China Continues Buying U.S. Soybeans, At Half-Way Mark for Pledged Purchases ‘This Season’

Farmdoc again focuses on crop insurance | Farmers like some of the conjectured farmer aid payment rates, but wonder why alleged soybean rate not higher 

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Link: 
Link: Video: Wiesemeyer’s Perspectives, Dec. 5
Link: Audio: Wiesemeyer’s Perspectives, Dec. 5

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Today’s Updates:
 

TRADE & GLOBAL MARKETS

— Sinograin moves soybean reserves as China signals steady weekly auctions
— U.S. soybean sales to China accelerate as Beijing tightens port quarantine rules
— USTR Greer urges Congress to lock in Trump’s tariffs
— GOP pushes Trump to rethink steel, aluminum tariffs as equipment costs soar
— Greer India’s trade offers mark a breakthrough for U.S. agriculture
— U.S. presses EU on trade deal compliance

USDA & FOOD POLICY

— Farm Bureau’s John Newton provides perspective on USDA aid spending and says recent aid is not enough support
— USDA launches $700 million regenerative ag pilot as six more states gain SNAP food-choice waivers
— USDA clarifies rules for voluntary “Product of USA” and “Made in the USA” labels

REGULATORY & INDUSTRY OVERSIGHT

— OMB begins meetings on USDA poultry and hog line-speed proposals

FINANCIAL MARKETS

— Equities today: Global stock markets mostly weaker
— Equities yesterday: Major U.S. indexes close higher
— Fed cuts rates again amid deep divisions on next steps
— Fed’s decision: Bullish into year-end, but not a long-term tailwind

AG MARKETS

— USDA daily export sales for 2025/26
— Additional U.S. wheat sales, soybean cancellations mark latest weekly 
    export data for China
— Argentina lowers grain export taxes
— Agriculture markets yesterday

FARM POLICY

— Zulauf warns USDA actions are sidestepping Congress on crop insurance costs

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ENERGY MARKETS & POLICY

— Thursday: Oil prices slip as market shifts back to peace talks
— Wednesday: Oil prices tick higher as U.S. seizes tanker, industry returns to 
     Gulf lease sales
— Gulf lease sale haul falls short of 2023 peak
— SK On ends U.S. battery JV with Ford

CONGRESS

— Ways & Means panel advances three-year AGOA renewal amid White House 
     reservations

HPAI / BIRD FLU

— Senators press USDA for action on bird flu vaccine plan

WEATHER

— NWS outlook: Atmospheric River waning; Arctic surge expanding; lake-effect
     and Midwest/Mid-Atlantic snows expected

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Updates: Policy/News/Markets, Dec. 11, 2025

UP FRONT— Sinograin soybean auctions: China sold 77.5% of this week’s soybean offer and is expected to continue weekly auctions totaling about 4 MMT as it manages reserves and weak crush margins.— U.S. soybean sales to China: Beijing purchased nearly 1 MMT of U.S. soybeans this week, even as new CIQ quarantine rules threaten to slow offloading and add demurrage costs.— Greer urges tariff codification: USTR Jamieson Greer says bipartisan interest is growing in cementing Trump’s tariffs into law as SCOTUS weighs challenges to IEEPA-based duties.— GOP presses Trump on metal tariffs: Republican senators want Trump to ease 50% steel and aluminum tariffs, arguing machinery cost inflation is hurting farmers more than existing aid.— Farm Bureau on USDA aid: Farm Bureau leaders say the new $12B relief package is essential but far from sufficient as producers continue facing high costs and multi-year financial strain.— Greer on India trade talks: USTR Greer says India’s latest offers are the “best ever,” signaling meaningful openings for U.S. ag exports as Washington seeks diversification beyond China.— U.S. presses EU on trade compliance: Greer warns tariff relief for the EU will depend on demonstrable follow-through on trade commitments under the U.S.–EU deal.— USDA regenerative ag pilot: USDA and HHS launched a $700M regenerative agriculture program and approved six more states for SNAP food-choice waivers, bringing the total to 12.— USDA updates origin-label guidance: FSIS clarified voluntary “Product of USA”/“Made in the USA” rules, tightening definitions and allowing “Product of North America” designations.— OMB meetings on poultry/hog line speeds: OMB begins stakeholder meetings on USDA’s proposed line-speed rules, signaling accelerated review of poultry and hog plant standards.— Equities today/yesterday: Global equities were mixed overnight; U.S. indexes closed higher Dec. 10, led by a 1% Dow gain.— Fed cuts rates again: The Fed delivered a divided 25-bp cut and signaled a possible pause, with 2026 projections showing stronger GDP but wide dispersion on rate paths.— Fed decision market impact (Sevens Report): The Sevens Report says the Fed was “not as hawkish as feared,” supporting a year-end rally but offering no lasting bullish shift.— USDA daily export sales: The U.S. reported sizable soybean and corn sales, including 264,000 MT of soybeans to China.— Weekly export sales: China booked more wheat but saw net soybean cancellations; modest beef and pork sales were also reported.— Argentina cuts export taxes: Argentina lowered export taxes on soybeans, corn, wheat, and byproducts to stimulate shipments and foreign-exchange earnings.— Ag markets yesterday: Grains were mostly lower; cattle and hog futures firmed.— Zulauf on crop insurance subsidies: Carl Zulauf warns USDA administrative changes have expanded ECO subsidies far beyond Farm Bill scoring, raising fiscal-integrity concerns.— Oil prices Thursday: Crude fell as markets shifted focus back to Russia-Ukraine peace talks despite unresolved tensions over a U.S. tanker seizure.— Oil prices Wednesday/Gulf lease sale: Oil ticked higher on news of a seized tanker, while the Gulf’s first lease sale since 2023 drew $279M with BP, Chevron, and Shell leading.— Gulf auction overview: The $279M haul fell $100M short of 2023 despite strong deepwater interest and lower 12.5% royalty rates.— SK On ends Ford JV: SK On will exit its U.S. battery JV with Ford, handing full ownership of the Texas plant to Ford amid EV-policy uncertainty.— AGOA renewal advances: Ways & Means advanced a three-year AGOA renewal despite the administration preferring one year to allow time for reforms.— Senators push USDA on bird flu vaccine: A bipartisan bloc urged USDA to finalize a science-based bird-flu vaccination plan as winter infections rise and industry divisions persist.— NWS outlook: Arctic air pushes into the Plains and Midwest, multiple snow events develop, and much-above-average temperatures prevail across the West and Southern Plains.TOP STORIES  — Sinograin moves soybean reserves as China signals steady weekly auctionsState stockpiler sells 77.5% of this week’s offer; Reuters reports 4 MMT in total sales expected as weekly volumes continue China’s state stockpiler Sinograin sold 397,000 metric tons (MMT) of soybeans out of the 512,500 MMT offered in this week’s auction, Reuters reported, citing two graders. The sale — amounting to 77.5% of available supplies — cleared at 3,935.3 yuan ($557.38) per MMT, with delivery scheduled from late December through March. According to Reuters, Sinograin is expected to continue offering 300,000–500,000 MMT of soybeans in weekly auctions, with total sales projected to reach roughly 4 MMT as China manages reserves and supports domestic crush demand. — U.S. soybean sales to China accelerate as Beijing reportedly tightens port quarantine rulesPurchase pace nears 1.0 MMT for the week; new CIQ measures could slow vessel offloading China is rumored to have bought another 400,000–500,000 MT of U.S. soybeans on Wednesday (USDA announced 264,000 MT to China this morning and another 226,000 MT of soybeans to unknown destinations), pushing total weekly purchases close to 1.0 MMT Chinese purchases since the Trump/Xi deal now total 6.0–6.5 MMT — more than halfway toward the 12.0 MMT pledge for the end of the season.  Meanwhile, reports have surfaced that China’s CIQ has begun enforcing stricter quarantine procedures on newly arrived soybean cargoes from South America. The tighter rules could delay offloading by up to 20 days and raise demurrage costs. Analysts say China is trying to manage an oversupplied soybean market and weak crush margins that have pressured domestic processors. — USTR Greer urges Congress to lock in Trump’s tariffsUSTR says bipartisan interest is growing in making tariff policy permanent U.S. Trade Representative Jamieson Greer said Congress should consider codifying President Donald Trump’s tariff regime to ensure the strategy endures beyond the current administration. Speaking at a Dec. 9 Atlantic Council event, Greer revealed that several lawmakers — including some who traditionally oppose tariffs — have approached him about writing the duties into law. SCOTUS decision ahead. Greer noted that Trump’s tariffs, enacted under economic emergency declarations via the International Emergency Economic Powers Act, are now facing Supreme Court challenges. Codification, he argued, would “provide a new baseline” for companies and signal that the approach reflects bipartisan priorities around supply-chain reshoring and narrowing the trade deficit. While acknowledging the legislative path would be “challenging,” Greer said the idea is gaining traction.  Greer also floated a “global baseline” tariff structure, allowing presidents to adjust rates based on deficits or unfair trade practices to push countries “into the fold.” Momentum is already building in the House. Ways & Means trade subcommittee Chair Adrian Smith (R-Neb.) said in October that Congress must be prepared to codify Trump’s agreements to secure long-term commitments. A bipartisan bill introduced in August by Rep. Greg Steube (R-Fla.) and Rep. Jared Golden (D-Maine) would cement a 10% baseline tariff and levy 100% duties on certain strategic Chinese goods. Greer said a China-specific tariff statute is unnecessary if Congress pursues a broader global framework.  But any codification bill would face significant resistance in the Senate, where several Republicans joined Democrats in October to vote for resolutions ending the economic emergencies underpinning Trump’s tariffs on Brazil, Canada, and other partners. Those measures are unlikely to advance in the House after Republicans changed chamber rules to block fast-track consideration. — GOP pushes Trump to rethink steel, aluminum tariffs as equipment costs soarLawmakers say removing tariffs could help farmers more than existing aid programs Republican senators are pressing President Donald Trump to scale back or eliminate his 50% steel and aluminum tariffs, arguing that the policy is inflating machinery costs and undermining the very farm sector the administration is trying to support, Politico reports. With the first round of farm aid largely in place, several GOP lawmakers said they’ve urged the White House to revisit the tariffs as a more direct way to ease pressure on producers. Sen. Chuck Grassley (R-Iowa) said he raised the issue with administration officials this week, noting that removing tariffs on machinery components “would do more good than the $11 billion that went out of the Commodity Credit Corporation.” That may be an overstatement, but the costs of fixing farm equipment is frequently listed by farmers as a key drag on the sector.  Sen. John Hoeven (R-N.D.) said Trump indicated he would “look at the tariffs again” during a Monday conversation, while Sen. Jerry Moran (R-Kan.) pushed for swift trade agreements that could also pave the way to reducing metal duties. The White House did not comment on the lawmakers’ specific requests, but deputy press secretary Anna Kelly said Trump’s $12 billion aid package “reflects the President’s commitment to helping our farmers.” Trump briefly addressed the farm equipment issue at a roundtable, blaming “environmental restrictions” for raising equipment prices and urging manufacturers — including Deere, which warned of continuing 2026 weakness partly due to tariffs — to cut tractor prices.  However, some industry analysts note that one of the reasons Deere raised its farm equipment prices followed the big contract the management signed with UAW workers. Farm equipment sticker shock. Producers say machinery is one of the most painful cost pressures they face — especially as purchases are infrequent but unavoidable.  Some lawmakers are targeting ancillary issues: Sen. Pete Welch (D-Vt.) has introduced a bill mandating manufacturers provide tools and parts to enable more affordable repairs. But farm groups argue the core problem remains the metal tariffs themselves. — Farm Bureau’s John Newton provides perspective on USDA aid spending and says recent aid is not enough support. Newton notes that so far, only $18 billion has gone out the door collectively. The $10 billion in SDRP should come soon (but this category will eventually likely include top-up payments for both Stage 1 and Stage 2).   Farm Bureau’s Zippy Duvall says aid offers essential short-term support, but long-term challenges remain for U.S. agriculture. USDA’s new $12 billion farm relief package is being greeted with genuine gratitude across rural America, but farm leaders stress that the assistance covers only a fraction of the financial strain facing producers. In an article authored by Zippy Duvall, president of the American Farm Bureau Federation, he writes that the payments “will help farm families cover critical operating costs, keep equipment running and secure financing for next season with a little less uncertainty hanging over their heads.” Duvall emphasizes that for many producers, the support is not optional: “For many farmers, this support isn’t just helpful, it’s essential.” Bridge support, not a full fix. Duvall notes that ongoing trade volatility, lower commodity prices and rising input costs have pushed farms “to the brink,” and he credits the administration for delivering resources that could determine whether many family operations survive another season. But he also highlights the size of the gap still remaining. Specialty crop growers — fruit, vegetable, tree-nut and nursery operations — received less than 10% of the bridge assistance despite facing similar surges in production costs. “Farmers have weathered billions in economic losses that have only been partially offset by this bridge support,” he writes, pledging Farm Bureau’s continued push for Congress and the administration to expand aid where needed. Relief arrives as other ag policy moves advance. Duvall links the payment rollout to several recent developments he sees as positive for agriculture: • Whole Milk for Healthy Kids Act: He highlights the Senate’s bipartisan vote as a meaningful victory for dairy farmers and families seeking more nutritious school options.• New Waters of the U.S. proposal: The updated WOTUS rule “brings clarity and common sense” to land and water regulation—exactly the kind of certainty farmers have sought.• Year-round E15 push: Duvall recounts a recent White House meeting where he pressed for permanent E15 availability, calling recent steps “promising” for farmers and consumers. Progress acknowledged, but scale of challenges remains. Despite these signs of momentum, Duvall warns that the farm economy remains mired in a “deep, prolonged downturn.” The $12 billion relief package is a necessary first step, he writes, but “the need is far greater,” as years of economic strain have “taken a heavy toll.” Farm Bureau, he says, will continue working with Washington to ensure assistance matches the magnitude of what farm families have endured. The message from the nation’s largest farm organization is clear: the relief is welcome, but the runway ahead is long — and the farm economy is far from stabilized. Comments: After talking with farmers at an MKC event Wednesday in Newton, Kansas, several farmers said they were pleasantly surprised about the conjectured payment rate for some commodities relative to the $11 billion being offer to row-crop producers. However, they were surprised about how low the conjectured soybean payment rate was relative to corn sorghum and wheat rates. — Greer India’s trade offers mark a breakthrough for U.S. agricultureUSTR touts “best we’ve ever received” proposals as Washington seeks to diversify beyond China U.S. Trade Representative Jamieson Greer told senators that India’s latest proposals in bilateral trade talks are “the best we’ve ever received,” signaling what he called a major opportunity to expand agricultural exports at a moment when China’s purchases have become less reliable due to tariff tensions. Speaking at a Senate appropriations hearing, Greer said an eventual U.S./India agreement would be “key” to broadening markets for U.S. producers, particularly as China halted most U.S. soybean buying for much of 2025 — a move that helped trigger the administration’s new $12 billion farm aid package. Greer cited India’s potential, especially for grain sorghum and other row crops, in response to questioning from Sen. Jerry Moran (R-Kan.), who asked how the administration planned to adapt its trade strategy amid China’s pullback. Greer said India has been “quite forward-leaning,” noting a USTR team is in New Delhi now and Deputy USTR Rick Switzer is also meeting with Indian officials as part of negotiations toward a bilateral trade agreement. While touting President Trump’s October deal with Chinese President Xi Jinping — including commitments for China to buy 12 MMT of soybeans this season and 25 MMT annually for the next three years — Greer stressed the importance of diversification. He cited recent tariff reductions from Vietnam and Cambodia and emphasized that the administration is “trying to touch every base” to expand market access. Greer acknowledged ongoing resistance in India on some row crops and meats but said the current talks represent unprecedented progress.  “They need our beans. They need our sorghum. They need all of this,” he added of China, while reiterating that U.S. farmers ultimately want “free, unfettered access into every market in the world” — something he said the administration is advancing across multiple fronts. Of note: Greer said the Office of the U.S. Trade Representative has “never been busier” and needs more funding and personnel to ensure the Trump administration’s new trade deals can be enforced. He defended what one senator called a record-high budget request. — U.S. presses EU ON trade deal complianceGreer warns tariff relief contingent on Europe meeting commitments U.S. officials are sharpening their focus on whether the European Union is fully honoring the commitments it made under the U.S./EU trade deal, cautioning that tariff benefits will not continue without measurable follow-through from Brussels. In a late-Tuesday (Dec. 9) hearing, U.S. Trade Representative Jamieson Greer told lawmakers that if the EU fails to deliver on its obligations, “they won’t receive the benefit of the tariff relief they’ve been granted.” While the broader U.S./EU trade relationship remains stable, it continues to be strained by ongoing U.S. tariffs — even as some EU member states have taken steps to reduce duties on U.S. agricultural exports. — USDA launches $700 million regenerative ag pilot as six more states gain SNAP food-choice waiversRollins and Kennedy unveil streamlined conservation enrollment; food-purchase limits expand to 12 states starting in 2026 USDA Secretary Brooke Rollins and Health and Human Services Secretary Robert F. Kennedy Jr. on Wednesday announced a $700 million Regenerative Pilot Program designed to accelerate soil-health improvements, strengthen water quality, and boost long-term farm productivity. The initiative aims to cut red tape by creating a single, whole-farm application that covers multiple conservation programs, making it easier for new and beginning farmers to participate. The department earmarked $400 million through EQIP and $300 million through CSP for the pilot’s first year. USDA says the effort will also launch new public/private partnerships with NRCS to match private capital with federal conservation dollars. Farmers can now apply for FY 2026 funding for both EQIP and CSP through the consolidated regenerative application process. Separately, USDA approved six additional states — Hawaii, Missouri, North Dakota, South Carolina, Virginia, and Tennessee — for SNAP food-choice waivers beginning in 2026. With these additions, 12 states now have authority to restrict what foods SNAP recipients may purchase, following earlier waivers for Arkansas, Idaho, Indiana, Iowa, Nebraska, and Utah. USDA says most of the state proposals aim to steer consumers toward healthier purchasing patterns. — USDA clarifies rules for voluntary “Product of USA” and “Made in the USA” labelsFSIS issues updated guidance on origin claims, multi-ingredient products, and allowable North America designations USDA’s Food Safety and Inspection Service (FSIS) has released updated guidance (link) refining how companies may use voluntary “Product of USA” and “Made in the USA” labels. The updates respond to comments received during a 60-day review of the agency’s March 18, 2024, guidance and address additional questions that have emerged since. FSIS said several revisions are aimed at clarifying the criteria for origin claims, particularly for livestock. The agency now specifies that “raised” means from birth to slaughter, while “harvested” is defined as “slaughtered.” Adjustments were also made for multi-ingredient products to clarify how the origin of non-meat ingredients should be treated relative to the primary component. The updated guidance also confirms that voluntary claims such as “Product of North America” and “Product of USA and Canada” are permissible. However, FSIS made clear that “produced” may not be used as a stand-alone origin claim, tightening the language allowed under voluntary labeling standards. Upshot: FSIS said the revisions are intended to assist companies in accurately representing product origins and ensuring consistency across label claims. — OMB begins meetings on USDA poultry and hog Line-Speed ProposalsIndustry, labor and environmental groups line up as review process accelerates The Office of Management and Budget (OMB) is set to hold a series of meetings over the next week on two USDA proposed rules addressing processing line speeds at chicken and hog plants. The National Chicken Council and a coalition representing poultry plant workers have each requested sessions to discuss the poultry rule, while the Meat Institute is slated to weigh in on the hog plant proposal. The Center for Biological Diversity will meet with OMB on both plans, underscoring the broad stakeholder interest. The Trump administration has not set a formal deadline for the rulemakings, which were delivered to OMB on Dec. 5. USDA’s regulatory agenda had previously targeted September 2025 for release of the notices of proposed rulemaking, but the stepped-up meeting schedule suggests the review process is already gaining momentum.

FINANCIAL MARKETS

— Equities today: Global stock markets were mostly weaker overnight. U.S. stock indexes are pointed to lower openings. In Asia, Japan -0.9%. Hong Kong flat. China -0.7%. India +0.5%. In Europe, at midday, London +0.2%. Paris +0.4%. Frankfurt +0.1%.

— Equities yesterday:

Equity Index	Closing Price  Dec. 10	Point Difference  from Dec. 9	% Difference  from Dec. 0
Dow	48,057.75	+497.46	+1.05%
Nasdaq	23,654.16	+77.67	+0.33%
S&P 500	6,886.68	+46.17	+0.67%

— Fed cuts rates again amid deep divisions on next steps

Powell signals policy pause as 2026 forecasts show stronger growth, slightly cooler inflation

The Federal Reserve lowered the federal funds rate by 25 basis points to a 3.5%–3.75% range, marking another non-unanimous decision as policymakers diverged sharply over the appropriate pace of easing. One governor pushed for a larger cut while two regional presidents preferred to hold steady — underscoring the growing split within the Federal Open Market Committee (FOMC).

Pause now possible. While the post-meeting statement changed only slightly, Fed Chair Jerome Powell signaled that the central bank may now be positioned to pause rate adjustments, stressing that policy has moved into “a broad range of estimates of neutral.”

Divided vote highlights policy uncertainty. The 9–3 vote reflected widening differences among officials:

• Gov. Stephan Miran sought a 50-bp cut.

• Kansas City Fed President Jeffrey Schmid and Chicago Fed President Austan Goolsbee wanted no cut.

Powell said disagreement was not about inflation’s direction — “everyone agrees inflation is too high” — but how to weigh risks to jobs and price stability.

The statement’s only notable change: the Fed now views reserve balances as having “declined to ample levels” and will begin Treasury bill purchases to maintain sufficient reserves and keep the funds rate within target.

New forecasts: One cut in 2026, higher GDP, slightly lower inflation. The Fed’s Summary of Economic Projections (SEP) reaffirmed expectations for one rate cut in 2026, but revealed far wider internal dispersion.

2026 outlook vs. September:

• GDP: 2.3% (up from 1.8%).

• Unemployment: 4.4% (unchanged).

• PCE inflation: 2.4% (down from 2.6%).

• Core PCE: 2.5% (down from 2.6%).

But views on where rates should be by end-2026 have fractured:

• 3 officials see a rate rise (essentially signaling they opposed this month’s cut).

• 4 see steady rates.

• 4 see one cut.

• 4 see two cuts.

• 3 see three or more cuts.

Powell emphasized that these differences reflect the unusual economic moment: “It is not like the normal situation where everyone agrees on the direction … it is more spread out.”

Powell: Fed likely able to hold steady — but data ahead will drive decisions. Powell suggested the Fed is now close to neutral after 75 bps of cuts since September and 175 bps over the past year, giving policymakers room to wait and see.

He warned, however, that upcoming data may be distorted by the government shutdown and technical issues.

Other key messages from Powell:

• Growth outlook improving: shutdown-adjusted projections imply 2026 GDP closer to 2.1%, not 2.3%.

• Productivity gains may allow stronger growth without overheating labor markets.

• Goods inflation is elevated due to tariffs but should peak in early 2026 assuming no new tariff actions.

• Labor market weaker than reported: Powell said employment data likely overstates job gains by ~60,000 per month.

He avoided commenting on the potential impact of a Supreme Court ruling on the administration’s use of IEEPA for tariffs and brushed off political questions about President Donald Trump’s upcoming Fed chair selection.

Bottom Line: Still a data-driven Fed, still deeply split. Powell’s message: the Fed is inclined to hold steady, but nothing is locked in. Data will determine the January decision — and policymakers acknowledge the data itself may be hard to interpret.

The combination of:

• a fractured FOMC,

• uncertain labor readings,

• tariff-distorted inflation, and

• shutdown-affected data

means markets should expect continued volatility in expectations rather than a firm path.

As of now, the CME FedWatch tool places the odds of a January hold at nearly 78%, reflecting Powell’s signal that the Fed is “well positioned to wait and see how the economy evolves.”

— Fed’s decision: Bullish into year-end, but not a long-term tailwind

Sevens Report says the move “wasn’t as-hawkish-as-feared,” boosting near-term risk appetite but offering no lasting bullish shift

The latest Federal Reserve decision provides markets with a clear short-term boost but not a durable bullish foundation, according to the Sevens Report analysis. Although the Fed cut rates by 25 bps as expected, the key market catalyst was what the Fed didn’t do: it avoided delivering a more hawkish surprise. That alone helped remove a major “land mine” that could have disrupted an ongoing year-end rally. 

Bullish short-term: Fed avoids hawkish surprise, supports Santa rally. The Sevens Report says the Fed’s outcome “will be to support a year-end rally and the reason is clear: The Fed wasn’t as-hawkish-as-feared.” 

The most important market-moving development was the announcement that the Fed would purchase $40 billion in short-term Treasury bills over the next 30 days to maintain liquidity. While the move is not true quantitative easing, investors viewed the timing as a dovish surprise. “Right now, investors just want to avoid any surprise ‘land mines’ that could disrupt the year-end rally and the Fed met that goal yesterday. As such, it did make a Santa Claus rally more likely.” — Sevens Report

Stocks rallied on the combination of:

• No hawkish shock in the statement

• A liquidity boost via T-bill purchases

• Powell’s reassurance that rate hikes are not on the table

• Seasonal and momentum-driven tailwinds

Powell emphasized downside labor-market risks rather than inflation, another factor traders interpreted as dovish at the margin.

Not bullish long term: Cuts paused, policy split, and no return to QE. Despite the market-friendly reaction, the report stresses that this is not a medium- or long-term bullish inflection point. “The Fed decision yesterday is not a bullish gamechanger beyond the short term and instead it’s more neutral.” — Sevens Report 

Three structural negatives limit the longer-term upside:

1. Cuts Are Paused Heading Into 2026. The Fed revived language about “the extent and timing of additional adjustments,” signaling that future cuts are uncertain. “It still means we’ll start 2026 without the tailwind of an easing Fed.” — Sevens Report

2. Deepening policy divisions. Two hawkish dissents favored no rate cut at all—suggesting greater fragmentation once a new Fed chair arrives in 2026. “We can expect the Fed to remain divided (perhaps even more divided) once a new and presumably more-dovish Fed chair takes over in 2026.” — Sevens Report 

3. No new stimulus: Liquidity not equal to QE. The T-bill purchases support year-end functioning but do not represent a return to asset-expansion policies that powered past bull markets. “They aren’t sustainably adding liquidity like they do in QE… What was announced yesterday is not Quantitative Easing.” — Sevens Report

Bottom Line from the report: “The Fed wasn’t as-hawkish-as-feared… But don’t confuse what happened yesterday with an on-balance positive.”

AG MARKETS

— USDA daily export sales for 2025/26:
• 264,000 MT of soybeans to China

• 186,000 MT corn to unknown destinations

• 226,000 MT of soybeans to unknown destinations

— Additional U.S. wheat sales, soybean cancellations mark latest weekly export sales data for China. USDA issued the weekly Export Sales update for the week ended Nov. 13, including activity for 2025/26 to China of net sales of 60,000 metric tons of wheat,  net reductions of 110,000 metric tons of soybeans (presumably this was included in the major daily sales announcement that USDA issued following the restart of government operations which it subsequently corrected to say that 100,000 metric tons of soybean sales that took place Nov. 3 had been canceled), and net sales of 5,739 running bales of upland cotton. Sales activity for 2025 included net sales of 145 metric tons of beef and 1,848 metric tons of pork. But USDA also announced that 559 metric tons of pork sales for 2026 were canceled, leaving the outstanding sales total at 658 metric tons.

— Argentina lowers grain export taxes. Argentina will lower export taxes on grains and soybeans as it seeks to bolster export revenues, with Economy Minister Luis Caputo saying on X that the levy for soybeans will fall to 24% (26% prior) and soybean byproducts will be at 22.5% (24.5% prior). Wheat and barley export taxes will fall to 7.5% (9.5% prior) while corn and sorghum export taxes would be at 8.5% (9.5% prior). Caputo said the adjustments were a “permanent reduction” in the taxes. The new levels will take effect once the notice is published in the Official Gazette.

— Agriculture markets yesterday: 

Commodity	Contract Month	Close Dec. 10	Change vs  Dec. 9
Corn	Mar	4.44 1/4	-3 3/4
Soybeans	Jan	10.91 1/4	+4
Soybean Meal	Jan	301.20	-0.10
Soybean Oil	Jan	0.5109	+0.07
Wheat SRW	Mar	5.29 1/2	-5
Wheat HRW	Mar	5.23 1/4	-3 3/4
Spring Wheat	Mar	5.75 1/4	-1
Cotton	Mar	0.6412	+0.26
Live Cattle	Feb	228.525	+1.575
Feeder Cattle	Jan	338.375	+2.875
Lean Hogs	Feb	82.425	+0.55

FARM POLICY

— Zulauf warns USDA actions are sidestepping Congress on crop insurance costs

Farmdoc Daily analysis says administrative moves have boosted premium subsidies three times more than the 2025 Farm Bill — raising concerns about fiscal integrity

Drawing on his farmdoc daily article, Carl Zulauf of Ohio State University argues that the federal budget process is being undermined by administrative actions that have dramatically expanded federal crop insurance premium subsidies outside the Farm Bill framework. Link to report. 

Zulauf notes that while the “2025 Farm Bill” increased premium subsidies by an estimated $4.4 billion over 10 fiscal years, USDA’s Risk Management Agency (RMA) unilaterally implemented far larger subsidy hikes for the Enhanced Coverage Option (ECO). Two administrative actions — first raising ECO subsidy rates in 2024, then lifting them again in 2025 to 80% — are conservatively projected to add $13.2 billion in federal costs over the same period, according to Zulauf’s calculations.

These actions triggered a massive surge in ECO enrollment, with insured acres jumping from 15.6 million in 2024 to 61.8 million in 2025, and subsidies rising six-fold in a single year.

Zulauf writes that the discrepancy illustrates how “administrative actions can be used to circumvent the Federal budget scoring process,” calling into question both the fiscal integrity and usefulness of the government’s budgeting framework — since the largest cost increases are emerging outside the legislative process intended to set subsidy levels.

He also details how other subsidy adjustments in the 2025 Farm Bill — such as higher rates for basic and optional units and raising the SCO subsidy to 80% — collectively account for far less of the federal spending increase than the ECO changes made entirely through USDA authority.

Overall, Zulauf’s analysis flags a widening gap between congressionally scored budget decisions and administrative maneuvers with far greater fiscal impact, raising new policy and governance concerns for lawmakers and budget overseers.

ENERGY MARKETS & POLICY

— Thursday: Oil prices slip as market shifts back to peace talks

Focus returns to Russia/Ukraine negotiations despite tensions over U.S. tanker seizure

Oil prices eased on Thursday as traders refocused on diplomatic efforts to advance Russia/Ukraine peace talks while continuing to watch for fallout from Washington’s seizure of a sanctioned tanker off Venezuela. Brent crude fell 81 cents, 1.3%, to $61.40 a barrel, while WTI dropped 78 cents, 1.3%, to $57.68.

Russian Foreign Minister Sergei Lavrov said U.S. envoy Steve Witkoff’s visit to Moscow had resolved several bilateral misunderstandings and that Russia had delivered its collective security proposals to Washington. The comments came as markets digested Wednesday’s brief price rebound tied to the tanker seizure, which analysts say could still spark volatility if tensions deepen. The incident has not yet affected supply flows any escalation will raise volatility. Traders reported Asian buyers demanding steep discounts on Venezuelan crude amid rising volumes of sanctioned oil from Russia and Iran and increased loading risks tied to stepped-up U.S. military activity in the Caribbean.

Meanwhile, Western leaders held a joint call with President Donald Trump to coordinate on what they described as a “critical moment” in Ukraine peace efforts. The conflict’s spillovers persisted, with Ukrainian drones striking a Russian Caspian Sea oil rig for the first time, halting production, according to a source at Ukraine’s Security Service (SBU) cited by Reuters.

Adding to the market’s crosscurrents, the International Energy Agency raised its 2026 global oil demand forecast while trimming supply expectations, pointing to a slightly tighter balance next year. In the U.S., a sharply divided Federal Reserve cut interest rates — an action that could support economic activity and, indirectly, future oil demand.

— Wednesday: Oil prices tick higher as U.S. seizes tanker, industry returns to Gulf lease sales

Geopolitical tensions rise while major producers snap up prime deepwater acreage

Oil prices inched higher Wednesday after U.S. officials confirmed the seizure of an oil tanker off the coast of Venezuela, a move that injected fresh geopolitical risk into an already fragile market. Brent settled at $62.21, up $0.27, while WTI closed at $58.46, a gain of $0.21. Analysts said the U.S. Coast Guard action raises the prospect of similar interdictions but does not immediately change global supply dynamics.

The development coincided with the federal government’s first Gulf of Mexico offshore lease sale since 2023, where BP, Chevron, and Shell dominated bidding for high value deepwater tracts. BP led the activity with 51 blocks secured for about $61.9 million. Chevron posted the auction’s top single bid at nearly $18.6 million for a Keathley Canyon block, while Shell won 12 blocks totaling roughly $16.2 million.

Other successful bidders included Anadarko, LLOG Exploration Offshore, Talos Energy, Murphy Exploration & Production, and a joint Woodside/Repsol bid for a prized Walker Ridge block. Overall, the sale generated $279 million in high bids, reflecting heightened industry interest as the Trump administration rolls out its 30-sale offshore leasing program with a reduced 12.5% minimum royalty rate. Interior officials said the more predictable auction calendar is helping companies more precisely target and plan their acreage strategies.

— Gulf lease sale haul falls short of 2023 peak

First Gulf oil and gas auction since 2023 brings in $279M as fewer companies compete and royalty rates drop

The first federal sale of oil and natural gas drilling rights in the Gulf of America since 2023 generated $279.4 million in high bids, roughly $100 million less than the previous auction two years earlier. Despite the lower total, the auction delivered the strongest per-acre bids since 2017, driven largely by BP, Woodside Energy, and Chevron.

According to the Bureau of Ocean Energy Management (BOEM), 30 companies submitted 219 bids across 1.02 million acres — just 1.3% of the 81.2 million acres offered. Only 30 blocks drew multiple bids, underscoring the subdued competition amid a packed calendar of 30 scheduled auctions.

BP dominated the sale, winning 50 tracts and submitting $61 million in total high bids. Woodside followed with $38 million, Chevron with $33 million, and Murphy Exploration & Production with $27.4 million. Chevron also placed the auction’s single highest bid, offering $18.6 million for a deepwater Keathley Canyon block.

This year’s auction featured the lowest allowable royalty rate — 12.5%, a drop from the prior 16.65% minimum. Still, the reduced cost structure did not offset broader market hesitancy, as the overall take fell well short of the $382 million raised in the 2023 sale.

— SK On ends U.S. battery JV with Ford

Ownership of Texas plant shifts to Ford as EV policy uncertainty mounts

South Korea’s SK On said it will terminate its joint venture with Ford on U.S. battery production, part of a broader restructuring aimed at refocusing the company on growth areas such as energy storage systems. Under the transition, a Ford subsidiary will assume full ownership and operation of the Texas battery plant.

SK On noted that the production start date “remains flexible,” citing the timing of the ownership shift. The move underscores continued turbulence in the electric-vehicle sector, driven by the loss of U.S. EV purchase incentives and shifting regulatory requirements — factors that have reshaped investment plans across automakers and battery suppliers.
 

CONGRESS

— Ways & Means panel advances three-year AGOA renewal amid White House reservations

Committee approves shortest-ever extension as administration signals preference for one-year reauthorization

The House Ways & Means Committee on Wednesday approved a three-year renewal of the African Growth and Opportunity Act (AGOA), advancing the expired preference program despite clear indications that the Trump administration prefers only a one-year extension.

AGOA, which lapsed on Sept. 30, provides duty-free access for qualifying sub-Saharan African exports and has historically enjoyed broad bipartisan support. The committee voted 37–3 to advance the clean three-year renewal to the full House, though it remains uncertain whether President Trump would sign the bill.

During Senate testimony this week, U.S. Trade Representative Jamieson Greer told appropriators that the administration supports only a one-year renewal to allow time for shared work on revamping AGOA. “We’re open to a one-year clean reauthorization,” Greer said, adding that Congress and the administration should spend the year determining how to modernize the 20-year-old program.

Ways & Means Chair Jason Smith (R-Mo.), the bill’s sponsor, argued that a three-year extension is necessary to provide certainty while lawmakers develop a comprehensive, reform-oriented long-term plan. But the gap between the committee’s approach and the administration’s position raised immediate questions during the markup. Asked whether the White House supports a three-year renewal, GOP Chief Trade Counsel Josh Snead said the administration had only endorsed a “short-term extension.”

Democrats broadly backed the legislation but voiced concerns that AGOA renewal should be paired with Trade Adjustment Assistance reauthorization and program reforms. Rep. Terri Sewell (D-Ala.) called the three-year extension the “bare minimum” needed to restore confidence and investment, while emphasizing her desire for a longer renewal and modernization of AGOA’s oversight, supply-chain focus and graduation provisions. TAA has been expired since 2022.

Other members warned that delaying reforms could stretch beyond the three-year window. Rep. Steven Horsford (D-Nev.) sought to attach amendments restoring congressional authority over tariffs, reinstating TAA, and directing the administration to assess AGOA’s impact on domestic supply chains and mineral production. All were rejected on party-line votes.

Smith defended a clean extension, saying that any changes risked derailing the fragile bipartisan effort to revive the program. “When it expired on Sept. 30, we needed to figure out a way to bring the program back until there’s additional reforms,” he said.

Smith also framed the renewal as a strategic counterweight to China’s deepening economic engagement in Africa, particularly in critical minerals. But Greer suggested in his testimony that China’s expanding presence demonstrates AGOA’s shortcomings: “Over the past 20 years we’ve seen, frankly, China move into Africa … so it makes you wonder if AGOA was functioning how it should.”

Greer concluded that any revived AGOA must be made “more effective” to prevent China from continuing to widen its trade advantage, which surpassed $1 trillion this year.

HPAI/BIRD FLU

— Senators press USDA for action on bird flu vaccine plan

Bipartisan lawmakers urge Rollins to finalize science-based strategy as winter infections rise

A bipartisan group of U.S. senators is urging the Trump administration to expedite and finalize a science-driven national plan for a bird flu vaccine, warning that rising winter infections demand swift federal action, according to a letter obtained by Reuters.

More than 180 million poultry have been culled since the outbreak began in 2022, and while USDA said in June it was developing a potential vaccination framework, it has not released any details. In their letter to USDA Secretary Brooke Rollins, 23 senators called for “renewed action,” emphasizing that any strategy must incorporate feedback from veterinarians, producers, and scientific experts.

Key senators behind move. Led by Sen. Amy Klobuchar (D-Minn.), the top Democrat on the Senate Ag Committee, and Sen. Mike Rounds (R-S.D.), the push includes Majority Leader John Thune (R-S.D.) and several Ag  Committee members from both parties.

The senators highlighted the need to balance rapid scientific progress with potential trade implications, noting that the poultry industry remains divided over vaccination due to concerns about export restrictions. They urged USDA to coordinate closely with trading partners as it finalizes its approach.

USDA in March committed $100 million for vaccine and therapeutic research for egg-laying hens — a key driver of soaring egg prices — and later reported receiving 417 proposals, though the department has provided no updates.

The push comes amid broader political friction over federal vaccine policy: in May, the Trump administration canceled a $700 million Moderna contract for a human bird flu vaccine, and Health Secretary Robert F. Kennedy Jr. has since rolled back multiple federal vaccine programs and long-standing guidance.

USDA told Reuters in late November that it has not shared any poultry vaccination plan with international trading partners.

WEATHER

— NWS outlook: Ongoing Atmospheric River event over the Pacific Northwest to diminish today… …Arctic air surges south into the Northern Plains late today and Friday;

Upper Midwest this weekend… …Active lake effect snows downwind of Lakes Erie and Ontario… …Fast moving low to bring moderate to heavy snows from the Mid Mississippi Valley into the Central Appalachians; Mid-Atlantic this weekend… …Much above average temperature expected from the West coast, across the Rockies, Central to Southern Plains into the Lower Mississippi Valley.