Mexico & U.S. Enter Key Talks on Mexico’s Push to Reopen Livestock Border
Lula claims Trump promised a trade agreement with the U.S. | Will U.S. soybean rally impact coming trade aid payment?
Link: AM Updates, Oct. 27: Many Markets Sharply Higher Amid Signs
Washington Moving Toward Broad De-escalation of Trade Tensions
Link: Video: Wiesemeyer’s Perspectives, Oct. 24
Link: Audio: Wiesemeyer’s Perspectives, Oct. 24
PM Updates:
LATIN AMERICA AND TRADE
— Mexico and U.S. enter key talks on Mexico push to reopen livestock border
— Lula claims Trump promised a trade agreement with the U.S.
AGRICULTURE AND COMMODITIES
— Question: If U.S. soybean prices continue to rally, will that impact trade-aid program?
— Analyst: Three facts showing China is not to blame for soybean farmer losses
U.S./CHINA RELATIONS
— Wang Yi urges U.S. & China ‘meet each other halfway’ ahead of Trump/Xi summit
U.S./MEXICO RELATIONS
— Sheinbaum announces extension of U.S./Mexico trade deadline
AGRICULTURAL EXPORTS AND MARKETS
— NPPC: Trump opens Malaysian market to U.S. pork exports
DOMESTIC POLICY AND GOVERNMENT
— Largest gov’t union calls for clean CR to end shutdown
— GOP crafts health care plan as ACA/ObamaCare subsidy showdown looms
PM Updates: Policy/News/Markets, Oct. 27, 2025
—Mexico and U.S. enter key talks on possibly reopening livestock borderMexico aims to lift U.S. ban on Mexican cattle exports after screwworm outbreak This week: Mexico’s Secretary of Agriculture and Rural Development, Julio Berdegué Sacristán, is traveling to Washington, D.C. this week to negotiate the reopening of the U.S./Mexico border for cattle exports, which has been closed since July following outbreaks of the cattle screwworm. The trip, confirmed by President Claudia Sheinbaum, seeks to normalize livestock trade between the two countries. “We hope he can return with an agreement on the opening of the border,” Sheinbaum said at a press conference. Berdegué is set to meet USDA Secretary Brooke Rollins to review containment progress and the technical criteria for restoring exports. The United States imposed the border closure after new screwworm detections in Veracruz and Nuevo León, halting a vital export market for northern Mexican ranchers. Despite months of joint control measures under the Binational Screwworm Eradication Plan, tensions grew mid-year after further cases emerged in Nuevo León, with U.S. officials accusing Mexico of noncompliance — an allegation Mexican authorities denied. Mexico losses. Producers in Chihuahua, Sonora, Coahuila, and Tamaulipas — the heart of Mexico’s export cattle belt — say losses have reached millions due to the shutdown. “Mexico has demonstrated that it has the technical capacity and resources to handle the problem,” said a representative of the National Cattle Confederation (CNG), urging a swift resolution. If successful, an agreement to reopen the border is a murky situation regarding the timeline and other specifics. If there is a reopening, most observers think it would be another gradual reopening as USDA tried in late June/early July. There have been more cases since then so it would be hard to argue for a complete opening. —Lula claims Trump promised a trade agreement with the U.S.Brazilian leader says meeting with President Trump yielded “good signs” for normalizing trade despite 50% tariffs on Brazilian exports. Brazilian President Luiz Inácio Lula da Silva said this week that President Donald Trump personally assured him of a forthcoming trade agreement between the two nations, following their bilateral meeting during the ASEAN summit in Malaysia. “The talks were frank and positive. I believe we will reach an understanding faster than many imagine,” Lula said after the meeting, describing the dialogue as cooperative despite the 50% U.S. tariff imposed on Brazilian exports in retaliation for legal proceedings against former President Jair Bolsonaro. Trump, however, struck a more cautious tone, calling Lula “an energetic guy, with a lot of drive,” but adding, “I don’t know if anything will happen, but we’ll see,” before departing for South Korea. A dialogue amid tensions. The talks came at a sensitive time for trade relations. The new U.S. tariffs have hit key Brazilian sectors such as steel, ethanol, aluminum, and agricultural products, prompting sharp criticism from Brazilian businesses and officials. Lula labeled the tariffs “incorrect and unjustified” but reaffirmed his commitment to “maintain an open and mature dialogue,” even on contentious regional issues like Venezuela. Economic bridges and diplomatic balances. Brazil’s Foreign Ministry, Itamaraty, described the Malaysia meeting as a chance to “restructure the bilateral agenda” on trade, environment, and energy issues. Diplomats said the discussions could pave the way for tariff reductions or new export quotas, though concrete outcomes are not expected immediately. Lula’s strategy seeks balance — strengthening ties with Washington without jeopardizing Brazil’s strategic relationship with China, its top trading partner. Meanwhile, Brazil’s private sector remains on alert. The National Confederation of Industry (CNI) estimates that U.S. tariffs have cut exports to that market by 18% since August, and business leaders are urging both governments to provide “a clear roadmap for restoring competitiveness.” Lula concluded that Brazil will continue pursuing “active economic diplomacy” across the U.S., Asia, and Europe. “Brazil must talk to everyone, without subordination,” he said. Of note: On Brazil, their tariffs on U.S. ethanol will likely be on the agenda, and note that Brazil has still been shipping in beef to the U.S despite the higher tariff. —Question: If U.S. soybean prices continue to rally, will that impact the pending trade-aid program? Answer: Yes. It’s why USDA Secretary Brooke Rollins has repeatedly said she’s evaluating but hasn’t pulled the trigger. We are just now starting the marketing year for the 2025 bean crop. —Analyst: Three facts showing China is not to blame for soybean farmer lossesAnd one fact that points weakly in the other direction It’s been a difficult year in the Corn/Soybean Belt, where “farmers are facing crop prices too low to cover their costs,” writes Aaron Smith, an agricultural economist and writer who publishes research and commentary on commodity markets, particularly focusing on U.S. farm policy, price trends, and trade impacts. While President Trump’s administration is preparing payments to cushion the blow, the government shutdown has delayed those checks, adding strain to an already tight season. Many have pinned the blame on China’s decision to halt U.S. soybean purchases. But as Smith argues, “can we really blame China for the tough times soybean farmers are going through?” His analysis suggests the answer is mostly no. Smith’s Fact 1: Prices Have Been Declining for YearsAccording to Smith, U.S. soybean prices “have been declining for three years.” Production in the U.S. has stayed flat, while Brazil’s has surged 83% in a decade — now accounting for 40% of global supply. “Low and declining prices started way before last month when China stopped buying U.S. soybeans,” he notes, pointing to oversupply as the main culprit. Smith’s Fact 2: Record U.S. Yields Added PressureU.S. soybean yields are at a record 53.5 bushels per acre. “When yields increase, prices have to drop to convince people to buy the extra product,” Smith explains. Since global demand for soybeans is relatively inelastic, large crops often drive profits down even as volumes rise. Smith’s Fact 3: Other Buyers ExistChina may be the biggest buyer, but “countries other than China import 40% of the world’s soybeans,” Smith writes. The U.S. itself exports roughly 25% of the global total, meaning “if China won’t buy U.S. soybeans, then the U.S. can sell to other countries.” Smith’s Opposing Fact: Brazil’s Prices Now HigherSmith concedes one counterpoint: soybean prices at Brazil’s Paranaguá port have risen above U.S. Gulf levels—an inversion from the usual 8% premium in America’s favor. This suggests that “lack of demand from China suppressed U.S. prices by about 13% through September.” Still, he expects “the price gap should return to normal once markets figure out where else to send U.S. soybeans.” Smith’s Bonus Mixed Fact: Modest Reaction to Tariff NewsHistorically, soybean markets have largely “yawned at the tariff war.” But this week, prices are up 2.5% amid reports of a new U.S./China trade understanding. “They are now back to where they were in June and February,” Smith observes. Overall, Smith concludes that “lack of demand from China is not to blame for the struggles of soybean farmers.” Instead, he cautions that the real threat lies in Brazil’s ever-expanding supply. “If I were in the soybean business,” he writes, “I would be much more worried about Brazil’s massively increasing supply than China’s demand.”—Wang Yi urges U.S. and China to ‘meet each other halfway’ ahead of Trump/Xi summitBeijing’s top diplomat calls for dialogue and mutual respect as trade framework advances toward potential deal in South Korea Chinese Foreign Minister Wang Yi urged the United States and China to resolve their disputes through dialogue rather than pressure, telling U.S. Secretary of State Marco Rubio during a phone call Monday that both sides should “meet each other halfway” ahead of the highly anticipated Xi-Trump meeting in Busan, South Korea, later this week. Wang emphasized that “healthy, stable, and sustainable” Sino-American relations were beneficial not only to both nations but also to the wider global community, according to Xinhua. He praised the longstanding relationship between President Xi Jinping and President Donald Trump, calling their mutual respect “the most precious asset” for bilateral ties. The conversation followed a preliminary framework deal reached in Kuala Lumpur between Chinese Vice-Premier He Lifeng and U.S. Treasury Secretary Scott Bessent, extending a temporary tariff truce and addressing contentious issues including rare earth export controls, fentanyl tariffs, and trade expansion. The truce, due to expire November 10, was seen as a critical step toward averting escalation. Wang said both nations had “clarified their positions, improved understanding, and reached a framework consensus on reciprocal solutions” during the talks. He urged Washington to create favorable conditions for continued engagement and to uphold equality, respect, and mutual benefit. The Busan meeting would mark the first face-to-face encounter between Trump and Xi since the start of Trump’s second term, coming amid renewed trade tensions and Beijing’s expansion of rare earth export curbs — a move that prompted Trump to threaten 100% tariffs on Chinese goods. —Sheinbaum announces extension of U.S./Mexico trade deadlineLeaders agree to prolong discussions on non-tariff trade barriers In a significant development on the U.S./Mexico trade front, President Claudia Sheinbaum announced that the United States has agreed to extend the deadline for finalizing a trade agreement with Mexico by several weeks. This announcement came following a brief discussion between Sheinbaum and President Donald Trump on Saturday, where both leaders consented to prolong negotiations to allow more time to address issues related to non-tariff trade barriers. Following this announcement, the Mexican peso experienced a surge to its session high. This move reflects investor confidence in the possibility of reaching a mutually beneficial trade deal in the extended timeframe. —NPPC: Trump opens Malaysian market to U.S. pork exportsTrade deal hailed by pork producers as a major win for American agriculture and rural jobs President Donald Trump has signed new trade agreements with Malaysia and Cambodia, marking a significant victory for U.S. pork producers. The Malaysia deal, in particular, offers enormous potential for America’s more than 60,000 pork producers by eliminating export barriers and expanding market access. “America’s pork producers are grateful to President Trump for increasing market access for U.S. pork to Malaysia,” said NPPC President Duane Stateler, a pork producer from Ohio. “More than 25% of U.S. pork production is exported, so producers count on exports to help keep their farms afloat, especially in times of uncertainty.” Under the agreement, all U.S. facilities listed in the FSIS Meat, Poultry and Egg Product Inspection Directory will be eligible to export to Malaysia without additional registration requirements. The country also agreed to accept standard FSIS export certificates and, within 15 months, recognize the U.S. African Swine Fever protection zone to complete a regionalization deal. Cambodia signed on to similar terms. NPPC credited USTR Ambassador Jamieson Greer, Assistant USTR Julie Callahan, and USDA technical teams for facilitating the breakthrough. U.S. pork exports to Malaysia reached $24.5 million in 2024, up 1,700% over the past five years, despite only eight U.S. plants being eligible for export. The sector supports over 140,000 American jobs and adds $66 in export value per hog marketed. NPPC emphasized pork producers rely on trade stability: “American pork producers need certainty and stability — now as much as ever — and NPPC will continue to engage with the administration and international partners to maintain and open new market access for U.S. pork.” —Largest gov’t union calls for clean CR to end shutdownAFGE President urges Congress to “put every single federal worker back on the job” as shutdown enters Day 27 The largest union representing federal employees is urging Congress to immediately pass a clean continuing resolution (CR) to end the government shutdown, now in its 27th day. American Federation of Government Employees (AFGE) National President Everett Kelley said in a Monday statement that “it’s time” for lawmakers to act decisively. “No half measures, and no gamesmanship,” Kelley declared. “Put every single federal worker back on the job with full back pay — today.” AFGE, which represents more than 800,000 workers across nearly every federal agency, has filed multiple lawsuits on behalf of furloughed and laid-off employees, including one against the Education Department over shutdown-related email autoreplies blaming Democrats. The union’s largest memberships include employees at the Departments of Veterans Affairs, Homeland Security, and Defense, as well as the Social Security Administration. The shutdown, which began Oct. 1, is now the second-longest in U.S. history. According to the Bipartisan Policy Center, about 670,000 federal workers have been furloughed and another 730,000 are working without pay. The Pentagon has been able to pay service members using previously appropriated funds, but that funding runs out at the end of October. Quote of note: “These are patriotic Americans – parents, caregivers, and veterans – forced to work without pay while struggling to cover rent, groceries, gas and medicine because of political disagreements in Washington. That is unacceptable,” Kelley said. House Republicans passed a CR last month that Speaker Mike Johnson (R-La.) called “clean” and “nonpartisan,” though it failed repeatedly in the Senate. Democrats have insisted that any reopening measure include an extension of Affordable Care Act subsidies, while Republicans have argued that issue should be negotiated later. Kelley said both parties have “made their point” and urged them to now focus on reopening the government, ensuring back pay, addressing rising costs, and fixing the “broken” appropriations process. “The national interest requires Congress to act immediately … without punishing the people who keep our nation running,” he said. —GOP crafts health care plan as ACA/ObamaCare subsidy showdown loomsSpeaker Mike Johnson says Republicans will propose “real reforms” instead of extending expiring ObamaCare subsidies during the shutdown House Speaker Mike Johnson (R-La.) said Monday that Republicans are developing a new health care proposal as part of broader negotiations tied to the ongoing government shutdown. Johnson said House Majority Leader Steve Scalise (R-La.) is working with three key committee chairs — Jason Smith (R-Mo.) of Ways and Means, Brett Guthrie (R-Ky.) of Energy and Commerce, and Tim Walberg (R-Mich.) of Education and Workforce — to compile a “Republican fix” for the health care system. “Republicans have been working on a fix for health care, we’ve been doing this for years,” Johnson said during a Capitol press conference, holding up an old policy framework he helped draft as chair of the Republican Study Committee from 2019–2020. He said the ideas have “been on paper for a long time” and now need to be unified into a workable plan. The GOP’s renewed health care push comes as enhanced Affordable Care Act (ACA) subsidies — expanded under President Biden — are set to expire at year’s end. Democrats are warning of a “health care cliff” that could leave millions facing steep premium hikes, while Republicans have refused to extend the subsidies without reopening the government first. Johnson called the expiring subsidies “a serious problem,” arguing that “we’re throwing good money at a bad, broken system.” Some Republicans, including Rep. Marjorie Taylor Greene (R-Ga.) and Sen. Josh Hawley (R-Mo.), have voiced concern about rising insurance rates following GOP-backed Medicaid funding cuts. Still, Johnson insisted any reforms must go beyond temporary extensions, saying the issue “is very complicated to fix” and shouldn’t be attached to a short-term spending bill. “But Republicans have a long list of ideas,” Johnson said. “Leader Scalise has been working with the chairmen of our three committees of jurisdiction — putting all of that, formulating all that, grabbing the best ideas that we’ve had for years, to put it on paper and make it work.” He added that the GOP must prepare to “arm wrestle with Democrats,” who he accused of being “avowed to get us to a single-payer system.” |
