inflation metrics. Core CPI moving back toward or above 3% year-over-year would likely reinforce hawkish Fed expectations and increase concerns about stagflation later this year.

Meanwhile, Sevens maintained that the broader market tone remains constructive for now, supported by solid earnings, resilient employment conditions and optimism that geopolitical tensions in the Middle East will eventually ease.

—USDA daily exports sales: 
•380,000 MT corn to Mexico (220,000 MT for 2025/26, 160,000 mt for 2026/27

• 128,000 MT corn to South Korea for 2025/26

—International grain prices firm ahead of USDA reports

Global wheat, corn and oilseed markets supported by weather risks and energy rally

International grain markets traded mostly firmer on May 11, as weather threats in Brazil and the U.S. Plains combined with elevated crude oil prices and geopolitical uncertainty surrounding the Iran conflict continued to support global agricultural commodities ahead of this week’s USDA WASDE report. European wheat and corn futures strengthened overnight, while Black Sea export prices remained elevated amid ongoing shipping and geopolitical concerns.

Paris Euronext milling wheat futures for May 2026 traded near €222 per metric ton, equivalent to roughly $247 per metric ton or about $6.72 per bushel in U.S. terms using current exchange rates and standard wheat conversion factors. Deferred September wheat futures traded closer to €208 per metric ton, or approximately $231 per metric ton. Russian 12.5% protein FOB milling wheat prices were quoted near $222 per metric ton, compared to U.S. Soft Red Winter Gulf wheat values near $247 per metric ton.

European corn prices also remained firm. Euronext June 2026 corn futures traded near €215 per metric ton, equivalent to approximately $239 per metric ton or about $6.07 per bushel in U.S. equivalent pricing. Chicago Board of Trade July corn futures traded near 459 cents per bushel, equal to roughly $181 per metric ton. Physical Black Sea corn export values remained near $203 per metric ton FOB.

On China’s Dalian exchange, July corn futures traded near 2,379 yuan per metric ton, equivalent to roughly $328 per metric ton or approximately $8.33 per bushel using prevailing exchange rates. Dalian soymeal futures also remained supported amid concern about dryness in portions of Brazil’s safrinha corn belt and tightening vegetable oil markets.

Meanwhile, Malaysian palm oil futures traded near 4,516 ringgit per metric ton, equivalent to roughly $1,040 per metric ton, supported by crude oil prices above $100 per barrel and stronger global biofuel demand expectations. Higher palm oil prices continued to underpin soybean oil futures globally.

Traders are now focused on Tuesday’s USDA World Agricultural Supply and Demand Estimates report, which is expected to provide updated forecasts for global wheat, corn and soybean supplies at a time when weather volatility and geopolitical disruptions are increasing uncertainty across world grain markets.

—Overnight U.S. grain markets: Grain futures finish firmer as soybeans and wheat lead overnight gains

Bias: Bullish — soybeans and wheat higher; corn firms

At the 8:45 a.m. ET close of overnight electronic trading: 

July corn $4.745 +3 1/4

July beans $12.185 +10 1/2

July meal $323.60 +$3.90

July soyoil 74.90 +0.58

July SRW $6.275 +8 1/2

July HRW $6.83 + 7 1/4

Overnight trade was broadly firmer, led by strength in soybeans and wheat, with soybean meal also supporting the soy complex. Corn followed higher in quieter trade.

Trader attention remains on U.S. weather and positioning ahead of the next round of USDA crop progress data and upcoming Crop Reports and WASDE expectations.

In outside markets, crude oil futures traded higher while the U.S. dollar index was firmer.

—Funds build record bullish bets across grain markets

Massive corn and soybean long positions signal growing confidence in U.S. agriculture demand outlook

Managed money funds last week established a record net long position across U.S. grains and oilseeds, driven primarily by aggressively bullish bets in corn and soybeans as investors increasingly positioned for tighter global supplies, resilient export demand, and elevated geopolitical risk tied to the Iran war and broader commodity inflation concerns.

The surge in speculative buying reflects a dramatic shift in sentiment across agricultural markets over recent weeks. Traders have become increasingly concerned that weather risks in key Northern Hemisphere growing regions, rising energy costs, and disruptions to global fertilizer and shipping markets could tighten world grain supplies later this year. At the same time, strong demand expectations for feed grains, biofuels, and vegetable oils have encouraged funds to continue adding long exposure.

Corn futures have attracted the largest share of speculative buying. Funds have built one of the most bullish corn positions on record as traders focus on potential weather threats across portions of the U.S. Corn Belt, uncertainty surrounding global feed grain availability, and expectations for continued strong export demand. Elevated crude oil prices have also supported ethanol economics, adding another layer of bullishness to the corn market.

Soybeans have likewise seen a sharp increase in fund buying. Investors have increasingly viewed soybeans and soybean oil as key beneficiaries of tightening global vegetable oil supplies and expanding biofuel demand. Concerns about South American logistics, rising shipping costs, and the possibility of further supply disruptions linked to instability in the Middle East have also helped support bullish positioning.

Meanwhile, speculative interest has expanded beyond outright supply concerns. Some investors increasingly view agricultural commodities as an inflation hedge amid persistently high energy prices and renewed concerns about global supply chain disruptions. The Iran war has amplified those concerns by increasing transportation costs and raising fears about fertilizer availability and affordability during key growing periods.

The record net long position also highlights how rapidly investor sentiment has changed compared to earlier this year, when many funds were positioned defensively amid expectations for large global harvests and softer commodity prices. Since then, weather uncertainty, stronger Chinese buying activity, rising crude oil prices, and renewed geopolitical tensions have fueled a broad commodity rally that has drawn additional speculative capital into agricultural markets.

Still, the large bullish positioning also increases the risk of heightened volatility ahead. Grain markets remain highly sensitive to changes in weather forecasts, export demand, Black Sea trade flows, and macroeconomic developments. Any improvement in crop conditions or easing in geopolitical tensions could trigger periods of aggressive profit-taking by funds holding historically large long positions.

Analysts will closely monitor upcoming U.S. weather patterns, export sales data, and monthly USDA supply-and-demand reports for confirmation that tightening fundamentals can justify the exceptionally large speculative exposure now built into grain and oilseed futures markets.

—Sulfur spike raises new alarm for global fertilizer markets

Middle East supply disruptions and tightening sulfur availability threaten phosphate fertilizer production, adding another layer of risk for corn and soybean growers

Sulfur futures surged to a record CNY 7,050 per tonne as the Iran war and the near closure of the Strait of Hormuz disrupted one of the world’s most important fertilizer supply chains. The Middle East accounts for nearly half of global sulfur production, and reduced shipments through the Gulf have sharply tightened global availability, fueling a rapid rally in prices and intensifying concerns across agricultural and industrial markets.

The spike matters because sulfur is a key feedstock for sulfuric acid, which is essential in the production of phosphate fertilizers widely used on corn and soybean acres. Higher sulfur costs are expected to filter directly into fertilizer pricing, potentially raising input costs for farmers already facing elevated energy and freight expenses tied to the broader Middle East conflict.

The market was already under pressure before the latest geopolitical escalation. Strong industrial demand — particularly from the global mining sector, where sulfuric acid is heavily used in metal extraction and ore processing — had tightened supplies throughout the year.

Meanwhile, export restrictions and constrained shipments from major suppliers including China and Russia further reduced available material on the global market.

Fertilizer manufacturers are increasingly competing against industrial users for shrinking sulfur supplies. Some producers have reportedly already curtailed output as inventories tighten and replacement cargoes become harder to secure. The situation is raising concerns about broader disruptions extending beyond agriculture into mining, chemicals, and industrial manufacturing.

The sulfur rally also underscores how deeply global fertilizer markets remain tied to energy and shipping flows through the Persian Gulf. Any prolonged disruption to tanker traffic through the Strait of Hormuz could further tighten sulfur, phosphate, and ammonia markets, amplifying volatility in global crop input costs heading into the Northern Hemisphere growing season.

—Fertilizer, fuel spike adds fresh pressure to farm margins

Southern Ag Today analysis highlights rising input costs tied to Middle East conflict and energy volatility

Writing in Southern Ag Today (link), LSU AgCenter economist Michael Deliberto warned that rising fertilizer and diesel prices linked to the ongoing Middle East conflict are sharply increasing production costs for U.S. farmers at a time when operating margins are already “razor thin.”

Deliberto noted that prolonged increases in crude oil and natural gas prices are feeding directly into fertilizer markets, exposing U.S. agriculture to global supply disruptions despite significant domestic fertilizer production. According to the analysis, the U.S. still relies heavily on imports for key nutrients — particularly potash, where imports account for 94% of consumption and originate largely from Canada, Russia, Belarus, and Israel.

The report compared Louisiana crop production costs between early January and mid-March 2026 and found substantial increases in both fertilizer and diesel fuel expenses. Nitrogen fertilizer prices rose 27%, potash increased 10%, while diesel prices climbed from $2.85 to $4.04 per gallon — a 42% jump.

Corn producers were among the hardest hit. Energy-related input costs for Louisiana corn production increased nearly $55 per acre, including a $34 increase in fertilizer costs and a $21 rise in diesel expenses. Rice producers saw the steepest increase overall, with combined fertilizer and fuel costs rising nearly $78 per acre because of the heavy diesel requirements associated with flood irrigation. Cotton costs increased by roughly $41 per acre, while soybeans experienced a more moderate $14-per-acre increase because soybeans require no nitrogen fertilizer applications.

The analysis emphasized that many farmers have struggled to pre-book fertilizer and fuel supplies earlier in the season due to tight cash flow conditions across the farm economy. Deliberto argued this has left producers more exposed to sudden geopolitical disruptions and volatile input markets.

The report also translated those higher costs into additional yield requirements needed just to break even. At current commodity price assumptions, producers would need an extra 11 bushels of corn per acre, 111 pounds of cotton lint, 6.4 hundredweights of rice, or seven additional soybean bushels per acre to offset the higher expenses. Deliberto noted that achieving those gains could prove difficult, particularly after Louisiana already experienced favorable production conditions in 2025.

—Echoes of the beef trust era resurface in today’s meatpacking debate

A passage from Theodore Roosevelt’s antitrust battles is drawing striking comparisons to modern concerns over consolidation, pricing power, and federal scrutiny of the meat industry

A reader recently highlighted a passage from historian Doris Kearns Goodwin’s 2012 book The Bully Pulpit that feels remarkably current amid ongoing scrutiny of the U.S. meatpacking industry.

The excerpt recounts how President Theodore Roosevelt confronted the “beef trust” in the early 1900s after allegations that dominant packers, including Armour & Company and Swift & Company, coordinated territories and fixed prices, driving up meat costs for consumers. At the time, the rise of refrigerated rail cars accelerated consolidation by eroding the competitive advantage of local butchers and regional processors.

Goodwin quotes one New York newspaper describing the beef trust as “an atrocious conspiracy of greed against need,” warning that concentrated control over the nation’s food supply was “hostile to the public welfare.” Following a Justice Department investigation, Roosevelt directed Attorney General Philander Knox to pursue legal action against the packers.

The parallels to today’s debate are difficult to ignore, some say. More than a century later, lawmakers, ranchers, and farm groups continue to raise concerns that a handful of dominant firms wield outsized control over cattle procurement, beef processing capacity, and wholesale pricing. Critics argue that high concentration leaves producers with fewer marketing options while consumers face persistently elevated meat prices.

Meanwhile, advances in technology, logistics, and scale — much like refrigerated freight transformed the industry in Roosevelt’s era — have again reinforced consolidation advantages for the largest firms. Today’s equivalents include automated processing systems, vertically integrated supply chains, export infrastructure, and sophisticated data systems that smaller competitors often struggle to match.

The reader’s broader observation may resonate with many in agriculture: despite decades of investigations, lawsuits, hearings, and reform proposals, the structure of the meatpacking sector has remained heavily consolidated. That reality has fueled skepticism about whether current federal investigations or political pressure campaigns will fundamentally reshape the industry.

Meanwhile, the historical comparison underscores that concerns about market power in agriculture are far from new. The fight between efficiency, scale, and competition has defined the livestock industry for generations. Roosevelt’s trust-busting era demonstrated that public frustration over concentrated economic power can become politically potent when food prices rise and supply chains appear vulnerable.

Today, those same themes are again front and center as policymakers debate antitrust enforcement, livestock pricing transparency, processing capacity expansion, and the broader resilience of the U.S. food system.

Others, however, caution that the current allegations against major meatpackers are not especially new and that previous federal investigations often struggled to produce definitive proof of coordinated wrongdoing. Critics of the latest probes argue that filing accusations against large packers is relatively easy politically, particularly during periods of high food prices and producer frustration, but successfully proving antitrust violations in court has historically been far more difficult. They point to decades of investigations, consent decrees, and lawsuits that generated headlines yet resulted in limited structural change to the industry. Supporters of that view contend that consolidation itself is not necessarily illegal and reflects the economic realities of a capital-intensive business that rewards scale, efficiency, logistics networks, and processing capacity.

Extra note: Another reader says, “You can even go back further. There was concern over the meat packing industry consolidation and control in the 1800’s.  This was a great book on the beginnings of the U.S. cattle industry:”
 

—Oil prices surge again as Iran talks stall and Hormuz risks persist

Trump rejects Iran response, renewing fears of prolonged supply disruptions

Oil prices rallied sharply Monday after President Donald Trump said Iran’s response to a U.S. peace proposal was “unacceptable,” reviving concerns that the conflict in the Middle East could continue disrupting global crude supplies through the Strait of Hormuz Brent crude rose as high as $105.99 per barrel before easing to around $104, while U.S. West Texas Intermediate briefly topped $100 per barrel before trading near $98.

The rebound came just one week after both benchmarks posted roughly 6% weekly declines amid hopes that negotiations could lead to a ceasefire and reopening of the Strait of Hormuz, a critical chokepoint that normally handles roughly one-fifth of global oil flows. Those expectations weakened after Trump publicly rejected Tehran’s latest proposal.

Analysts said the latest developments reinforced the view that supply disruptions could persist for months even if diplomacy resumes. Analysts say markets likely will not see meaningful progress before Trump’s summit this week in Beijing with Chinese President Xi Jinping. Iran and energy security are expected to be major agenda items during the talks.

Meanwhile, Saudi Aramco CEO Amin Nasser warned that the world has effectively lost about 1 billion barrels of oil supply over the past two months and that energy markets will require significant time to stabilize even if Hormuz fully reopens. His comments reinforced a growing industry view that the supply shock has become structural rather than temporary.

Shipping patterns also underscored the continuing risks. Reuters reported that several crude tankers recently exited the Strait of Hormuz with tracking systems switched off to reduce exposure to potential Iranian attacks. One vessel carrying Iraqi crude reportedly sailed toward Vietnam under those conditions. Japan also confirmed that a tanker carrying Azerbaijani crude was expected to arrive this week, marking one of the first Central Asian cargoes received since the conflict began.

The disruptions are increasingly reshaping global trade flows. Saudi crude exports to China are expected to decline further in June as high prices and constrained supply reduce buyer demand. At the same time, refiners and governments continue scrambling for alternative sources of crude outside the Gulf region.

Longer term, some analysts believe the conflict could permanently alter oil market pricing dynamics. ANZ analysts projected Brent crude could remain above $90 per barrel through 2026, with prices potentially settling in the $80 to $85 range into 2027 as inventories slowly recover and demand growth resumes.

The widening spread between Brent and WTI also reflects growing uncertainty over U.S. export policy. Reuters noted that U.S. shale producer Diamondback Energy recently purchased options tied to a much wider WTI discount to Brent, effectively betting that Washington could eventually restrict crude exports if domestic fuel shortages worsen. Such a move could trap excess crude inside the United States, sharply pressure domestic benchmark prices, and further distort global energy markets.

—California’s fuel crunch deepens as Middle East oil shipments halt

Wall Street Journal reports California faces extended energy pain from Hormuz disruption

The Wall Street Journal reported that California’s fuel crisis is poised to worsen after the arrival of what could be the state’s final Middle Eastern crude shipment for months, underscoring how heavily the Golden State depends on foreign oil supplies amid the ongoing Strait of Hormuz disruption.

The supertanker New Corolla recently delivered roughly 2 million barrels of Iraqi crude to Long Beach after departing Basra before the U.S. and Israeli strikes on Iran. Market intelligence firms Vortexa and Kpler indicated that no additional Middle Eastern crude tankers are expected to arrive in California until well after the Strait of Hormuz reopens and regional shipping flows normalize.

California is particularly exposed because it imports roughly 75% of the oil it consumes, with nearly one-third coming from the Middle East. The report noted that decades of refinery closures and declining in-state oil production have left California more dependent on imports from Saudi Arabia, Iraq, and the United Arab Emirates than any other U.S. state. Analysts told the Journal that even after the strait eventually reopens, supply chains could take one to two months to normalize.

Meanwhile, fuel prices continue climbing. Gasoline prices in California averaged $6.16 per gallon Friday, about $1.61 above the national average, while diesel prices reached $7.48 per gallon. The strain has been compounded by reduced fuel exports from Asian suppliers such as South Korea, which has curtailed shipments to preserve domestic supplies. Imports of refined products from South Korea reportedly fell to roughly 35,000 barrels per day in May from 100,000 barrels per day in April.

The situation has also been exacerbated by refinery shutdowns. Two major California refineries have closed over the past six months, removing nearly one-fifth of the state’s refining capacity. Analysts cited in the article estimated that the Strait of Hormuz closure has already withheld at least 1 billion barrels from the global market.

The Trump administration has attempted to ease supply shortages through emergency measures. A temporary waiver of the Jones Act has allowed larger foreign tankers to transport fuel from the Gulf Coast to California, improving economics for shipments through the Panama Canal. Since March, refiners including Marathon Petroleum have moved roughly 2 million barrels of gasoline, jet fuel, and biodiesel to the West Coast aboard foreign vessels.

The administration also invoked the Defense Production Act to support the restart of a pipeline operated by Sable Offshore, allowing about 50,000 barrels per day of California crude production to resume. Chevron CEO Mike Wirth said the company was doing “everything we can” to meet fuel obligations in California while arguing that the state’s energy vulnerabilities were the result of “decades of poor energy policy.”

California Gov. Gavin Newsom has instead blamed President Donald Trump and the Iran conflict for soaring prices, arguing that the administration’s military actions contributed directly to the Strait of Hormuz closure and resulting supply shock.

The Journal concluded that California’s limited pipeline connectivity to major U.S. oil-producing regions such as Texas and New Mexico leaves the state uniquely vulnerable during global supply disruptions. Analysts warned that as long as the Strait of Hormuz remains constrained, California will continue struggling to replenish rapidly declining crude and refined fuel inventories.

—Ethanol fight splits GOP as E15 vote nears

Wall Street journal editorial says ethanol lobby “held the farm bill hostage” — supporters argue year-round E15 expands fuel choice and supports rural America

The editorial board of the Wall Street Journal sharply criticized the ethanol industry’s push for a standalone House vote on year-round E15 sales, arguing the corn ethanol lobby leveraged its political influence during farm bill negotiations to secure additional policy concessions beyond traditional farm support.

The opinion piece (link) contends that ethanol interests — backed heavily by corn-state lawmakers — threatened to derail the newly passed five-year farm bill unless congressional leaders agreed to advance legislation allowing nationwide year-round sales of E15 gasoline and restricting small-refinery waivers under the Renewable Fuel Standard (RFS). The editorial characterizes the effort as an “extortion play,” arguing the industry exploited farm-state political pressure created by tariff-related export losses under President Donald Trump’s trade policies.

The Wall Street Journal’s argument. The editorial argues the existing Renewable Fuel Standard already imposes substantial costs on refiners and consumers by forcing increasing volumes of ethanol and other biofuels into the nation’s fuel supply. The board cites EPA estimates that recently increased biofuel blending quotas could impose roughly $20 billion annually in compliance costs, which ultimately filter down to consumers through higher fuel prices.

The editorial also argues that higher ethanol blends can create infrastructure and environmental concerns. One longstanding issue involves summer gasoline volatility rules. Federal restrictions historically limited E15 sales during warmer months because of concerns over smog formation, though ethanol supporters dispute the severity of those concerns and have pushed for parity with E10 gasoline.

The editorial further argues that many fuel retailers and distribution systems have not upgraded tanks, pumps, and infrastructure necessary for broader E15 adoption. It also highlights the so-called “blend wall” problem — the practical limit on how much ethanol can realistically be absorbed into the fuel supply as gasoline demand growth slows and fuel efficiency improves.

Another major complaint centers on Renewable Identification Numbers, or RIN credits. Smaller refiners have long argued they face disproportionate compliance burdens under the RFS because they often lack blending operations and must purchase credits from larger refiners or biofuel producers. The editorial says restricting small-refinery exemptions would disproportionately hurt independent and smaller refining companies, including some located in the Midwest and Rust Belt.

The board ultimately argues that expanding E15 while simultaneously tightening refinery exemptions amounts to redistributing economic pain rather than solving broader farm-sector problems tied to tariffs and weak export markets.

Ethanol industry and supporters’ counterpoint. Supporters of year-round E15 sales argue the policy simply creates regulatory consistency and consumer choice rather than a new mandate.

Ethanol advocates note that E15 has already been approved by EPA for use in most vehicles built since 2001, representing the overwhelming majority of cars on U.S. roads. They argue the fuel blend is often priced below standard gasoline, potentially offering savings to consumers during periods of elevated crude oil and gasoline prices.

Corn-state lawmakers and biofuel groups also argue ethanol strengthens U.S. energy security by reducing reliance on imported petroleum and diversifying the fuel supply. Supporters frequently point to the Iran war and instability in the Strait of Hormuz as evidence that domestic fuel alternatives remain strategically important.

Backers of E15 additionally argue that summer restrictions are largely the result of an outdated regulatory quirk rather than modern scientific evidence. Ethanol groups contend E15 can produce emissions profiles comparable to — or in some cases better than — conventional E10 gasoline blends under current vehicle technologies.

On refinery waivers, ethanol supporters argue the small-refinery exemption program expanded far beyond what Congress originally intended. Biofuel groups have long complained that broad exemptions under prior administrations undermined statutory blending targets and weakened demand certainty for ethanol producers and corn growers.

Large integrated refiners have also, at times, supported broader E15 access because they possess blending infrastructure and can generate excess RIN credits, creating a divide inside the refining industry itself.

Farm-state political reality. The fight also reflects the continuing political power of the ethanol industry inside the Republican coalition. Lawmakers from major corn-producing states — particularly Randy Feenstra (R-Iowa) and other Midwestern Republicans — have argued that year-round E15 remains a top priority for rural economies heavily dependent on corn demand and ethanol production.

Meanwhile, opponents counter that ethanol policy increasingly functions as a government-supported demand program benefiting a politically influential agricultural sector rather than a necessary energy-security measure.

The debate has become even more politically sensitive because it comes during a period of elevated farm stress tied to tariffs, volatile fertilizer costs, weaker export demand, and uncertainty surrounding global energy markets.

As the House prepares for a standalone E15 vote this week, the broader fight underscores a long-running tension between agricultural interests, refiners, environmental policy, and consumer fuel costs — one that continues to divide Republicans even as they attempt to hold together a broader farm and energy coalition.

—Trade court ruling deepens legal uncertainty around Trump tariff strategy

Administration appeals decision blocking Use of Section 122 tariffs as broader trade agenda faces mounting judicial scrutiny

The Trump administration on Friday appealed a U.S. Court of International Trade ruling that found the White House improperly used Section 122 of the Trade Act of 1974 to impose a blanket 10% global tariff earlier this year. The decision marks another legal setback for President Donald Trump’s aggressive trade agenda and injects new uncertainty into the administration’s evolving tariff framework just days before Trump is scheduled to meet Chinese President Xi Jinping in Beijing.

In a 2-1 ruling issued Thursday, the trade court concluded that Section 122 was never intended to address persistent trade deficits stemming from the U.S. importing more goods than it exports. The court blocked enforcement of the tariffs only for the three plaintiffs that brought the lawsuit — two small import businesses and the state of Washington — but the broader legal implications could extend far beyond those parties.

The ruling adds to mounting judicial resistance to Trump’s tariff authorities. Earlier this year, the U.S. Supreme Court struck down the administration’s previous global tariffs imposed under the International Emergency Economic Powers Act (IEEPA), ruling that the president lacked authority to levy sweeping import duties under national emergency powers. Following that decision, the administration pivoted to Section 122 authority to maintain a 10% across-the-board tariff regime while pursuing more durable trade actions.

Section 122 tariffs were always designed as a temporary measure, however. Under the statute, the duties are scheduled to expire on July 24 unless Congress authorizes an extension. The court’s decision now raises additional doubts about whether the administration can preserve even that interim framework.

President Trump sharply criticized the ruling, blaming what he called “two radical left judges” for the decision. Meanwhile, U.S. Trade Representative Jamieson Greer said the administration expects to prevail on appeal and maintained confidence in the broader trade strategy despite recent courtroom losses.

The latest case also sets the stage for another potentially massive battle over tariff refunds. Billions of dollars in import duties could ultimately be challenged if courts continue rejecting the administration’s legal rationale for broad-based tariffs. U.S. Customs and Border Protection has already begun preparing refund mechanisms tied to the earlier IEEPA tariff rulings, and additional refund exposure could emerge if the Section 122 tariffs are ultimately invalidated nationwide.

Meanwhile, the administration appears increasingly focused on Section 301 of the Trade Act of 1974 as its most durable trade weapon. Unlike the IEEPA and Section 122 approaches, Section 301 has survived repeated legal scrutiny over the years because it is specifically designed to address unfair foreign trade practices. The administration currently has three active Section 301 investigations underway, all expected to conclude in July, which could form the legal basis for a new round of more targeted tariffs on major trading partners, including China.

—China’s EV export boom accelerates amid rising oil prices

Electric and plug-in hybrid exports top gasoline vehicles for first time

China exported more electric vehicles and plug-in hybrids than gasoline-powered vehicles for the first time in April, underscoring the country’s growing dominance in the global auto market just as rising oil prices from the Iran conflict reshape transportation economics worldwide.

Facts and figures. According to the China Passenger Car Association, so-called “new-energy vehicles” — including battery electric vehicles and plug-in hybrids — accounted for just over half of the 769,000 vehicles China shipped overseas in April. Exports of those vehicles more than doubled from a year earlier, reflecting strong international demand despite growing trade tensions and tariff barriers in the U.S. and Europe.

The milestone highlights how China has steadily built a commanding lead across the electric vehicle supply chain, from battery minerals and processing to manufacturing scale and lower-cost production. Chinese automakers, led by companies such as BYD, SAIC Motor, and Geely, have aggressively expanded exports into Southeast Asia, Latin America, the Middle East, and Europe, often undercutting Western competitors on price.

Meanwhile, the timing is particularly notable as the war involving Iran and the continued disruption risks in the Strait of Hormuz have driven renewed volatility in global oil markets. Higher gasoline and diesel prices tend to improve the economic appeal of EVs and hybrids, especially in large fuel-importing nations vulnerable to energy shocks.

Analysts increasingly view the combination of elevated oil prices and China’s low-cost EV manufacturing capacity as a potentially powerful competitive advantage. While U.S. and European policymakers continue debating tariffs and industrial protections aimed at Chinese autos, many emerging-market consumers are prioritizing affordability and fuel savings over geopolitical considerations.

China’s export surge also reflects a broader structural shift in the global auto industry. For decades, international trade in vehicles was dominated by gasoline-powered cars produced by Japan, Europe, and the United States. Now, China is rapidly becoming the central export hub for electrified transportation, aided by substantial domestic subsidies, aggressive industrial policy, and massive investments in battery technology.

Meanwhile, plug-in hybrids appear to be gaining particular traction internationally because they offer consumers protection against high fuel costs without requiring fully developed charging infrastructure. That dynamic could further accelerate Chinese export growth in regions where EV charging networks remain limited.

The latest export figures are also likely to intensify pressure on Western automakers already struggling with slower EV demand growth, high production costs, and increasingly competitive Chinese pricing. As global oil market uncertainty persists, China’s growing scale in electric transportation may further widen the gap between Chinese manufacturers and many traditional automakers.

—China inflation picks up as energy shock offsets weak food prices

Middle East conflict and higher fuel costs push Chinese CPI above expectations in April

China’s annual inflation rate accelerated to 1.2% in April 2026 from 1.0% in March, coming in above market expectations of 0.8% as higher energy costs and supply chain disruptions tied to the prolonged Middle East conflict filtered through the economy. The stronger inflation reading underscores how rising global commodity and transportation costs are beginning to outweigh persistent domestic demand weakness in some sectors, particularly as oil prices remain elevated amid disruptions linked to the Strait of Hormuz.

The sharpest acceleration came from non-food inflation, which climbed to 1.8% year-over-year from 1.2% in March. Transport prices surged 4.6% compared to just 0.9% previously, reflecting the impact of higher crude oil and fuel costs as well as increased freight expenses. The data suggest China is increasingly importing inflation through energy and logistics channels even as domestic consumption remains uneven.

Other consumer categories also posted steady gains. Healthcare prices rose 2.2% year-over-year, while education costs increased 1.3%. Clothing prices remained elevated at 1.5%, signaling that broader service-sector and consumer goods inflation remains relatively firm despite ongoing weakness in the property market. Housing costs, however, continued to decline by 0.2%, highlighting lingering softness in China’s real estate sector and subdued household confidence tied to housing values.

Food prices provided the main offset to broader inflation pressures. Food inflation fell 1.6% year-over-year after rising 0.3% in March, marking the first decline since January. Weak pork prices continued to weigh heavily on the category, while lower costs for fresh vegetables and fruits also contributed to the drop. The decline illustrates that underlying consumer demand in China remains fragile even as external cost pressures intensify.

Meanwhile, core inflation — which excludes volatile food and energy prices — edged up to 1.2% from 1.1%, indicating a modest firming in underlying consumer prices. On a monthly basis, China’s CPI rose 0.3% after falling 0.7% in March, sharply outperforming expectations for a 0.1% decline and reinforcing signs that imported inflation pressures are beginning to build.

The stronger-than-expected inflation data could complicate Beijing’s policy outlook. While China’s economy still faces structural weakness tied to property markets and consumer confidence, rising energy and transport costs linked to geopolitical instability may limit the room for aggressive monetary easing in the months ahead.

—Southern redistricting battle escalates after Supreme Court ruling

GOP-led southern states move to redraw congressional maps as Democrats warn of intensifying gerrymander fight

According to The Hill, Republican-led Southern states are accelerating efforts to redraw congressional maps after a recent Supreme Court ruling on Louisiana’s congressional districts reignited the national redistricting battle ahead of the 2026 midterm elections. The ruling, which struck down Louisiana’s second majority-Black district as an unconstitutional racial gerrymander, has opened the door for additional GOP-led map changes across the South as Republicans seek to protect their narrow House majority.

The legal and political fight is rapidly spreading through states including Louisiana, Alabama, Tennessee, and South Carolina, where Republican lawmakers are pursuing new congressional maps that could weaken Democratic representation and reduce the number of majority-Black districts. Democrats and voting rights advocates argue the moves represent an aggressive push to consolidate Republican power before the midterms.

In Louisiana, lawmakers have already delayed House primaries while the Legislature prepares to approve a new congressional map following the Supreme Court decision. The state’s previous map created a second majority-Black district represented by Rep. Cleo Fields (D-La.), but the Court ruled the district constituted an illegal racial gerrymander. Election law experts warned that changing maps and election dates so close to the November election cycle could create significant confusion for voters and candidates alike.

In Alabama, Republicans approved legislation that could trigger new congressional elections if federal courts allow the state to abandon its current court-ordered map. GOP lawmakers want to revive a previously rejected map that could threaten freshman Rep. Shomari Figures (D-Ala.), whose district was created after courts required Alabama to establish a second district where Black voters hold substantial influence. Democrats and civil rights advocates staged protests at the state capitol, accusing Republicans of attempting to weaken Black political representation.

Meanwhile, Tennessee Republicans approved a new congressional map that dismantles the Memphis-based majority-Black district currently represented by Rep. Steve Cohen (D-Tenn.). The new plan divides Memphis into multiple districts and further fragments Nashville, moves critics describe as classic partisan gerrymandering. Cohen sharply criticized the map and vowed to challenge it in court, while the Tennessee Democratic Party filed suit seeking to block the new lines before the 2026 elections.

In South Carolina, Republicans are also moving toward potential redistricting after lawmakers voted to extend the legislative session to allow additional map-drawing. The likely target would be the state’s lone Democratic congressional district represented by Rep. James Clyburn (D-S.C.). Clyburn accused Republicans of trying to eliminate Democratic representation in the state at the request of President Donald Trump. Clyburn on Republican-led states’ efforts to redraw their maps including in South Carolina, on CNN’s State of the Union: “The Supreme Court, two years ago, spoke to this district and said it was not unconstitutional. But the president says he wants them to redraw the lines anyway. All I’m going to say to that is — be very careful what you pray for, because what I do believe is that when they finish with the redistricting, there will be the possibility of at least three Democrats getting elected here in South Carolina to the United States Congress.”

The Republican push comes as Democrats simultaneously suffered a setback in Virginia, where the Virginia Supreme Court invalidated a voter-approved redistricting plan that Democrats hoped would create as many as four new pickup opportunities in future House elections. Political analysts say the combined developments have intensified what some describe as a full-scale national redistricting arms race ahead of the midterms.

— NWS outlook: There is a Marginal Risk (level 1/5) of severe thunderstorms over parts of the Southeast on Monday… … There is a Marginal Risk (level 1/4) of excessive rainfall over parts of the Central Gulf Coast on Monday.

—U.S. weather pattern splits Corn Belt, Plains as heat accelerates planting before wetter shift

Hot, dry conditions across the western Midwest and Plains are expected to speed fieldwork this week, but a wetter pattern developing late in the period could slow planting in parts of the eastern Corn Belt while boosting winter wheat prospects in the central Plains 

Weather conditions across the U.S. are expected to remain sharply divided through the next five days, with intense heat and dryness dominating the western half of the country while cooler conditions persist in the East. High temperatures are forecast to surge into the upper 90s and near 100 degrees across portions of the western Corn Belt and central Plains by Thursday and Friday, accelerating planting activity in key states such as Iowa and Minnesota.

The hot, dry stretch is expected to support rapid fieldwork progress across much of the Corn Belt and Plains through at least Thursday, as precipitation remains limited. Farmers are likely to take advantage of the open weather window to advance corn and soybean planting after recent delays in some northern areas.

Meanwhile, the heat is expected to increase short-term stress on developing hard red winter wheat across Kansas and Oklahoma, particularly in areas already facing limited soil moisture. The combination of above-normal temperatures and persistent dryness could pressure crop conditions ahead of a more active weather pattern later in the forecast.

Conditions are expected to shift significantly during the 6–10-day period as a stronger storm system develops across the central U.S. Forecast models indicate widespread above-normal rainfall totals exceeding 2 inches across portions of the eastern Plains, Missouri, central Illinois, and Indiana. The rainfall is expected to provide much-needed moisture relief for winter wheat areas in the central Plains, improving yield prospects after recent heat concerns.

However, the wetter pattern is also expected to abruptly slow planting operations in parts of the southeastern Corn Belt, where fields have struggled to fully dry following earlier rounds of rain. Producers in Indiana and surrounding areas could face renewed delays as saturated conditions return.

The Mid-South is expected to benefit from below-normal rainfall during the first week of the forecast, providing an important opportunity for producers to complete spring fieldwork before wetter conditions redevelop early in Week Two. The return of above-normal precipitation later in the period could again tighten planting windows across portions of the Delta and lower Mississippi Valley.

—Brazil safrinha corn forecast splits sharply between drought stress and frost risk

Northern growing regions face escalating heat and dryness while southern areas contend with near-term frost concerns followed by improving moisture conditions.

Brazil’s safrinha corn belt is expected to remain sharply divided over the next 15 days, with northern production areas facing intensifying drought stress while southern regions contend with a short-term frost threat before receiving beneficial rainfall. Forecast models continue to show overwhelmingly dry conditions across the northern safrinha belt, with most areas projected to receive less than one-half inch of precipitation through the forecast period and some locations in northern Goiás and eastern Mato Grosso expected to receive virtually no rainfall at all.

The lack of moisture is expected to become increasingly problematic as hotter weather returns beginning Thursday. Temperatures across key northern growing areas are forecast to run 4 to 7 degrees above normal, increasing evapotranspiration rates and placing additional stress on developing safrinha corn during a critical growth phase. The combination of persistent dryness and above-normal heat is raising concerns about deteriorating yield potential, particularly in areas that have already seen soil moisture reserves decline in recent weeks.

Meanwhile, southern safrinha regions are expected to see a more favorable moisture pattern develop. Areas including Paraná and southern Mato Grosso do Sul recently received heavy rainfall, with additional rounds of beneficial precipitation forecast during both the 6-10 day and 11–15-day windows. Those rains should help stabilize crop conditions and improve soil moisture profiles after earlier concerns about uneven development.

However, Paraná faces an immediate weather threat before the wetter pattern fully establishes. Overnight low temperatures are forecast to fall into the 30s tomorrow morning, creating a meaningful frost risk for safrinha corn in vulnerable areas. The cold snap could cause localized crop damage depending on crop stage and frost intensity, though temperatures are expected to moderate back toward near-normal levels afterward, limiting the duration of the threat.