FSA Eases Loan Rules, Allows Use of Ad Hoc Payments as Farm Finances Tighten
October export jump fails to close U.S. ag trade gap at start of FY 2026 | Supreme Court weighs Trump tariffs and Bayer pesticide case in high-stakes decisions
| LINKS |
Link: Video: Wiesemeyer’s Perspectives, Jan. 4
Link: Audio: Wiesemeyer’s Perspectives, Jan. 4
| Updates: Policy/News/Markets, Jan. 9, 2026 |
| UP FRONT |
TOP STORIES
— Supreme Court weighs Trump tariffs and Bayer pesticide case: Justices consider rulings that could force billions in tariff refunds and determine whether Roundup cancer litigation reaches the high court, with major implications for trade authority and pesticide liability.
— October export jump fails to close U.S. ag trade gap: Strong early FY 2026 export growth narrowed but did not erase the agricultural trade deficit, which has now persisted for 22 straight months.
— OMB calendar fills up as Treasury’s 45Z review accelerates: A surge of stakeholder meetings signals momentum toward near-term guidance on the Clean Fuel Production Credit, likely applying to the 2025 tax year.
— Brazilian egg exports hit record as U.S. demand surges: Shipments more than doubled in 2025, with the U.S. as top buyer before tariffs redirected trade toward Asia and other markets.
— U.S./India trade talks stalled after Modi skipped Trump call: Commerce Secretary Lutnick says a missed leader call derailed a near-final deal, triggering steep tariffs and renewed pressure over India’s Russian oil purchases.
— Trump signals escalation with potential land strikes on Mexican cartels: The president hints at expanded military action beyond maritime interdictions, raising sovereignty, legal, and diplomatic concerns.
— Trump says his power is limited only by his ‘own morality’: In a New York Times interview, Trump downplayed constraints from courts, Congress, and international law, embracing coercive diplomacy and unilateral authority.
— Markets today: Global equities edge higher ahead of jobs data as investors await Supreme Court clarity on Trump tariffs; U.S. stocks were mixed Thursday. Traders await today’s Jobs report.
— Trump orders $200B mortgage bond purchase: White House aims to push down mortgage rates as part of a broader housing affordability agenda.
— Atlanta Fed nearly doubles Q4 growth estimate to 5.4%: GDPNow upgrade reflects a sharply narrower trade deficit and stronger services activity, even as inflation risks linger.
— Gold and silver face selling pressure on index rebalance: Precious metals see outflows tied to benchmark changes, while cocoa stands out as a beneficiary of index-driven buying.
— Ag markets: USDA reports additional U.S. sorghum, soybean, and livestock product sales to China; grain markets softened while livestock futures rose.
— FSA eases loan rules as farm finances tighten: USDA allows greater flexibility in using projected program and disaster payments and extending operating loan terms amid margin pressure.
— Senate Democrats press USDA on disaster aid delays: Lawmakers warn slow payouts could leave specialty crop producers without clarity until late in the 2026 planning season.
— House Ag GOP readies updated skinny farm bill: Republicans target a February committee markup, pending CBO scores and leadership support.
— Oil prices rise on geopolitical supply risks: Venezuela and Iran tensions lift crude despite expectations of global oversupply in 2026.
— Diesel prices fall for seventh straight week: Ample supply and OPEC+ restraint push U.S. diesel to its lowest levels since mid-November.
— Senate Ag GOP eyes spending bills to secure year-round E15: Lawmakers see must-pass funding as the best path to break the long-running ethanol stalemate.
— DOE scraps disputed EV fuel-economy formula: Agency withdraws its 2024 rule after an Eighth Circuit rebuke, restoring pre-2024 calculations.
— EU poised to clear Mercosur trade deal: Member states move toward approving the bloc’s largest-ever FTA despite fierce farm and environmental opposition.
— House advances full-year funding minibus: Bipartisan vote moves three bills to the Senate, but six more remain before the Jan. 30 shutdown deadline.
— Global food prices slide for fourth month: FAO index hits its lowest level since January 2025 as dairy, meat, and oils weigh, despite higher annual averages.
— Trump administration launches dietary guidelines roadshow: Officials promote a protein-heavy, whole-foods diet, criticize ultraprocessed foods, and signal tougher SNAP stocking rules.
— Weather: Heavy rain and severe weather threaten parts of the Lower Mississippi Valley and Southeast, with heavy snow expected in the Central and Southern High Plains.
| TOP STORIES—Supreme Court weighs Trump tariffs and Bayer pesticide case in high-stakes decisionsRulings could trigger tariff refunds and determine whether Roundup cancer litigation reaches the high court The U.S. Supreme Court is poised to act today on two cases with major financial and policy implications — one involving the legality of tariffs imposed by Donald Trump, and another centered on Bayer’s mounting liability over its Roundup herbicide. Tariffs: billions at stake for the federal government. The justices could issue a ruling on whether the Trump administration lawfully imposed a sweeping set of tariffs under emergency authorities. If the court rules against the president, the federal government could be forced to refund billions of dollars in tariff revenue collected over recent months, creating a significant fiscal and administrative challenge. At issue is whether the White House exceeded its statutory authority in invoking emergency powers to levy the tariffs without explicit congressional approval. A decision against the administration would not only unwind recent collections but could also constrain future presidents’ ability to impose trade penalties unilaterally. Pesticides: Bayer awaits decision in Roundup fight. Separately, the court is expected to decide whether it will take up Bayer’s appeal in long-running litigation alleging that Roundup, the widely used weedkiller, causes cancer. Bayer — through its Monsanto subsidiary — faces billions of dollars in potential liability from jury verdicts and settlements tied to claims that glyphosate exposure led to non-Hodgkin lymphoma. The company is asking the justices to clarify whether federal pesticide labeling law preempts state-level failure-to-warn claims. Lower courts have allowed many of those lawsuits to proceed, leaving Bayer with a fragmented legal landscape and substantial financial exposure. White House backs Bayer as MAHA pushes restrictions. In a notable alignment, the Trump administration has sided with Bayer, filing an amicus brief urging the Supreme Court to hear the case. The administration argues that allowing state courts to second-guess federally approved pesticide labels undermines national regulatory consistency. That position contrasts with pressure from the Make America Healthy Again (MAHA) movement, which has pushed the administration to phase out or restrict certain pesticides as part of a broader campaign against chronic disease and environmental exposure. While MAHA has influenced rhetoric and some policy discussions, its efforts to curb pesticide use have so far achieved limited regulatory success. Why today matters: Together, the two decisions underscore how much legal and financial risk is riding on Supreme Court action. A tariff ruling against the administration could reshape U.S. trade policy and force massive repayments, while a decision to take — or reject — Bayer’s appeal could determine the future trajectory of one of the largest mass-tort battles in U.S. history. — October export jump fails to close U.S. ag trade gap at start of FY 2026 Imports still outpaced shipments as tariffs cut inflows, keeping agriculture in deficit for a 22nd straight monthU.S. agricultural exports surged at the start of Fiscal Year 2026 but still fell short of imports, leaving the sector in a monthly trade deficit for October. Exports totaled $15.62 billion, up $2.16 billion (16%) from September, while imports rose to $16.04 billion, an increase of $250 million (1.6%) month over month. The imbalance produced an October deficit of $424 million to open the fiscal year.Compared with a year earlier, the picture improved but remained negative. In October 2024, exports were $16.53 billion against $18.51 billion in imports, yielding a $1.98 billion deficit. The October 2025 totals reflected a 3% decline in exports and a 13.4% drop in imports from the year-ago month, a pullback likely tied to the impact of tariffs on goods entering the United States. Even so, the October 2025 shortfall was the smallest monthly agricultural trade deficit since December 2023.The data underscore the persistence of the imbalance. Agriculture has now posted 22 consecutive months of trade deficits, with the last surplus recorded in November 2023 ($124 million). October 2022 was the last time the sector began a fiscal year in surplus, and since then there have been only five months with a positive trade balance.On China-bound soybeans, timing matters. Monthly trade figures are based on data from the U.S. Census Bureau, while weekly export activity is tracked by the U.S. Department of Agriculture. USDA’s weekly Export Sales reports did not show U.S. soybean shipments to China until the week ended Dec. 4, and data through Jan. 1 indicate exports have reached 1.19 million metric tons. As a result, Census trade data may not reflect soybean exports to China until December figures, which have yet to be released.— OMB calendar fills up as Treasury’s 45Z rule review acceleratesEight stakeholder meetings signal momentum on Clean Fuel Production Credit guidance 45Z action: After weeks of little visible movement, the review of Treasury’s proposed rule for the Clean Fuel Production Credit (45Z) appears to be gaining traction at the Office of Management and Budget (OMB). The U.S. Department of the Treasury formally sent its draft 45Z rule to the OMB on Dec. 17, with no public meetings posted in the immediate aftermath. That has now changed. OMB’s calendar shows eight meetings scheduled for next week with a cross-section of biofuel, feedstock, and fuel-market stakeholders. The lineup includes Amp Americas on Monday (Jan. 12); sessions Tuesday with Waste Management and Fuels America; Wednesday meetings with Continuum Ag and Growth Energy; and Thursday discussions with NATSO and SIGMA, followed by a separate session with Aemetis Inc. Of note: The Renewable Fuels Association (RFA) will meet with OMB Jan. 16 on the proposed rule, according to the Office of Information and Regulatory Affairs at OMB. The sudden concentration of meetings suggests OMB’s review is moving into a more active phase, raising expectations that the initial 45Z rule could be cleared on a relatively short timeline. Industry expectations remain that the package currently under review will apply to the 2025 tax year, with a separate, more comprehensive rulemaking covering 2026–2029 anticipated later in the first half of the year. —Brazilian egg exports hit record as U.S. demand surges, tariffs reshape tradeShipments more than doubled in 2025, with the U.S. emerging as top buyer before tariffs pushed exporters toward Asia and other markets Brazilian egg exports reached a record 40,894 metric tons in 2025, driven by strong overseas demand — especially from the United States — according to data from the Brazilian Association of Animal Protein. The total, which includes fresh and processed eggs, marked a 121.4% increase from 2024, while export revenues climbed 147.5% year over year to a record $97.2 million. The United States was Brazil’s largest egg buyer, importing 19,597 tons, an almost eightfold jump from 2024. However, shipments slowed after Washington imposed tariffs on a range of Brazilian products starting last August. ABPA president Ricardo Santin said the tariffs curtailed momentum late in the year and prompted exporters to redirect sales. As a result, Brazilian suppliers accelerated shipments to new destinations, particularly Japan, where demand strengthened in the final months of 2025. Other major importers included Chile, Mexico, and the United Arab Emirates. ABPA noted that exports surpassed the equivalent of 1% of Brazil’s domestic egg production for the first time, calling it a significant milestone for the sector even as trade policy shifts reshape market flows. —U.S./India trade talks stalled after Modi skipped call with Trump, Lutnick saysCommerce secretary says a missed leader-to-leader call derailed a near-complete pact, triggering tariff hikes and renewed pressure over India’s Russian oil purchases India’s long-running effort to secure a trade agreement with the United States unraveled last year after Prime Minister Narendra Modi declined to make a direct phone call to President Donald Trump to finalize negotiations, according to U.S. Commerce Secretary Howard Lutnick. Speaking on the All-In Podcast, Lutnick said the framework for a deal was effectively complete but stalled when New Delhi hesitated to initiate the call. “It’s all set up and you’ve got to have Modi call the President,” Lutnick said. “So Modi didn’t call.” The breakdown preceded Washington’s decision last August to double tariffs on Indian goods to 50% — the highest rate imposed on any country — including a 25% levy tied to India’s continued purchases of Russian oil. President Trump has since warned that tariffs could rise further unless India curbs those imports, rattling markets, pushing the rupee to record lows, and unsettling investors awaiting progress on a deal. Lutnick added that India is still seeking a tariff rate between terms previously offered to Britain and Vietnam, but said that window has expired. India’s trade ministry declined to comment. Reuters previously reported that Indian officials feared a direct call could become one-sided, potentially putting Modi at a disadvantage and contributing to the collapse of talks. —Trump signals major escalation: U.S. to begin land strikes against Mexican drug cartelsIn a Fox News interview, President Trump says after crippling maritime drug routes the U.S. will now “start hitting land” — a statement that implies potential military action against cartel infrastructure in Mexico, raising sovereignty and legal questions. Highlights: •U.S. military posture shift: President Donald Trump announced that the United States plans to begin land-based strikes targeting drug cartels, saying the campaign will follow extensive maritime operations that he claims intercepted 97% of drugs entering by sea. • Cartel focus: Trump framed the move as targeting the cartels “running Mexico” and criticized the situation south of the border, though he offered few details on timing, legal authority, or whether Mexican territory would be directly struck. • Regional tensions: The comment represents a stark escalation from previous U.S. counter-narcotics operations focused on international waters and comes just days after a high-profile U.S. military operation against Venezuelan leader Nicolás Maduro. • Diplomatic pushback: Mexican President Claudia Sheinbaum has strongly rejected any U.S. military intervention on Mexican soil, insisting on respect for sovereignty and non-intervention principles. • Broader implications: Experts and foreign policy observers caution that any land strikes in Mexico could dramatically heighten diplomatic tensions and raise significant legal and geopolitical issues. |
| NEW YORK TIMES INTERVIEW WITH TRUMP |
—Trump says his power is limited only by his ‘own morality’ in sweeping new interview
In a wide-ranging Oval Office interview with the New York Times, President Trump dismissed international law as a binding constraint, embraced coercive use of U.S. power abroad, and suggested courts and Congress have only conditional authority to limit him at home
| At a glance: New York Times Interview Summary Source: Interview with President Donald Trump conducted by The New York Times White House correspondents, Jan. 8, 2026 Topic: Trump’s position (in his words or substance) •Limits on presidential power: Only his “own morality” and judgment ultimately restrain his actions• International law & treaties: Applies only as he defines it; not an external constraint on U.S. power• Use of force abroad: Willing to strike, coerce, or intervene quickly to deter adversaries•Coercive diplomacy: Embraces unpredictability to pressure other nations• Greenland: U.S. ownership is “psychologically needed for success,” beyond treaties•NATO & allies: Alliance is ineffective without U.S.; Europe must “shape up”•China & Russia precedents: Claims U.S. actions don’t justify moves against Taiwan or Ukraine•Congress & courts: Can limit him only “under certain circumstances”• Domestic force: Will invoke Insurrection Act or federalize Guard if he deems it necessary |
In a blunt and unusually expansive interview, Donald Trump told the New York Times that the only real limit on his authority as commander in chief is his “own morality,” openly sidelining international law, treaties, and global norms as binding constraints on U.S. power.
Pressed on whether international law restricts American military or economic actions, Trump said it applies only as he interprets it. National strength, not multilateral rules, he argued, should determine outcomes when great powers collide. The remarks amount to his clearest articulation yet of a worldview in which U.S. supremacy outweighs legal or institutional limits.
Trump portrayed unpredictability and a readiness to use force as deliberate tools of statecraft. During the interview, he took a call from Gustavo Petro, underscoring what the Times described as coercive diplomacy following U.S. threats toward Colombia after recent actions in Venezuela. He cited the strike on Iran’s nuclear program, the removal of Venezuela’s government, and renewed pressure on allies as evidence that his approach works.
On alliances, Trump suggested NATO’s value depends almost entirely on the United States and acknowledged that securing Greenland could ultimately conflict with preserving the alliance itself. He argued that ownership — not leases or treaties — delivers strategic and psychological advantages, reflecting a transactional view of sovereignty and borders.
While dismissive of global norms, Trump rejected the idea that his actions set precedents for rivals. He argued that Xi Jinping or Vladimir Putin could not credibly use U.S. interventions to justify moves on Taiwan or Ukraine, insisting those situations were fundamentally different. He also claimed China would not move on Taiwan while he remains president.
Domestically, Trump acknowledged that courts and Congress can constrain him — but only in limited cases. He floated workarounds if judges strike down tariffs and reiterated his willingness to invoke the Insurrection Act or deploy the military inside the United States if he believes circumstances warrant it.
The interview, conducted by senior Times correspondents in the Oval Office, presents a portrait of a president who sees himself as the ultimate judge of legality, necessity, and restraint — at home and abroad — with institutional checks treated as conditional rather than binding.
| FINANCIAL MARKETS |
—Equities today: Global markets were cautiously higher ahead of crucial jobs reports in the U.S. and Canada, while investors eyed a U.S. Supreme Court ruling on the legality of President Donald Trump’s sweeping global tariffs that jolted markets last year.
—Equities yesterday:
| Equity Index | Closing Price Jan. 8 | Point Difference from Jan. 7 | % Difference from Jan. 7 |
| Dow | 49,266.11 | +270.03 | +0.55% |
| Nasdaq | 23,480.02 | -104.26 | -0.44% |
| S&P 500 | 6,921.46 | +0.53 | +0.01% |
—Trump orders $200 billion mortgage bond buy to push down home loan rates
Fannie Mae and Freddie Mac to execute purchase as White House rolls out aggressive housing affordability agenda
President Donald Trump announced Thursday that the U.S. will purchase $200 billion in mortgage bonds, a move he says is aimed at driving down mortgage rates and monthly payments to make homeownership more affordable.
In a post on Truth Social, Trump said the decision leverages the financial strength of Fannie Mae and Freddie Mac, arguing the bond purchases will help ease borrowing costs across the housing market. Federal Housing Finance Agency Director Bill Pulte confirmed on X that the two government-sponsored enterprises will carry out the transaction.
The announcement follows Trump’s earlier pledge to curb housing costs by banning large institutional investors from buying additional single-family homes, a policy he says is intended to keep housing for families rather than corporations. He has urged Congress to codify such a ban, acknowledging it could face legal challenges.
Trump also previewed broader housing reforms — including 50-year mortgages, opening federal land for development, portable mortgages, potential capital gains tax relief on home sales, and even a national housing emergency declaration—saying more details will come in an address at the World Economic Forum in Davos later this month.
Despite easing mortgage rates — recently around 6.3% — affordability remains strained, with households needing roughly $108,000 in annual income to buy a median-priced home. The administration argues the bond-buying plan is a central plank in a broader push to “make America affordable again.”
—Atlanta fed nearly doubles Q4 growth estimate to 5.4% on trade and services surge
GDPNow upgrade and stronger late-year data point to hotter U.S. growth momentum, even as inflation risks linger
U.S. growth expectations jumped sharply after the Federal Reserve Bank of Atlanta nearly doubled its fourth-quarter GDP estimate, underscoring stronger-than-expected momentum late in the year.
The Atlanta Fed’s GDPNow model lifted its Q4 real GDP growth estimate to 5.4% on Jan. 8, up from 2.9% just a day earlier, following new data on trade, consumer spending, and services activity. The revision reflects a dramatic swing in net exports, driven by a sharply narrower trade deficit.
According to data released by the U.S. Bureau of Economic Analysis, the U.S. trade gap shrank to $29.4 billion in October — the smallest monthly deficit since 2009 — as imports fell and exports hit a record high. In the GDPNow model, net exports flipped from a 0.3-percentage-point drag to nearly a 2-percentage-point boost, accounting for most of the headline upgrade.
Consumer spending also firmed modestly, with real personal consumption growth rising to about 2.1% from 1.8%, while inventories, investment, and government spending were little changed.
Late-year business surveys reinforced the picture of improving momentum. A Jan. 7 report from the Institute for Supply Management showed the services PMI climbing to 54.4, the highest reading of 2025, as new orders, business activity, and employment rebounded. Eleven of 16 industries reported growth, though price pressures remained elevated, with the prices index above 60 for a 13th straight month.
Separately, Fitch Ratings raised its medium-term outlook after incorporating delayed government data. Fitch now estimates U.S. GDP growth of 2.1% in 2025 (up from 1.8%) and 2.0% in 2026 (up from 1.9%), citing stronger consumption, government spending, and net trade in the second half of 2025. It also flagged robust IT investment, up 14% year over year.
Looking ahead, Fitch expects inflation pressures to reemerge as delayed tariff pass-through feeds into prices, forecasting consumer inflation of 3.2% by end-2026, with unemployment averaging 4.6%. The agency anticipates two Fed rate cuts in the first half of 2026, taking the upper bound of the policy rate to 3.25%.
Meanwhile, the Congressional Budget Office projects steadier but moderating growth, with real GDP rising 2.2% in 2026 before easing to an average of 1.8% in 2027–2028 amid higher tariffs, slower labor-force growth, and cooling inflation.
—Gold and silver face selling pressure as index rebalance triggers bullion outflows
Precious metals see heightened scrutiny while cocoa emerges as a rare beneficiary of index-driven buying
Gold and silver are coming under renewed pressure as upcoming commodity index rebalances prompt a wave of bullion sales by funds tracking benchmark indices. The adjustments are expected to reduce exposure to precious metals, increasing short-term selling flows and adding volatility to already cautious markets.
In contrast, cocoa is poised to benefit from the same rebalance period, with large-scale buying anticipated as index weightings shift in its favor. The divergence highlights how mechanical index changes — rather than fundamentals alone — can drive sharp, opposing moves across commodity markets in the near term.
| AG MARKETS |
—More U.S. sorghum, soybean sales to China in latest USDA data. USDA Export Sales data for the week ended Jan. 1 included activity for 2025/26 of net sales of 222,294 MT of sorghum, 470,073 MT of soybeans, and 12,449 running bales of upland cotton. For 2025, the data put U.S. beef exports to China for 2025 of 35,166 MT with 196 MT of sales carried into 2026. For pork, 2025 exports were reported at 137,188 MT with 8,600 MT carried into 2026. Net sales for 2026 totaled 1,263 MT bringing total commitments to 21,175 MT. The weekly total of soybean export sales to China pushed export commitments as of Jan. 1 to 6,892,519 MT, with daily sales since that period (as of Thursday, Jan. 8) bringing total export commitments to 7,360,519 MT.
—Agriculture markets yesterday:
| Commodity | Contract Month | Close Jan. 8 | Change vs Jan. 7 |
| Corn | March | $4.46 | -$0.0075 |
| Soybeans | March | $10.6125 | -$0.0575 |
| Soybean Meal | March | $303.60 | -$1.80 |
| Soybean Oil | March | 49.45¢ | +0.14¢ |
| Wheat (SRW) | March | $5.18 | $0.00 |
| Wheat (HRW) | March | $5.3025 | -$0.0125 |
| Spring Wheat | March | $5.7125 | +$0.0075 |
| Cotton | March | 64.46¢ | -0.39¢ |
| Live Cattle | February | $235.275 | +$0.75 |
| Feeder Cattle | March | $357.725 | +$2.225 |
| Lean Hogs | February | $85.875 | +$1.075 |
| FARM POLICY |
—FSA eases loan rules, allows use of ad hoc payments as farm finances tighten
USDA guidance lets county offices factor in projected farm program and disaster aid — and extend operating loan terms — amid mounting 2026 profitability pressures
The Farm Service Agency is instructing county offices to more flexibly use farm program and ad hoc payments when evaluating borrower cash flow, acknowledging that “high input costs combined with low commodity prices” are creating widespread profitability challenges heading into 2026.
Under the guidance, county offices may include Farm Program (FP) payments in loan cash-flow projections if they can be reasonably projected and are currently authorized and funded. Staff are directed to distinguish between recurring payments and one-time, ad hoc assistance when setting up farm operating plans. Disaster and other ad hoc payments may be counted only in the year they are received and cannot be treated as part of a “typical” year.
FSA is also involving County Executive Directors more directly in loan reviews, given their role in determining what program assistance a producer has received or can expect during the loan term.
The agency highlighted the Farmer Bridge Assistance (FBA) Program as an exception among ad hoc aid. Because FBA payments use a “simple, proportional” formula to cover a portion of modeled 2025 crop-year losses, FSA said those payments can be easily projected and included in current-year cash-flow plans. Guaranteed lenders are likewise encouraged to use FBA projections.
Guidance for specialty crops is expected later this year.
By contrast, Price Loss Coverage (PLC) and Agriculture Risk Coverage (ARC) payments are not considered ad hoc assistance and may continue to be included in cash-flow projections as standard farm program income, with loan and farm program staff coordinating on payment estimates.
Separately, FSA reminded county offices that direct annual operating loans — typically written for 12 months — may extend up to 24 months when production or marketing plans require more time to demonstrate profitability. The agency explicitly cited current economic stress as a reason to allow longer terms for 2026 marketing plans and noted that loan terms beyond 24 months are permissible when a producer is recovering from an economic reversal.
Taken together, the guidance represents one of USDA’s clearest acknowledgements to date of the financial strain facing many U.S. farmers — and signals a more accommodative posture from FSA as producers work through tight margins and delayed profitability.
—Senate Democrats press USDA to speed disaster aid as payment delays threaten 2026 farm decisions
Klobuchar, Slotkin warn that slow rollout of Biden-era disaster funds could leave specialty crop producers without critical financial clarity until summer
Sens. Amy Klobuchar (D-Minn.) and Elissa Slotkin (D-Mich.), joined by 10 other Senate Democrats, are urging the Trump administration to accelerate disaster aid payments to farmers, citing mounting delays at USDA
In a letter (link) sent this morning to USDA Secretary Brooke Rollins, the senators argue that USDA’s slow distribution of billions in disaster assistance could prevent specialty crop producers from receiving crucial financial information until late spring or summer. USDA recently extended the application deadline for “Stage Two” disaster aid — designed primarily for specialty crops — through the end of April, a move that pushes payments back and could complicate farmers’ planning for the rest of 2026. The letter was first reported by Politico.
The lawmakers note that less than $6 billion of the $16 billion appropriated by Congress has been paid out, more than a year after funding was approved and nearly three years after some losses occurred. They warn that continued delays risk leaving struggling producers without timely support.
USDA, meanwhile, is preparing to roll out payments from a separate farmer bridge aid program announced in December. Rollins has pledged those payments will reach farmers by the end of February, a timeline Democrats say will be critical to restoring confidence amid ongoing financial strain.
—House Ag GOP readies updated skinny farm bill for February markup
Ag Chair Thompson says draft text is largely complete, but timing hinges on CBO scores and leadership buy-in
House Ag Committee Republicans are preparing to release updated Farm Bill text as they aim for a committee markup in February, according to Politico. Committee Chairman GT Thompson (R-Pa.) said the drafting work is essentially finished and largely mirrors the version that advanced out of committee in 2024.
Thompson told reporters he recently spoke briefly with Speaker Mike Johnson (R-La.) on the House floor and has been signaling to members that he’s seeking leadership support and floor time to move the bill this spring, two people familiar with the plans told Politico.
A formal introduction is not imminent, however. Timing remains fluid, and Thompson said he is still awaiting final cost estimates from the Congressional Budget Office, which could affect the rollout and markup schedule.
| ENERGY MARKETS & POLICY |
—Friday: Oil prices climb on supply uncertainty amid Venezuela, Iran tensions
Geopolitical risk drives crude higher while oversupply looms
Oil prices rose for a second consecutive day on Friday and are on track for a third weekly gain as traders weigh geopolitical risks that could tighten supply, particularly in Venezuela and Iran.
Brent crude futures were up around 1.3% near the low-$60s per barrel, while U.S. West Texas Intermediate (WTI) also climbed about 1.3%, building on a more than 3% increase on Thursday.
Uncertainty over Venezuela’s future oil exports — including U.S. actions to exert control over the country’s oil sector after the capture of President Nicolás Maduro — has injected a risk premium into markets, even though the nation currently accounts for a small share of global output. Meanwhile, escalating civil unrest in Iran, accompanied by reports of nationwide disruptions, has boosted concerns about production stability from another key producer.
Analysts note that while these geopolitical factors are buoying prices, rising global inventories and an underlying supply overhang in 2026 could cap gains unless physical supply disruptions materialize.
Key drivers in oil market sentiment:
• Venezuela supply risks: U.S. moves to control or market Venezuelan crude have unsettled traders and spurred competition among oil firms for export deals.
• Iran unrest: Widespread protests and infrastructure strains raise fears of output disruption in a historically significant exporter.
• Broader geopolitical backdrop: Fears of broader conflict impacts, such as possible effects on Russian exports tied to the Russia-Ukraine war, add to the risk narrative.
In summary, geopolitical tensions are temporarily lifting prices, but broader market fundamentals — particularly oversupply — may limit how far and how long crude can rally without a tangible drop in physical supply.
—Thursday: Oil prices rebound on geopolitical supply risks
Markets digest Venezuela developments and global supply concerns
Oil prices climbed more than 3% on Thursday, snapping a two-day slide as investors assessed heightened geopolitical risks tied to Venezuela and supply threats from Russia, Iraq, and Iran.
Brent crude futures rose $2.03, 3.4%, to settle at $61.99 a barrel, marking their highest close since late December, while U.S. West Texas Intermediate (WTI) gained $1.77, 3.2%, to $57.76.
The rally followed continued U.S. actions in Venezuela, including the capture of President Nicolás Maduro and the seizure of two Venezuela-linked oil tankers as part of Washington’s effort to manage and eventually market Venezuelan crude. U.S. and European oil companies are coordinating operations and discussing terms with commodity traders, though analysts say meaningful crude arrivals to the U.S. Gulf Coast remain years away, limiting near-term impact.
Outside Venezuela, supply concerns also surfaced: a Russia-bound tanker was struck by drones in the Black Sea, Iraq is planning to nationalize operations at the West Qurna 2 oilfield amid U.S. sanctions on Lukoil, and unrest in Iran — including protests and a nationwide internet blackout — continues to threaten exports that represent roughly 2% of global oil supply.
Despite these headline-driven price moves, many analysts caution that ample global supply through 2026 could cap sustained upside, and that short-term volatility is largely tethered to geopolitical developments rather than fundamentals.
—Diesel prices extend slide for seventh straight week
U.S. average falls to $3.48 a gallon as global oil surplus and OPEC+ supply pause weigh on fuel markets
U.S. diesel prices declined for a seventh consecutive week, underscoring continued softness in energy markets tied to ample global supply. According to the Energy Information Administration, the national average diesel price for the week ending Jan. 5 fell 2.3 cents to $3.477 per gallon. That puts prices 8.4 cents below the same week last year.
Since mid-November, the slide has been pronounced. The EIA data show the U.S. average diesel price has dropped 39.1 cents per gallon since the week ending Nov. 17.
The downturn followed a decision by OPEC+ to pause planned oil supply increases in the first quarter of 2026, citing a growing surplus in global oil markets — a move that reinforced expectations of abundant supply and weighed on refined fuel prices.
Diesel prices fell across all five EIA regions during the latest week. Over the full seven-week decline, the Rocky Mountain region saw the steepest drop (down 59.1 cents per gallon), followed by the Midwest (down 52.6 cents per gallon), highlighting particularly sharp relief for agricultural and freight-heavy regions.
—Senate Ag GOP eyes spending bills as vehicle for year-round E15
Grassley, Fischer say attaching E15 to must-pass funding could finally break stalemate as ag, ethanol and refiners align
Senate Ag Committee Republicans are pressing to use this month’s must-pass spending bills to finally authorize year-round sales of E15 gasoline, arguing that attaching the provision to funding legislation is the only realistic path to enactment.
Sen. Chuck Grassley (R-Iowa) said E15 should move without a standalone floor fight, emphasizing the need to bypass the Senate’s 60-vote hurdle. “We need to get it done,” added Sen. Deb Fischer (R-Neb.), underscoring growing impatience after years of failed attempts.
Efforts to secure permanent E15 have repeatedly stalled when provisions were stripped from final funding bills or other legislative vehicles. Advocates now see a more favorable opening as Republicans look for ways to support U.S. producers facing pressure from Donald Trump’s tariff agenda, persistent inflation and elevated input costs.
Agriculture and biofuels groups say they are coordinating closely with leadership and the administration to avoid last-minute setbacks.
A key shift bolstering momentum: renewed backing from the American Petroleum Institute. API had previously objected to E15 plans that did not also address the Small Refinery Exemption under the Renewable Fuel Standard. That issue is now expected to be folded into the framework lawmakers are advancing, according to people familiar with the negotiations.
Supporters say the alignment is unprecedented. With ethanol producers, farm groups, refiners and fuel retailers now pushing in the same direction, backers are betting that the long-running E15 stalemate may finally be nearing a breakthrough.
—DOE scraps disputed EV fuel-economy formula after court rebuff
Agency restores pre-2024 rules following Eighth Circuit decision
The Department of Energy has formally withdrawn a March 2024 final rule that revised how electric vehicles’ petroleum-equivalent fuel economy is calculated, resetting the regulations to their pre-2024 form. In a notice published in the Federal Register (link), DOE said it is removing the rule that updated procedures for calculating petroleum-equivalent fuel economy for EVs and revised the petroleum-equivalency factor (PEF). The withdrawn rule would have established a new standard for setting PEF values beginning with the 2027 model year.
The March 2024 rule was challenged by a coalition of states — Iowa, Arkansas, Florida, Idaho, Kansas, Mississippi, Missouri, Montana, Nebraska, Ohio, Oklahoma, Texas, and Utah — along with the American Free Enterprise Chamber of Commerce. The challengers sought review in the U.S. Court of Appeals for the Eighth Circuit, which remanded the matter to DOE and vacated the 2024 final rule.
DOE’s newly published action implements that decision by restoring the regulatory text to what was in place before the March 2024 changes took effect.
| TRADE POLICY |
—EU poised to clear landmark Mercosur trade deal despite farm backlash
Member states set to approve bloc’s largest-ever free trade pact as Brussels seeks new markets amid U.S. tariffs and China risk
European Union nations are expected today to approve the signing of the bloc’s biggest free trade agreement to date with the South American bloc Mercosur, ending more than 25 years of negotiations and months of intense political wrangling inside the European Union.
Supporters, led by Germany and Spain, argue the pact is central to Brussels’ strategy to offset business losses from U.S. tariffs, reduce dependence on China, and secure access to critical raw materials. The European Commission, which concluded negotiations a year ago, has pushed hard to line up sufficient backing.
Opposition remains fierce, particularly from France, the EU’s largest agricultural producer. Paris warns the deal would increase imports of lower-cost beef, poultry, and sugar, undercutting European farmers. Protests have intensified this week, with farmers blocking roads across France.
EU ambassadors from the bloc’s 27 member states are due to signal their governments’ positions today. Approval requires support from at least 15 countries representing 65% of the EU’s population. Formal written confirmation would follow later Friday or early next week, clearing the way for Commission President Ursula von der Leyen to sign the agreement with Mercosur partners Argentina, Brazil, Paraguay, and Uruguay. The European Parliament must still ratify the pact before it can enter into force.
The agreement would be the EU’s largest ever in terms of tariff reductions, eliminating roughly €4 billion in duties on EU exports. Mercosur countries currently impose steep tariffs, including about 35% on car parts, 28% on dairy products, and 27% on wines. Two-way goods trade totaled roughly €111 billion in 2024, with EU exports dominated by machinery, chemicals, and transport equipment, while Mercosur exports focus on agriculture, minerals, and pulp and paper.
To win over skeptics, the Commission has added safeguards allowing the suspension of imports of sensitive farm products, tightened controls on pesticide residues, created a crisis fund, accelerated farmer support, and pledged to cut fertilizer import duties. Those measures failed to sway France and Poland, though Italy appears to have shifted from opposition in December to backing the deal.
French Agriculture Minister Annie Genevard insists the fight is not over, vowing to push for rejection in the European Parliament, where the vote could be close. Environmental groups also oppose the pact, with Friends of the Earth labeling it “climate-wrecking.” Still, German Social Democrat Bernd Lange, who chairs parliament’s trade committee, said he expects approval, with a final parliamentary vote likely in April or May.
| CONGRESS |
—House clears full-year funding package, Senate and deadline press ahead
Minibus advances with broad support, but floor time fights and six remaining bills loom before Jan. 30
The House moved Congress closer to long-term government funding on Thursday, approving a three-bill “minibus” that would finance several agencies through the end of the fiscal year, even as lawmakers warned that significant hurdles remain before the Jan. 30 shutdown deadline.
The package — covering Commerce-Justice-Science, Energy and Water, and Interior-Environment — passed 397-28 and now heads to the Senate, which is expected to take it up early next week. The vote marked a notable victory for appropriators after a turbulent start to the second Trump administration that included a record-long shutdown last year.
Still, the Senate’s crowded agenda could slow progress. Senate Majority Leader John Thune (R-S.D.) cautioned that floor time devoted to a resolution curbing U.S. military engagement in Venezuela will come at the expense of appropriations work. Congress must also clear six additional funding bills to avoid a partial shutdown after Jan. 30.
What’s next: Appropriators are preparing additional minibuses, with plans to bundle Financial Services, Homeland Security, and State-Foreign Operations next, followed by the largest accounts — Defense, Labor-HHS-Education, and Transportation-HUD. House Appropriations Chairman Tom Cole (R-Okla.) said leadership structured the packages to maximize bipartisan support, but acknowledged timing challenges.
Conservative opposition briefly stalled the current minibus over earmark concerns. GOP leaders promised greater input going forward, easing the procedural logjam. House Freedom Caucus Chairman Andy Harris (R-Md.) said members would have more access and influence on future bills.
What’s in the minibus:
• Commerce-Justice-Science: Roughly $6.1 billion for National Oceanic and Atmospheric Administration, $1.8 billion for National Institute of Standards and Technology, and about $1.5 billion for the Census Bureau. The Justice Department would receive $37 billion, restoring certain grants and funding a “peacemakers” office previously dismantled.
• Energy and Water: Avoids proposed administration cuts, providing $3.1 billion for energy efficiency and renewable programs and $8.4 billion for the Office of Science.
• Interior-Environment: Funds the Environmental Protection Agency at $8.8 billion—about 4% below current levels but above the administration request—and allocates $14.5 billion to Interior, including $3.3 billion for the National Park Service.
The Equal Employment Opportunity Commission would see a nearly $20 million cut and face new congressional notification requirements for reorganizations.
With Senate action pending and multiple bills still unwritten, appropriators face a tight runway. The House vote signals momentum — but not yet a clear path — to keeping the government funded past the end of the month.
| FOOD POLICY & FOOD INDUSTRY |
—Global food prices slide for fourth month as dairy, meat weigh on index
FAO index hits lowest level since January 2025 despite higher annual average driven by oils and dairy
World food prices fell for a fourth straight month in December, pressured primarily by declines in dairy, meat and vegetable oil prices, according to the United Nations’ Food and Agriculture Organization of the United Nations. The FAO Food Price Index averaged 124.3 points in December, down from 125.1 in November and 2.3% lower than a year earlier, marking its lowest monthly level since January 2025.
Despite the late-year easing, the index averaged 127.2 points for full-year 2025, up 4.3% from 2024, as higher prices for vegetable oils and dairy more than offset declines in cereals and sugar.
Dairy prices fell 4.4% in December, led by a sharp drop in butter prices following increased cream availability in Europe. Still, dairy prices averaged 13.2% higher for 2025, reflecting strong import demand and constrained export supplies earlier in the year.
Meat prices slipped 1.3% in December — driven by bovine and poultry — yet remained 5.1% higher year over year, supported by firm global demand and ongoing animal disease and geopolitical risks.
Vegetable oil prices edged down 0.2% in December to a six-month low as weaker soy, rapeseed and sunflower oil prices offset gains in palm oil. For 2025 overall, however, the vegetable oil index averaged 17.1% higher than 2024, reaching a three-year high amid tight global supplies.
In contrast, the FAO cereal price index rose 1.7% in December, with wheat supported by renewed concerns over Black Sea export flows and maize buoyed by strong ethanol production in Brazil and the United States. Even so, cereals averaged 4.9% lower for 2025, marking a third consecutive annual decline and the lowest annual average since 2020.
Sugar prices increased 2.4% in December after three months of declines due to lower output in southern Brazil, but the sugar index still posted a 17% drop for 2025, hitting a five-year low as global supplies remained ample.
—Trump administration launches national roadshow to promote new dietary guidelines
Officials tout protein-heavy, whole-foods diet, criticize ultraprocessed foods, and signal tougher SNAP stocking rules as rollout begins in Pennsylvania
The Trump administration formally kicked off its push for the 2025–2026 Dietary Guidelines for Americans with a celebratory event at the Department of Health and Human Services, unveiling a nationwide “Dietary Guidelines for America Roadshow” aimed at reshaping how Americans eat.
The roadshow will begin next week in Pennsylvania, with USDA Secretary Brooke Rollins headlining the first stop, according to Kyle Diamantis, the Food and Drug Administration’s deputy commissioner for human foods. Rollins is expected to attend the Pennsylvania Farm Show as part of the rollout.
Administration officials used the event to reinforce a central message of the new guidelines: eat more protein — including red meat and dairy — emphasize fruits and vegetables, avoid added sugars, and steer clear of ultraprocessed foods.
Food and Drug Administration Commissioner Marty Makary said junk food has become the core of the American diet and argued the administration is “reclaiming” the food pyramid. He contrasted the former pyramid with the Obama-era “My Plate” graphic, saying the new, inverted pyramid encourages protein consumption, including foods with saturated fat.
Health and Human Services Secretary Robert F. Kennedy Jr., who co-authored the guidelines with Rollins, delivered the most pointed remarks. “Eat real food,” Kennedy said, adding that packaged foods should generally be avoided. He also sharply criticized the American Heart Association, accusing it of campaigning against saturated fat while taking money from companies producing ultraprocessed foods.
The Heart Association pushed back in a detailed statement, saying it welcomed the new guidelines — particularly their focus on fruits, vegetables, whole grains, and limiting added sugars — and rejected any suggestion of improper corporate influence, noting that nearly 85% of its revenue comes from non-corporate sources and that it maintains strict scientific peer-review protections.
Kennedy said the guidelines have been well received since their release, pointing to praise from the American Medical Association. The AMA applauded the administration for spotlighting ultraprocessed foods, sugary beverages, and excess sodium, though it did not directly address the guidelines’ encouragement of higher protein and saturated fat intake.
Rollins praised Kennedy as a “difference maker,” calling for a standing ovation and emphasizing the administration’s commitment to putting farmers and ranchers “back in the middle” of efforts to improve Americans’ health. Beef, dairy, and hog farmers were highlighted at the event, while grain farmers — whose crops are often used in ultraprocessed foods — were notably absent.
On food access, Rollins said the administration plans to “double” healthy-food stocking requirements for the roughly 250,000 retailers authorized to accept SNAP benefits. She argued the foods recommended under the guidelines can be purchased for about $3 per meal and said retailers must offer them if they accept taxpayer dollars.
Closing the event, Diamantis framed the rollout as the start of a sustained campaign. “Today is not the end of the mission,” he said. “This begins a year-long push.”
| WEATHER |
— NWS outlook: Heavy rainfall and severe weather possible over portions of the Lower Mississippi Valley and Southeast today… …Heavy snow expected over the Central/Southern High Plains today…
