Soybeans and Trade Concessions Emerge as Potential Trump/Xi Summit Bargaining Chips

State of Union address | White House faces timing questions on 15% global tariff order | PLC outlook shows lower payment rates — even with more base acres | USDA still working through final OBBBA guidance — payment limits and AGI rules leave farmers waiting

LINKS

Link: Video: Wiesemeyer’s Perspectives, Feb. 22

Link: Audio: Wiesemeyer’s Perspectives, Feb. 22

Updates: Policy/News/Markets, Feb. 24, 2026

UP FRONT

TOP STORIES

— Beijing sees opportunity after court limits U.S. tariff power: The Wall Street Journal reports China sees new leverage after the Supreme Court limited President Donald Trump’s emergency tariff authority, with Beijing floating “deliverables” like stepped-up purchases of U.S. soybeans, energy, and aircraft while pushing for tariff rollbacks and tech restrictions relief.

— White House faces timing questions on 15% global tariff order: Bloomberg reports uncertainty over whether a formal directive lifting the new Section 122 global tariff from 10% to 15% will be signed before the 10% rate takes effect just after midnight Tuesday, complicating importer compliance and potential transition adjustments.

— Trump weighs new national security tariffs after Supreme Court setback: The Wall Street Journal reports the administration is considering new Section 232 tariffs across roughly six additional industrial sectors (e.g., batteries, industrial chemicals, power-grid/telecom equipment) as it rebuilds a more legally durable tariff framework.

— FedEx sues Trump administration for tariff refunds: FedEx filed at the Court of International Trade seeking refunds (with interest) for IEEPA tariffs invalidated by the Supreme Court, potentially becoming an early test case for how — or whether — repayments are handled.

— Trump warns trading partners on tariffs after Supreme Court ruling: Trump escalated rhetoric, warning countries that test existing trade deals could face tougher duties, while the White House leans on Section 122 as a bridge and explores longer-lasting options under Sections 301 and 232.

— China regains some price competitiveness after tariff shift: With IEEPA tariffs removed, China’s effective tariff burden eases, improving near-term pricing — though major duties remain (notably Sections 301 and 232), and ING Economics says the switch to a flat Section 122 tariff creates clear winners/losers among import partners.

— Supreme Court to weigh state climate lawsuits against oil companies: The Court will take up whether states and municipalities can pursue climate-damages suits against oil firms in state court, a decision that could shape — or limit — dozens of similar cases nationwide.

— House Farm Bill 2.0 markup set for March 3 after weather delay: House Ag Chairman GT Thompson (R-Pa.) rescheduled the full committee farm bill markup for Tuesday, March 3 at 5 p.m. ET, starting formal amendment debate on the “Farm, Food, and National Security Act of 2026.”

FINANCIAL MARKETS

— Equities today: Global shares were mixed while U.S. futures ticked higher ahead of Trump’s State of the Union and a heavy lineup of Fed speakers; traders are watching today’s housing and confidence data for “Goldilocks” signals.

— Equities yesterday: Major U.S. indexes fell sharply (Dow -1.66%, Nasdaq -1.13%, S&P 500 -1.04%) as markets digested risk-off sentiment tied to tech/AI disruption and broader uncertainty.

— Trump set for 2026 State of the Union amid economic crosscurrents: Trump addresses Congress tonight with the White House pitching resilience, but polling shows voter unease on costs; growth looks steady, inflation still above target, and housing remains a key pressure point.

— Dimon warns of risky lending surge as credit cycle concerns grow: JPMorgan CEO Jamie Dimon cautioned that competition for yield is weakening standards and could set up “surprise” stress points in the next downturn, with AI-related disruption a potential fault line.

— Fed policy outlook hinges on jobs data: Fed Governor Christopher Waller said the March rate call is a “coin flip,” with the February jobs report likely decisive for whether the Fed holds or cuts 25 bps.

— Dollar decline seen as cyclical, not structural — ING Economics: ING says early-2026-dollar weakness reflects cyclical flows and global growth rotation rather than de-dollarization, while still flagging risks if fiscal or Fed-independence concerns intensify.

AG MARKETS

— NDSU Agricultural Trade Monitor: IEEPA tariffs and biofuel feedstocks: The monitor finds tariffs mainly redirected sourcing (not volumes) for U.S. renewable diesel feedstocks like used cooking oil and tallow, with demand staying strong; upcoming policy shifts (including Section 45Z-related constraints) could matter more than tariffs.

— New World Screwworm rumors trigger volatility — but fundamentals hold: Southern Ag Today analysis shows feeder cattle futures sold off sharply on unverified screwworm rumors, highlighting how headline risk can overwhelm tight-supply fundamentals in the short run.

— U.S. beef imports expected to rise in 2026: USDA projects imports up to 3% as tight cattle supplies persist; 2025 imports surged, processors face strain, and Brazil is positioned to benefit as U.S. buying stays aggressive.

— Agriculture markets yesterday: A mixed close across grains and livestock, with May corn slightly higher, soybeans and wheat lower, and cattle softer while lean hogs edged up.

FARM POLICY

— PLC outlook shows lower payment rates — even with more base acres: Citing Paul Neiffer’s CPA Farm Report, early USDA price projections suggest softer 2026 PLC payment rates overall, with expanded base acres potentially cushioning totals — and wheat the most likely to see a modest offset.

— Base acre expansion — when it actually starts: The up-to-30-million-acre base expansion under OBBBA begins with the 2026 crop year (not 2025), meaning any first payment impacts tied to 2026 production would generally arrive in fall 2027 or later.

— USDA still working through final OBBBA guidance — payment limits and AGI rules leave farmers waiting: Producers are delaying entity changes (e.g., partnership to LLC) as USDA has not issued final implementation details for payment limits, AGI verification, and new pass-through entity treatment, leaving compliance and planning uncertainty.

ENERGY MARKETS & POLICY

— Tuesday: oil prices hold near seven-month highs ahead of U.S.-Iran talks: Crude held firm on geopolitical risk and tariff uncertainty, with traders pricing a premium into the Geneva talks backdrop.

— Monday: Oil prices ease as traders weigh Iran talks and tariff uncertainty: Prices dipped modestly but stayed elevated, supported by geopolitical risk even as macro and trade-policy uncertainty capped upside.

— Big Oil recalibrates strategy as markets soften: Wood Mackenzie analysis says majors are prioritizing upstream longevity and tighter financial discipline as commodity outlooks cool, while U.S. gas demand tied to LNG and data centers remains a brighter spot.

TRADE POLICY

— SCOTUS tariff ruling triggers policy scramble across USTR, courts, and trading partners: The administration pivots toward Section 301 investigations and other tools as refund litigation grows and trading partners reassess deal terms under the post-IEEPA framework.

— CBO to rework tariff revenue forecasts after Trump’s new trade actions: CBO Director Philip Swagel says the agency will update tariff-revenue and deficit projections once the administration’s revised tariff plan is clearer, after the ruling disrupted prior baseline assumptions.

CONGRESS

— Senate Democrats push tariff refund bill after Supreme Court ruling: Led by Sen. Ron Wyden (D-Ore.), Democrats introduced a bill to require refunds (with interest) of invalidated IEEPA duties and to prioritize small businesses, while also positioning to contest extensions of the Section 122 tariff.

POLITICS & ELECTIONS

— Former USDA chief of staff weighs possible NY-22 congressional bid: Kailee Tkacz Buller is reportedly exploring a GOP primary run in New York’s 22nd against Rep. John Mannion (D-N.Y.), with the filing deadline April 3 and primary June 23.

— Gender gap re-emerges as key Democratic pathway in 2026: Democratic pollster Celinda Lake says Democrats tend to win when their margin with women exceeds the GOP margin with men, and recent polling showing large female disapproval of Trump could reopen that path.

FOOD POLICY & FOOD INDUSTRY

— Trump administration challenges California cage-free egg law in federal court: A federal hearing advanced the administration’s challenge to California’s cage-free egg requirements, spotlighting the interstate-commerce clash over state standards that influence national supply chains.

TRANSPORTATION & LOGISTICS

— Ships as a tariff workaround: The Maritime Action Plan’s new revenue lever: The White House is floating cargo-based fees on foreign-built vessels calling at U.S. ports as a tariff alternative, raising concerns about disproportionate impacts on heavy, low-value goods and broader trade costs.

— Panama moves to take control of Canal ports: After a court voided CK Hutchison’s concession, Panama ordered a temporary occupation of two strategic ports, with interim operators (including APM Terminals and an MSC unit) stepping in during transition.

WEATHER

— NWS outlook: A clipper brings heavy snow to the Great Lakes; northern California faces heavy rain and flood potential; unsettled conditions with heavy mountain snow persist across the West through Wednesday.

TOP STORIES — Beijing sees opportunity after court limits U.S. tariff powerSoybeans and trade concessions emerge as potential summit bargaining chips China leverage. Following the Supreme Court’s decision curbing President Donald Trump’s emergency tariff authority, Beijing sees new leverage ahead of upcoming U.S./China talks, according to the Wall Street Journal. The ruling lowers the effective U.S. tariff rate on Chinese goods and could reshape negotiations. Chinese officials are reportedly seeking tariff rollbacks and relief from U.S. technology restrictions, while considering “deliverables” such as purchases of U.S. soybeans, energy and aircraft to help advance a deal. For U.S. agriculture, especially soybean exporters, the prospect of renewed Chinese buying could be significant. China remains the world’s largest soybean importer, and increased purchases would offer support to U.S. export demand at a time when trade policy uncertainty has unsettled markets. The administration still retains other trade tools — including targeted investigations and national-security tariffs — meaning pressure on China could continue through more narrowly focused measures. Trump still holds formidable tools to threaten new tariffs over Beijing’s failure to meet past trade promises, namely the commitments struck under a trade agreement during Trump’s first presidency (Phase One agreement). The administration is currently conducting a legal inquiry into that trade agreement. If, as expected, the investigation finds that China failed to fulfill its obligations under that pact, the administration would have fresh legal grounds to impose broad tariffs on Chinese goods. — White House faces timing questions on 15% global tariff orderAdministration still drafting directive as 10% Section 122 duties prepare to take effect The White House is racing to finalize a formal order raising the new global tariff rate from 10% to 15%, but administration officials say it remains uncertain whether the directive will be completed before the lower rate takes effect just after midnight Tuesday, according to Bloomberg. What’s happening now. President Donald Trump signaled over the weekend that the global tariff — enacted under Section 122 of the Trade Act of 1974 — would be lifted from 10% to 15%. However, as of Monday evening, no executive order had yet been issued to legally implement that increase. An administration official said the White House is still working through the formal process needed to codify the change. That leaves importers and global trading partners facing uncertainty over which rate will actually apply when the new tariffs go live. Why the timing matters. U.S. Customs and Border Protection (CBP) has already issued operational guidance preparing importers for the 10% global levy, scheduled to begin at 12:01 a.m. Washington time Tuesday. Without a finalized presidential directive, customs officials are expected to enforce the existing published rate — at least initially. That creates a potentially awkward transition period:• Importers may face retroactive adjustments if the 15% order is signed shortly after implementation.• Customs systems and compliance filings could need rapid updates.• Global markets and supply chains may see short-term confusion over effective rates. Broader policy backdrop. The accelerated timeline comes after the Supreme Court’s ruling invalidating the administration’s previous IEEPA-based tariff authority, forcing the White House to shift toward Section 122 as a temporary bridge tool. That statute allows tariffs of limited duration — up to 150 days — while longer-term trade measures are pursued through other legal channels such as Section 301 investigations. The administration has framed the move as part of a broader strategy to maintain leverage over trading partners and stabilize the U.S. balance of payments. What to watch next. Key near-term questions for markets and importers include:• Whether the 15% directive is signed before or after the 10% tariff takes effect.• How CBP handles entries made during any transition window.• Whether the administration moves quickly to replace Section 122 tariffs with longer-duration authorities. For now, businesses are preparing for the 10% baseline while watching closely for a late-night or early-morning executive order that could raise the rate with little notice. — Trump weighs new national security tariffs after Supreme Court setbackAdministration looks to expand Section 232 duties as it rebuilds trade strategy beyond the court-struck tariff regime The Trump administration is considering a new round of national security tariffs targeting roughly six additional industrial sectors as it pivots following the Supreme Court’s decision to invalidate many of its second-term trade levies, according to reporting by the Wall Street Journal. Under discussion are potential tariffs on industries including large-scale batteries, cast iron and iron fittings, plastic piping, industrial chemicals, and power-grid and telecommunications equipment. The duties would be pursued under Section 232 of the Trade Expansion Act of 1962, which allows tariffs justified on national security grounds. Separate track from global tariff plan. The proposed Section 232 actions would be distinct from the administration’s new global 15% tariff — announced as a temporary replacement for duties struck down by the Supreme Court — and from future tariffs expected under Section 301 investigations. Section 232 tariffs have so far remained legally intact and outside the scope of the court’s ruling. President Donald Trump has already used this authority during his second term to impose duties on steel, aluminum, copper, autos, and auto parts, and those measures remain in effect. Investigations could broaden tariff coverage. The Commerce Dept. would be required to conduct formal investigations before new tariffs are imposed. While that process can take time, Section 232 gives the president wide discretion to modify tariffs once they are in place. The administration is also reportedly reviewing additional ongoing Section 232 probes covering other industries such as semiconductors, pharmaceuticals, drones, industrial robots, and solar-panel inputs. Some of those investigations were launched nearly a year ago and could be accelerated in response to the Supreme Court ruling, according to The Wall Street Journal. Policy shift after Supreme Court ruling. The renewed emphasis on Section 232 follows the Supreme Court’s 6-3 decision striking down most tariffs imposed under the International Emergency Economic Powers Act (IEEPA), finding that the administration exceeded its authority when applying broad reciprocal tariffs. Officials say the White House is now leaning more heavily on trade authorities less vulnerable to legal challenge. White House spokesman Kush Desai said the administration remains committed to using “every lawful authority” to protect economic and national security interests. Possible changes to existing steel and aluminum rules. In parallel, the administration is considering revisions to current steel and aluminum tariffs. While nominal rates on some products could decline, officials are discussing applying tariffs to the full value of imported goods rather than just their steel or aluminum content — a change that could increase total tariff costs for many importers. U.S. Trade Representative Jamieson Greer has also signaled that tariff calculations may be adjusted for compliance reasons as the administration reshapes its trade framework in the post-ruling environment. — FedEx sues Trump administration for tariff refundsShipping company seeks repayment after Supreme Court invalidated emergency tariffs FedEx filed a lawsuit seeking a full refund of tariffs paid under the International Emergency Economic Powers Act (IEEPA), becoming the first major U.S. company to sue for repayment since the Supreme Court ruled the levies illegal. The case, filed in the U.S. Court of International Trade, argues that companies should be reimbursed — with interest — because the duties were unlawfully imposed. The lawsuit could become a test case for how refunds are handled, as the Supreme Court’s decision did not outline a repayment process. While IEEPA tariffs have ended, duties under Sections 232 and 301 remain in place, and the administration has already shifted to new tariff authorities, keeping trade policy uncertainty high. — Trump warns trading partners on tariffs after Supreme Court rulingPresident signals tougher penalties for countries that challenge existing U.S. trade deals as administration recalibrates strategy President Donald Trump intensified his trade rhetoric Monday, warning that countries that “play games” with existing U.S. trade agreements could face even higher tariffs, following the Supreme Court decision that struck down his broader emergency-authority tariff framework. In a social media post, Trump said countries attempting to exploit the ruling — especially those he argued had “ripped off” the U.S. — would be hit with tougher duties than previously negotiated. The comments reflect the administration’s effort to preserve leverage and keep trade deals intact despite the court’s limits on executive tariff power. The ruling has already introduced uncertainty into global trade negotiations. The European Union moved to freeze ratification of its trade deal with Washington while seeking clarification on how the U.S. tariff program will proceed, and other partners — including China, Japan, South Korea, and the UK — are closely watching developments. Trump reaffirmed that he believes he can still move ahead without new congressional approval, pointing to the administration’s temporary use of Section 122 authority to impose a global tariff — initially set at 10% and then raised to 15% — as a short-term bridge while exploring more durable options under Section 301 and Section 232 trade laws. However, despite the aggressive messaging, the administration has not yet launched the formal investigations typically required before applying longer-term tariffs, leaving uncertainty about the next phase of U.S. trade policy and how quickly replacement measures can be implemented. — China regains some price competitiveness after tariff shiftIEEPA rollback lowers overall tariff burden, but major U.S. duties remain in place China stands to benefit from the removal of tariffs imposed under the International Emergency Economic Powers Act (IEEPA), which reduces its overall trade-weighted tariff burden versus the previous framework. The change does not eliminate tariff pressure entirely — a broad range of U.S. duties still applies — but it does ease China’s effective rate and improves near-term pricing dynamics. China remains subject to several key non-IEEPA tariffs, including:• Section 301 tariffs, implemented in response to alleged unfair trade practices, which range from roughly 7.5% to 100% depending on the product category.• Section 232 tariffs, imposed on national-security grounds, which range from 10% to 50% on steel, aluminum, and related sectors.• Trump’s recently announced 15% tariffs via Section 122 of the 1974 Trade Act. Key: Switching from the old IEEPA system to a flat 15% Section 122 tariff clearly creates winners and losers among the top U.S. import partners, says ING Economics. The biggest winners are countries that were previously hit with high IEEPA rates. They now see those heavy surcharges replaced by a much lower, uniform tariff. From a regional perspective, the removal of IEEPA tariffs represents a clear positive for Asia. China and India benefit the most, with tariff cuts of 7.1 points and 5.6 points, respectively. In their case, the new 15% rate is far better than the steep, country‑specific IEEPA tariffs they had been facing previously.

Note: The Section 122 tariff applies broadly to all imports, with several key exceptions. Products already subject to Section 232 duties – such as steel, aluminum, copper, lumber, and automobiles – are excluded to the extent that existing 232 tariffs remain in force. Approximately 1,100 product codes are fully exempt from the surcharge. Combined, these remaining measures continue to cover about 30% of U.S. imports from China, meaning tariff exposure is still significant. Even so, the rollback of IEEPA duties represents a meaningful positive for Chinese exporters. It lowers the average tariff load, restores some price competitiveness — particularly for consumer-oriented goods — and creates potential upside for export activity in the near term. The shift also increases the likelihood of front-loading, as exporters may accelerate shipments to take advantage of the reduced tariff exposure while conditions remain favorable. Bottom Line: The broader U.S./China trade relationship remains fragile and policy-driven, but for the moment, the tariff landscape has tilted modestly in China’s favor. — Supreme Court to weigh state climate lawsuits against oil companiesHigh court will decide whether local governments can seek billions in damages over greenhouse-gas impacts The U.S. Supreme Court has agreed to hear a closely watched case that could reshape climate litigation nationwide, taking up the question of whether states and municipalities can sue fossil-fuel companies in state court over harms tied to greenhouse-gas emissions. At the center of the dispute is a lawsuit brought by the city of Boulder, Colorado, which accuses oil and gas producers — including Suncor and ExxonMobil — of contributing to climate-related damages such as rising temperatures, worsening wildfires and deteriorating air quality. Boulder argues the companies knowingly sold fossil fuels despite understanding climate risks and is seeking compensation for past and future damages. Core legal question: state vs. federal authority. The companies contend that climate change and greenhouse-gas emissions are fundamentally national — even global — issues that must be governed by federal law, not by individual states or cities. In their argument, allowing local lawsuits would effectively let municipalities set national energy policy through the courts. Their appeal follows a Colorado Supreme Court decision that allowed the Boulder case to proceed in state court, rejecting claims that federal law preempts the lawsuit. The Supreme Court’s decision to hear the case signals interest in clarifying where the line lies between federal authority and state legal action on climate issues. Why this case matters. The outcome could influence dozens of similar lawsuits nationwide. Many municipalities have filed actions modeled after past tobacco litigation, seeking billions of dollars from oil and gas companies and alleging they misled the public about the links between greenhouse gases and climate risks. The companies have consistently denied wrongdoing. If the Court sides with the fossil-fuel companies, many local climate suits could be moved into federal court — where legal standards may be less favorable for plaintiffs — or dismissed altogether. A ruling favoring local governments could open the door for continued state-level climate damage claims. Broader legal backdrop. The case arrives amid ongoing legal battles over climate policy and environmental authority:• The Supreme Court previously declined to hear a similar case involving Honolulu, allowing that lawsuit to move forward.• In 2023, the Court allowed several municipal climate lawsuits to proceed.• A separate case involving a Louisiana community and a $745 million jury verdict against Chevron is also testing whether environmental damage claims belong in state courts.• In a landmark 2022 decision, the Court limited the Environmental Protection Agency’s ability to regulate greenhouse-gas emissions, signaling skepticism toward expansive federal climate regulation. Political and policy implications. The Trump administration took the unusual step of urging the Court to hear the Boulder case despite not being a direct party, highlighting the broader policy stakes. Industry groups argue that fragmented state litigation could create inconsistent energy rules, while local governments say they should be allowed to recover costs tied to climate-related impacts inside their borders. The ruling — expected later in the Court’s term — could define the legal pathway for climate accountability efforts in the U.S. and influence how communities pursue compensation for environmental harms moving forward.
— House Farm Bill 2.0 markup set for March 3 after weather delayFull House Ag Committee to take up the “Farm, Food, and National Security Act of 2026” in evening session House Ag Committee Chairman GT Thompson (R-Pa.) announced that the full committee markup of the farm bill is now scheduled for Tuesday, March 3, after the original session was postponed because of severe weather. The committee will convene at 5 p.m. ET in 1300 Longworth House Office Building, where lawmakers are expected to begin formal consideration of the “Farm, Food, and National Security Act of 2026.” The session will also be livestreamed, allowing stakeholders and market participants to follow amendments and debate in real time. This markup represents a key procedural step in advancing the farm bill, moving the legislation from drafting and negotiations into the amendment phase, where members can propose policy changes affecting commodity programs, conservation, nutrition assistance, and rural development priorities. The delay underscores how even routine procedural factors — such as weather disruptions — can compress legislative timelines, particularly as lawmakers face competing priorities on appropriations, trade, and budget issues this spring. Why this matters• Start of formal legislative action: Committee markups are where major policy decisions often emerge before floor debate.• Potential policy changes: Amendments could reshape reference prices, conservation funding, nutrition titles, and risk-management tools important to producers.• Political signal: Holding a late-day session suggests leadership is aiming to keep momentum despite recent scheduling disruptions.

FINANCIAL MARKETS

— Equities today: Global shares were mixed. In Asia, Japan +0.9%. Hong Kong -1.8%. China +0.9%. India -1.2%. In Europe, at midday, London -0.1%. Paris +0.1%. Frankfurt flat.

U.S. equity futures are modestly higher this morning as traders continue to digest yesterday’s “AI-disruption”-driven selloff while positioning ahead of President Donald Trump’s State of the Union address later tonight. There were no major economic releases overnight, leaving markets focused on today’s upcoming data and a heavy slate of Fed commentary. Early economic reports include the Case-Shiller Home Price Index (consensus: +1.3%), the FHFA House Price Index (consensus: +0.3%), and Consumer Confidence (consensus: 88.0). As in recent sessions, investors will be looking for “Goldilocks” data — evidence of steady growth alongside easing inflation pressures — to support a more durable relief rally. Fed officials are also set to be active throughout the day, with remarks scheduled from Goolsbee (8:00 a.m. ET), Bostic (9:00 a.m. ET), Collins (9:00 a.m. ET), Waller (9:15 a.m. ET), Cook (9:30 a.m. ET), and Barkin (3:00 p.m. ET).

The yen extended declines after media reported that Japanese Premier Sanae Takaichi voiced apprehension over interest-rate hikes.

In trade news, the U.S. is preparing to probe various imports, and the European Union warned that some new tariffs will breach deal terms.

— Equities yesterday:

Equity Index	Closing Price Feb. 23	Point Difference from Feb. 20	% Difference from Feb. 20
Dow	48,804.06	-821.91	-1.66%
Nasdaq	22,627.27	-258.80	-1.13%
S&P 500	6,837.75	-71.76	-1.04%

— Trump set for 2026 State of the Union amid economic crosscurrents

Address comes as White House highlights resilience while voters remain uneasy about costs and economic direction

President Donald Trump will deliver the 2026 State of the Union address to the 119th Congress tonight at 9 p.m. ET, using the primetime platform to promote his administration’s record and lay out priorities for the year ahead. The speech arrives at a politically challenging moment, with the president facing both domestic and global pressures and polling that shows continued public dissatisfaction with his leadership — particularly on economic issues.

Recent surveys underscore the political headwinds. A CNN poll released Monday placed Trump’s approval rating at 36%, down sharply from 48% a year earlier, reflecting voter anxiety about affordability and frustration over the administration’s response to cost-of-living concerns. While the White House is expected to emphasize a message of economic progress, the data present a mixed picture that complicates claims of a fully realized “golden age.”

Economy shows stability — but not a breakout. The latest economic indicators suggest an economy that is steady but far from booming. U.S. GDP grew 2.2% in 2025 — the slowest pace since the post-COVID expansion began — while a key core inflation measure ended the year at roughly 3%, still above the Federal Reserve’s 2% target.

The feared recession following Trump’s “Liberation Day” tariffs did not materialize, partly because the administration pulled back some levies while negotiating with trading partners. Inflationary pass-through from import duties has also been milder than many economists initially predicted.

The labor market has offered some brighter signals. Employers added about 130,000 jobs in January after a sluggish 2025, and unemployment edged down to 4.3%. Wage growth has outpaced inflation, allowing workers to see modest real income gains — a point the administration is likely to emphasize in tonight’s address.

Housing and consumers remain pressure points. Housing continues to weigh on the broader economic narrative. Home sales and new construction remain weak, with housing starts posting a fourth consecutive annual decline. Mortgage rates have fallen from around 7% early in Trump’s second term to roughly 6%, but they remain well above the levels many Americans were accustomed to before 2022, limiting affordability and market activity.

Consumer spending has held up better than expected, though momentum slowed late last year. Retail sales were resilient through much of 2025 but stalled in December. Wealthier households have helped sustain demand, while lower-income consumers appear to be pulling back amid slower wage gains and lingering concerns about everyday costs.

Political messaging meets public skepticism. Treasury Secretary Scott Bessent has framed 2025 as a year of policy groundwork — “laying the table” — with stronger results expected in 2026. Still, polling suggests voters are unconvinced that a recovery is translating into tangible benefits. A recent Washington Post-ABC News-Ipsos survey showed majorities disapproving of Trump’s handling of the economy, inflation and tariffs.

Economists note a disconnect between macro data and public sentiment. As Wolfe Research chief economist Stephanie Roth put it, the economy may be “fairly solid” on paper, but many voters continue to feel squeezed by high prices and limited affordability — a perception that the administration may struggle to reverse quickly.

Tonight’s speech is therefore likely to straddle two narratives: an administration arguing that policy foundations are set for stronger growth, and a public still waiting to feel meaningful relief in household budgets.

— Dimon warns of risky lending surge as credit cycle concerns grow

JPMorgan CEO says competition for yield is pushing firms toward lower standards, with private credit and AI disruption raising risks across the financial system

Aggressive competition and easing credit standards are pushing parts of the financial industry toward higher risk, according to JPMorgan CEO Jamie Dimon, who warned investors that the current environment resembles past periods that preceded downturns. Speaking during the bank’s annual investor update, Dimon said the race to boost profitability metrics is encouraging questionable lending behavior across markets.

Dimon cautioned that market participants should remain vigilant as risks build in areas such as private credit, non-bank lenders, fintech firms, and sectors facing rapid technological disruption from artificial intelligence. With asset prices elevated and the search for yield intensifying, he argued that conditions could leave some firms vulnerable when the cycle eventually turns.

Quote of note: “You feel stupid when everyone’s coining money and everyone’s great… it does feel really good,” Dimon said. “And then … I take a deep breath and say, ‘Watch out!’… We did see this in ’05, ’06 and ’07 — almost the same thing — the rising tide was lifting all boats.”

He added that some market players are taking excessive risks simply to generate net interest income, warning that such behavior often emerges late in credit cycles.

Credit-cycle risks may come from unexpected places. Dimon stressed that downturns rarely hit the sectors investors expect. Reflecting on previous cycles, he noted that utilities and telecom companies were unexpected casualties during the 2008–09 financial crisis. This time, he suggested, software companies could face pressure as AI rapidly reshapes business models and valuations.

“There’s always a surprise in a credit cycle… this time around, it might be software because of AI,” Dimon said, adding that elevated asset prices should be viewed as an additional risk rather than a source of comfort.

While he acknowledged uncertainty around what could trigger the next downturn, Dimon said his “anxiety is high,” emphasizing that cycles inevitably return even after prolonged periods of strong returns.

A CEO known for blunt macro calls. As the head of the largest U.S. bank for more than two decades, Dimon’s market comments carry significant weight. Under his leadership, JPMorgan’s conservative capital strategy helped the firm outperform many peers during the 2008 financial crisis. He has also made notable macro calls in recent years — including early warnings that inflation might prove persistent after the pandemic and that the Federal Reserve could need aggressive rate hikes.

Not all of his forecasts have been accurate. Dimon previously warned of an “economic hurricane” in 2022 and a likely recession in 2023 — scenarios that did not fully materialize — and his public stance on cryptocurrency evolved from calling Bitcoin a “fraud” to later expanding crypto-related services for clients.

Still, his latest warning underscores a recurring theme: when credit conditions appear easiest and profits look strongest, risks can quietly build beneath the surface — and the eventual adjustment can catch even seasoned investors off guard.

— Fed policy outlook hinges on jobs data

Governor Christopher Waller says March rate decision is a “coin flip,” with labor market trends likely to determine whether the Fed cuts or holds

Federal Reserve Governor Christopher Waller said Monday that his decision on whether to support an interest-rate cut at the Federal Open Market Committee’s March 17–18 meeting will depend heavily on upcoming labor-market data, underscoring how central employment conditions have become to the near-term policy debate.

Labor market is the deciding factor. Waller said recent data leave him weighing two nearly equal outcomes — either keeping rates steady or backing a 25-basis-point cut — describing the decision as “close to a coin flip.”

If February employment data confirm January’s stronger-than-expected labor conditions, Waller said keeping rates unchanged would likely make sense.

If the labor data weaken or January’s strength is revised away, he said it would support the rate cut he favored during the Fed’s January meeting.

Waller had dissented in January, preferring a quarter-point reduction because he viewed the labor market as showing signs of softness. While January job gains surprised to the upside, he warned the data may contain “more noise than signal,” noting revisions suggest overall job growth in 2025 was near zero — implying a labor market he characterized as “weak” and “fragile.”

The next key data point will be the February employment report, due March 6.

Inflation assessment and tariffs. On inflation, Waller reiterated that he continues to evaluate what he calls “underlying inflation,” excluding tariff impacts. He said inflation excluding tariffs appears close to the Fed’s 2% target.

The recent Supreme Court decision striking down some Trump administration tariffs is unlikely to materially change his policy outlook, according to Waller. This stance suggests that, in his framework, labor-market health — rather than tariff-driven price swings — will be the dominant input for near-term rate decisions.

Productivity and AI skepticism. During a Q&A session, Waller also downplayed the idea that artificial intelligence is currently driving U.S. productivity gains. He said recent improvements likely reflect other factors, including changing work arrangements after the COVID-19 era, rather than AI adoption at scale.

Balance sheet and liquidity policy. Waller addressed criticism of the Fed’s roughly $6.6 trillion balance sheet — an issue that has drawn attention from figures such as Kevin Warsh and Treasury Secretary Scott Bessent, who favor a smaller Fed footprint in markets.

He defended the Fed’s current “ample reserves” framework, arguing that moving back to a scarce-reserves system would create unnecessary inefficiency for banks and financial markets.

Bottom Line: Waller’s remarks reinforce that the Fed’s March decision remains highly data dependent. The upcoming employment report could tip the balance between holding rates steady or delivering a modest cut — making labor-market signals the primary catalyst for the next phase of monetary policy.

— Dollar decline seen as cyclical, not structural — ING Economics

ING Economics argues 2026 dollar weakness reflects shifting global growth and portfolio flows rather than a loss of confidence in the U.S. dollar

ING Economics says the U.S. dollar’s early-2026 decline should be viewed primarily as a cyclical adjustment, not a structural break in global confidence or a broad de-dollarization trend. In its Feb. 23 analysis, ING notes that while the dollar has weakened, it remains historically strong and still stands well above long-term averages on a real trade-weighted basis.

According to ING Economics, several factors are driving the softer dollar:

• Portfolio hedging and cyclical FX flows: Investors are gradually increasing dollar hedge ratios as hedging costs ease, implying continued moderate dollar selling rather than abrupt repositioning.

• Safe-haven role moderating, not disappearing: ING finds the dollar has lost some defensive appeal compared with 2024, but stresses this pattern has historically been cyclical rather than structural.

• Foreign demand for U.S. assets remains strong: Private global investors — especially in Europe — are still net buyers of U.S. equities and Treasuries, which ING says argues against a structural USD downturn.

• De-dollarization not accelerating: Key measures such as global FX reserves and market turnover show little evidence of a broad shift away from the dollar since 2024.

ING Economics emphasizes that the weaker dollar aligns with a more synchronized global growth cycle, where improving opportunities outside the U.S. are drawing capital toward emerging markets and other regions — a dynamic typically associated with dollar softness rather than U.S. economic deterioration.

Looking ahead, ING’s baseline calls for continued but orderly dollar weakness through 2026, supported by expectations for Fed rate cuts and a slower U.S. growth pace later in the year. The report projects EUR/USD rising toward 1.22 by year-end, while warning that a truly structural dollar sell-off would require more severe triggers — such as concerns over Fed independence or fiscal credibility.

Bottom Line: ING Economics frames the current dollar decline as part of the normal ebb and flow of global capital cycles — not a fundamental loss of the dollar’s reserve-currency status.

AG MARKETS

— NDSU Agricultural Trade Monitor: IEEPA tariffs and biofuel feedstocks

Tariffs reshaped sourcing patterns more than overall volumes, as U.S. biofuel demand stayed strong despite policy upheaval

The February 2026 NDSU Agricultural Trade Monitor (link) examines how the now-invalidated IEEPA tariff regime affected U.S. biofuel feedstock imports during 2025. The central takeaway is clear: tariffs altered where the U.S. sourced biofuel inputs rather than meaningfully reducing overall imports, highlighting strong underlying demand tied to renewable diesel expansion and evolving tax incentives.

Supreme Court ruling reset the tariff landscape. The report begins with the legal backdrop — the U.S. Supreme Court’s Feb. 20, 2026, decision that IEEPA does not authorize presidential tariff actions. Following the ruling, President Donald Trump quickly shifted to a temporary global tariff under Section 122 and signaled a move toward longer-term Section 301 and Section 232 actions.

This created a transition period in which markets and importers reassessed sourcing strategies while existing trade flows adjusted to new legal and policy uncertainty.

Used cooking oil (UCO): Strong demand, changing suppliers. UCO — a key renewable diesel feedstock — illustrates the main theme of trade diversion:

• China’s UCO exports to the U.S. fell roughly 55%, dropping from about 1.2 million metric tons to 540 thousand metric tons year-over-year through November.

• Imports shifted toward other suppliers, particularly Australia, South Korea, and Malaysia, which saw large percentage gains.

• Total UCO imports stayed historically elevated at roughly 2.0 million metric tons, only modestly below 2024 levels and far above the 2022-24 average.

Bottom line: tariffs changed supplier composition but did not substantially curb overall demand, reflecting continued renewable diesel capacity growth.

Tallow imports: Brazil loses share, Argentina gains. The report shows similar dynamics in animal-fat feedstocks:

• A 50% country-specific tariff on Brazil in August 2025 caused a sharp decline in Brazilian tallow shipments.

• Alternative suppliers — particularly Argentina — filled much of the gap.

• Overall tallow imports remained strong through 2025, suggesting substitution rather than contraction.

NDSU concludes that tallow increasingly served as a substitute when UCO supply tightened, reinforcing the view that tariff effects were redistributive rather than suppressive.

Aggregate feedstock imports: Diversion dominated destruction. When combining UCO, tallow, and canola oil, total imports from IEEPA-affected countries tracked close to — and at times slightly above — 2024 levels through most of the year.

Key interpretation from the report:

• Tariffs slowed import growth but did not drive a steep volume decline.

• The main adjustment margin was sourcing diversification away from high-tariff countries such as China and Brazil.

This is an important distinction for U.S. biofuel policy — demand remained firm even under higher trade costs.

Ethanol and biodiesel: Policy changes mattered as much as tariffs. Finished biofuel imports weakened, but the report emphasizes tax policy as a major driver:

• Brazilian ethanol imports fell about 37%, while non-IEEPA ethanol imports also declined.

• Biodiesel imports collapsed after the expiration of the $1.00/gallon blender’s tax credit and the shift to the Section 45Z production credit, which favors domestic production.

This suggests that regulatory and tax incentives may have had a stronger effect on trade flows than tariffs alone.

Additional policy headwinds emerging. Looking ahead, the report flags several factors likely to further suppress imported feedstocks:

• The One Big Beautiful Bill Act (OBBBA) limits Section 45Z eligibility to North American feedstocks after 2025.

• Proposed EPA rules would discount renewable fuel credits for foreign feedstocks by 50%.

Together, these policies could reduce imports structurally even if tariff regimes change again.

Trade data snapshot: broader agricultural implications. Beyond biofuels, the monitor highlights broader trade shifts:

• U.S. agricultural exports to China fell sharply (down roughly 66% year-to-date by value in 2025).

• Corn exports strengthened, while soybean exports declined significantly — reinforcing competitive pressure in global oilseed markets.

These trends underscore how tariff policy and feedstock markets are interacting with broader agricultural trade dynamics.

Key takeaway: The NDSU analysis finds that IEEPA tariffs mostly reshaped global sourcing patterns rather than reducing U.S. biofuel feedstock consumption. Strong domestic renewable diesel demand and evolving tax incentives kept import volumes elevated, even as suppliers shifted away from high-tariff countries. Going forward, policy changes tied to Section 45Z eligibility and renewable fuel credit rules may exert a more lasting influence than tariffs themselves.

— New World Screwworm rumors trigger volatility — but fundamentals hold

Southern Ag Today analysis shows how headline-driven panic briefly overwhelmed tight cattle-supply fundamentals in January futures trading

A new analysis (link) from Eunchun Park published in Southern Ag Today highlights how rumor-driven market psychology — rather than underlying cattle fundamentals — sparked a sharp but temporary sell-off in feeder cattle futures on January 16, 2026.

The episode offers a clear lesson for cattle producers navigating a market currently defined by two competing forces: historically tight cattle supplies supporting prices, and rising anxiety surrounding the potential spread of the New World Screwworm (NWS).

Tight supplies vs. headline risk. According to Park’s assessment in Southern Ag Today, the U.S. cattle herd remains at its lowest level in decades, creating structural supply support for higher prices. Normally, such tight supply conditions would keep futures markets firm.

However, since late 2025, the possibility that New World Screwworm could spread northward has inserted a significant “risk premium” into the market. That means price action is being influenced not only by physical fundamentals but also by fear of potential trade disruptions or disease-related restrictions.

Jan. 16: A case study in market psychology. The tension between fundamentals and fear became clear on Friday, January 16, 2026, when unverified rumors circulated claiming NWS had been detected in Texas or New Mexico.

Park notes that feeder cattle futures reacted instantly:

• Futures opened near $364.60/cwt

• Panic selling accelerated as rumors spread

• Prices plunged to roughly $355.30/cwt, nearly a $10 drop

• Trading approached “limit down” territory before partially recovering

• The market ultimately closed near $356.15/cwt

Trading volume surged during the decline, signaling a broad rush to exit positions rather than a change in actual supply conditions.

Data shows headlines — not fundamentals — drove the sell-off. Park’s analysis uses intraday pricing data combined with Google search activity to illustrate the cause of the crash.

As online searches related to NWS rumors spiked, both trading volume and selling pressure surged simultaneously — suggesting that information flow and algorithmic trading amplified fear-driven moves rather than reflecting real changes in cattle availability or demand.

The takeaway from Southern Ag Today’s analysis: the sell-off was largely psychological, triggered by headlines rather than physical market shifts.

Futures vs. cash market reality. One of the most important distinctions highlighted by Park is the difference between how futures and cash markets respond:

• Futures markets: React immediately to news, rumors, or worst-case scenarios

• Cash markets: Respond more gradually to physical supply-and-demand realities

Even as futures plunged, buyers in cash markets still needed cattle, meaning underlying demand remained intact. For producers, that disconnect can create risk — especially if marketing decisions are made during peak panic.

Risk management lessons for producers. Park argues that rushing to sell futures during a rumor-driven collapse effectively locks in a “panic discount.” Instead, allowing markets to stabilize after headline shocks may preserve value.

With volatility likely to remain elevated in 2026, the Southern Ag Today piece suggests flexible risk-management approaches may be more effective than rigid fixed-price hedging, including:

• Livestock Risk Protection (LRP) insurance

• Put options, which offer downside protection while preserving upside potential if fundamentals reassert themselves

These strategies help protect against a real outbreak while maintaining exposure to rallies driven by tight supplies.

Bottom Line: The New World Screwworm remains a legitimate biological concern, but Park concludes that the more immediate threat to producers may be volatility itself. Despite dramatic price swings triggered by rumors, the underlying cattle cycle — marked by tight supplies — remains unchanged. Producers who build marketing plans resilient to sudden headline shocks, rather than reacting to every rumor, are likely to be better positioned as 2026 unfolds.

— U.S. beef imports expected to rise in 2026

Tight cattle supply drives higher imports as processors and policymakers look abroad to stabilize prices

U.S. beef imports are projected to increase by up to 3% in 2026, according to USDA projections, as the U.S. cattle herd remains near multi-decade lows and domestic slaughter supplies stay tight. The supply shortfall is pushing meatpackers to rely more heavily on imported beef to meet demand.

Imports already surged 16% in 2025 to roughly 2.45 million metric tons, reflecting the shrinking number of slaughter-ready cattle. The strain on supply has contributed to operational pressure across the industry, with large processors such as JBS, Tyson Foods, and Cargill announcing plant closures earlier this year.

Brazil is positioned as a major beneficiary of sustained U.S. demand. Analysts expect the American cattle shortage to extend into 2027, supporting continued strong imports. Brazilian data show the U.S. had already used about 73% of its annual tariff-rate quota by early January 2026, signaling aggressive early buying. In 2025, the quota was fully utilized by mid-January, highlighting how quickly U.S. demand is absorbing available supply.

Brazilian exporters have responded accordingly, with shipments to the U.S. rising about 33% year over year, making the U.S. one of Brazil’s top beef destinations prior to additional tariff actions.

Meanwhile, expanded tariff-rate quota access for certain trade partners — including Argentina — could further diversify supply sources. President Donald Trump’s executive order in February to expand Argentine beef imports reflects the administration’s effort to ease domestic meat prices by increasing supply.

Market analysts say expectations of stronger U.S. buying are already supporting cattle futures, while ongoing herd contraction and livestock disease issues in Mexico may keep regional supplies tight. Overall, import demand is expected to remain elevated as the U.S. beef sector works through a prolonged rebuilding cycle.

— Agriculture markets yesterday:

Commodity	Contract Month	Closing Price Feb. 23	Difference from Feb. 20
Corn	May	4.40 1/4	+1/2 cent
Soybeans	May	11.49 3/4	-3 1/2 cents
Soybean meal	May	312.50	-$1.30
Soybean oil	May	59.88	+58 points
Wheat (SRW)	May	5.73 3/4	-6 1/2 cents
Wheat (HRW)	May	5.72 1/4	-13 cents
Spring wheat	May	5.82 1/4	-5 cents
Cotton	May	65.14 cents	-49 points
Live cattle	April	239.25	-$2.75
Feeder cattle	March	364.30	-$3.725
Lean hogs	April	93.70	+2 1/2 cents

FARM POLICY

— PLC outlook shows lower payment rates — even with more base acres

Paul Neiffer, CPA Farm Report: Early USDA price projections point to softer 2026 PLC payments, with wheat the lone crop potentially showing a slight gain after acreage adjustments

Drawing on analysis (link) published in Paul Neiffer’s CPA Farm Report, early projections tied to USDA’s latest Ag Outlook Forum (link) suggest farmers could see lower national PLC payment rates for the 2026 crop year, driven largely by expected changes in marketing-year average (MYA) prices.

According to the report, USDA’s preliminary outlook for corn, soybeans, and wheat — combined with an estimated rice MYA price of about 14 cents per hundredweight — was used to generate an early estimate of national PLC payments. The analysis notes these figures are highly preliminary, since planting for many of the affected crops has not yet begun.

Farm Program Estimates Table

Effective Reference Price

Commodity	2025 Effective Reference Price	2026 Effective Reference Price
Corn	$4.42	$4.42
Soybeans	$10.71	$10.71
Wheat	$6.35	$6.35
Rice	$0.1690	$0.1690

MYA Estimate

Commodity	2025 MYA Estimate	2026 MYA Estimate
Corn	$4.10	$4.20
Soybeans	$10.20	$10.30
Wheat	$4.90	$5.00
Rice	$0.1050	$0.1400

National PLC Yield

Commodity	2025 National PLC Yield	2026 National PLC Yield
Corn	141	141
Soybeans	41	41
Wheat	42	42
Rice	6,300	6,300

Estimated Payment Rate

Commodity	2025 Estimated Payment Rate	2026 Estimated Payment Rate
Corn	$0.32	$0.22
Soybeans	$0.51	$0.41
Wheat	$1.45	$1.35
Rice	$0.0640	$0.0290

Payment Per Acre

Commodity	2025 Payment Per Acre	2026 Payment Per Acre
Corn	$45.12	$31.02
Soybeans	$20.91	$16.81
Wheat	$60.90	$56.70
Rice	$403.20	$182.70

Net Rate based on Base Acre Increase @ 12%

Commodity	2025 Net Rate	2026 Net Rate
Corn	N/A	$34.74
Soybeans	N/A	$18.83
Wheat	N/A	$63.50
Rice	N/A	$204.62

Payment rates trending lower. The projection shows all major crops experiencing lower PLC payment rates compared with the 2025 crop year, reflecting higher projected commodity prices relative to reference price triggers.

However, the report highlights one important nuance: while payment rates are expected to decline, a roughly 12% increase in national base acres could partially offset the drop in overall payments. After factoring in that acreage adjustment, wheat may post a small year-over-year increase in total payments.

Key caveats for producers. The CPA Farm Report emphasizes several limitations to the early estimates:

• Payments shown do not include the automatic 15% reduction, since PLC payments are only made on 85% of base acres.

• Figures also exclude potential reductions tied to payment limits.

• Commodity outlooks remain fluid, and MYA price estimates could shift significantly as the growing season unfolds.

Early signal, not a final forecast. The bottom line from the analysis is that although expanded base acres may cushion some of the decline, they likely won’t fully compensate for lower payment rates if current projections hold. The report notes it is far too early for definitive projections, and updates are expected as USDA releases additional MYA estimates and planting progress becomes clearer.

Base acre expansion — when it actually starts The up to 30 million acre increase in base acres created under the One Big Beautiful Bill Act (OBBBA) takes effect beginning with the 2026 crop year — not 2025. 2025 crop year: ARC/PLC payments remain based on current base acres. 2026 crop year: New base acres become active for farm program purposes.• Eligibility uses planting history from 2019–2023.• USDA/FSA will allocate acres ahead of program elections. Payments tied to the 2026 crop year generally won’t be paid until October 2027 or later, since ARC/PLC payments are made after the marketing year. What this means. You’ll likely see three stages:• Implementation phase (now through 2026 sign-up). USDA FSA calculates eligible increases based on 2019–2023 planted/prevent-plant history. • Program election window (likely March 2026, although this could be delayed). Producers elect ARC vs. PLC using updated base acreage totals. • First financial impact:
2026 crop planted → programs apply with higher base.First potential checks tied to that increase → fall 2027. Because the law caps the expansion at 30 million acres nationwide, USDA may apply a pro-rated reduction if total eligible acres exceed that cap — meaning not every farm gets the full calculated increase.

— USDA still working through final OBBBA guidance — payment limits and AGI rules leave farmers waiting

Producers weighing LLC shifts hold off as USDA has yet to issue final implementation details

Farmers and farm advisors across the country are still waiting for USDA’s final guidance on how payment limitations and adjusted gross income (AGI) rules will be implemented under the One Big Beautiful Bill Act (OBBBA) — a delay that is already influencing business structure decisions at the farm level.

Producers considering moves from general partnerships into LLCs or other pass-through entities are largely choosing to wait, as USDA has not yet clarified how new statutory language will be applied in practice.

Bridge programs move forward — but not final OBBBA rules. USDA has moved ahead with operational guidance for the Farmer Bridge Assistance (FBA) program, which is intended to provide temporary relief until broader OBBBA provisions are fully implemented.

Current rules under FBA:

• $155,000 payment limit per person or legal entity (OBBBA standard).

• $900,000 AGI test for eligibility

• No enhanced limit for those deriving 75% of income from farming.

• Using pay limits and AGI of the Farm Bill, as amended by OBBBA, except they do not extend pay limit rules applicable to joint ventures and general partnerships to all pass-thru entities like the Farm Bill, as amended, does. That is a costly omission for farmers.

• Note: ECAP limit was $250K for those with 75% of *average* gross income coming from farming and $125K for those with less. They are reducing the pay limit, and they are going back to the more stringent *Adjusted* Gross Income test.

Key: A person or legal entity, other than a joint venture or general partnership, is ineligible for FBA Program payments, directly or indirectly, if the person’s or legal entity’s average adjusted gross income (AGI), using the average of the adjusted gross incomes for the 2021, 2022, and 2023 tax years, exceeds $900,000. A producer must be actively engaged in farming, as specified in 7 CFR part 1400, subparts C and G, to be eligible for the FBA Program.

However, USDA officials have emphasized that these provisions are essentially interim — relying largely on existing legal frameworks rather than the new entity structure envisioned under OBBBA.

For producers and accountants, that distinction matters. The current bridge program rules do not answer the larger questions surrounding how USDA will interpret new entity categories or payment attribution once permanent implementation occurs.

OBBBA introduces new entity questions. The legislation itself directs USDA to make several significant updates, including:

• Raising payment limitation thresholds to $155,000 per person

• Allowing annual inflation adjustments

• Creating a new “qualified pass-through entity” category

• Revisiting how joint ventures and general partnerships are treated for payment eligibility
(See information below for more details)

That new pass-through framework has become a focal point for producers evaluating whether shifting into LLC structures could unlock additional payment capacity or improve eligibility positioning.

But USDA has not yet released the implementing rulemaking or handbook revisions needed to define:

• Attribution and ownership tracing requirements

• Actively engaged in farming standards for new entities

• How pass-through entities may multiply or consolidate payment limits

• How AGI verification rules will apply under revised structures

Without those details, farm operators face a high degree of uncertainty.

Why farmers are waiting to restructure. Farm advisors say many producers are reluctant to make structural changes before final rules are issued — and for good reason. Historically, USDA has scrutinized entity changes made primarily for payment-limit purposes, especially when timing appears linked to new federal programs. If final guidance differs from producer expectations, early restructuring could lead to unintended compliance risks or limit flexibility later.

Several uncertainties continue to drive caution:

• Whether USDA will grandfather existing structures differently from newly formed entities

• How labor and management contributions will be documented under new rules

• Whether AGI exemptions tied to farm income shares will change

• How ownership attribution will apply to multi-member LLCs versus traditional partnerships

Until these questions are answered, many producers are choosing to delay entity changes despite growing interest.

No final handbook or rule yet. As of Feb. 23, USDA has not released:

• A final FSA handbook update implementing OBBBA payment-limit rules

• An interim final rule detailing entity treatment

• Federal Register guidance clarifying AGI treatment under the new law

County FSA offices are largely operating under existing frameworks while awaiting direction from USDA headquarters, according to industry discussions.

Timing expectations. Based on prior farm bill rollouts, industry observers expect USDA to issue an interim rule or handbook notice first, followed by county-level training and producer-facing clarifications.

With FBA enrollment now underway, many in the industry expect clearer implementation guidance to emerge later in the first half of 2026 — though USDA has not publicly confirmed a timeline.

Practical message for producers. For now, the working assumption inside the farm management community is straightforward:

• USDA has not finalized how OBBBA payment-limit and AGI provisions will apply to LLCs and other pass-through entities, meaning entity restructuring decisions should be approached cautiously until final guidance is published. On OBBBA, pass thru entities being treated same as GPs and JVs won’t kick in until 2026.

• Until USDA provides definitive rules, producers considering structural changes are likely to remain in a holding pattern — waiting for Washington to define how the new law will work on the ground.

$155,000 payment limit per person for ARC/PLC: The $155,000 limitation is the base total amount a person or legal entity can receive directly or indirectly for program year 2025, and future years. Beginning in program year 2025, the payment limitation amount will be adjusted annually for inflation based on the Consumer Price Index for all Urban Consumers as discussed in § 1400.106.

ENERGY MARKETS & POLICY

— Tuesday: oil prices hold near seven-month highs ahead of U.S.-/ran talks

Geopolitical risk and tariff uncertainty keep crude supported

Oil prices hovered near seven-month highs Tuesday as traders weighed the risk of supply disruption ahead of new U.S.-Iran nuclear talks in Geneva.

Brent crude held at $71.49 per barrel, while U.S. WTI edged up to $66.42, reflecting a persistent geopolitical premium in the market.

Tensions remain elevated as the U.S. and Iran prepare for a third round of negotiations, with Washington pushing for limits on Tehran’s nuclear program. Meanwhile, the U.S. has begun drawing down non-essential embassy staff in Beirut amid rising regional security concerns, and President Donald Trump warned Iran of consequences if talks fail.

Analysts say the market is pricing in the risk of escalation rather than outright conflict, helping keep prices firm. Added uncertainty from U.S. trade policy — including Trump’s threat to raise temporary tariffs to 15% — is also contributing to broader market caution.

— Monday: Oil prices ease as traders weigh Iran talks and tariff uncertainty

Geopolitics keeps a floor under crude while macro risks limit upside

Oil prices edged lower Monday but remained close to six-month highs as markets balanced geopolitical risk against renewed economic uncertainty.

Brent crude slipped 27 cents to settle at $71.49 per barrel, while U.S. West Texas Intermediate (WTI) fell 17 cents to $66.31, reflecting cautious positioning ahead of key diplomatic developments.

The primary focus for traders is a new round of U.S./Iran nuclear negotiations scheduled for later this week in Geneva. Tehran has indicated a willingness to consider concessions on its nuclear program in exchange for sanctions relief and recognition of its uranium enrichment rights. While diplomacy remains active, markets continue to price in a meaningful geopolitical premium due to the risk that negotiations could fail and escalate tensions in the Middle East — a region central to global oil supply.

Meanwhile, macroeconomic uncertainty continues to weigh on sentiment. Last week’s U.S. Supreme Court ruling striking down core elements of President Donald Trump’s tariff framework triggered fresh volatility in trade policy expectations. The decision prompted a temporary pause in some tariff collections by U.S. Customs and Border Protection, but subsequent signals from the administration suggesting a possible increase in a temporary blanket tariff rate to 15% added confusion for investors. Equity markets weakened amid concerns that prolonged trade uncertainty could slow economic activity and soften fuel demand, contributing to the modest pullback in crude prices.

Support in refined products helped offset some downside pressure. A winter storm across the Northeast lifted diesel crack spreads by roughly 5%, bolstering refinery margins and providing a partial cushion for the broader energy complex.

For now, crude markets remain trapped between competing forces — geopolitical risk supporting prices on one side and macroeconomic and trade-related uncertainty restraining gains on the other — with the upcoming U.S./Iran talks likely to determine the next significant directional move.

— Big Oil recalibrates strategy as markets soften

Q4 results highlight upstream urgency, tighter financial discipline, and cautious optimism around gas, AI, and data center demand

The latest fourth-quarter earnings season shows major oil companies entering a more defensive phase — balancing long-term production growth ambitions with weaker commodity markets and increasing pressure on cash flow. In analysis by Wood Mackenzie’s Simon Flowers, Chairman and Chief Analyst, and Gavin Thompson, Vice Chairman for Energy (Europe, Middle East & Africa), the central takeaway is clear: the industry’s primary strategic goal is strengthening upstream portfolios for the next decade, even as financial discipline tightens.

Commodity outlook turns cautious. Big Oil’s messaging on commodity markets has turned notably subdued. Companies are preparing for softer conditions across Brent crude, refining, petrochemicals, and global LNG, with growing concerns about an oversupplied gas market.

Production growth from firms such as TotalEnergies, Equinor, Chevron, and ExxonMobil has helped cushion earnings pressure, but management teams are increasingly focused on cost-cutting and trimming investment plans to protect margins.

The overarching message: growth remains a priority, but capital efficiency is once again front and center.

U.S. gas stands out as a brighter spot. While broader hydrocarbon sentiment is cautious, several companies expressed more optimism about U.S. natural gas.

The recent spike in Henry Hub prices is seen as an early indicator of tightening fundamentals. Analysts argue that rising demand — driven by rapid data center expansion and new LNG export capacity — will require higher-cost supply sources, potentially pushing gas prices higher over the rest of the decade.

Buybacks slow as balance sheets take priority. A major financial shift emerging from Q4 results is the pullback in shareholder distributions. The industry spent roughly $285 billion on share buybacks from 2022–2025 — a period now seen as ending amid weaker cash flow generation.

Recent moves include:

• Equinor reducing buybacks

• TotalEnergies lowering repurchase pace while targeting ~15% gearing

• BP halting buybacks entirely and shifting focus to debt reduction

BP, now under new leadership, is repositioning its narrative toward expanding a “world-class” upstream portfolio — with asset disposals expected to support deleveraging and financial flexibility.

Upstream portfolio renewal dominates strategy. The most important long-term issue for the Majors is preventing production decline after 2030. Companies are pursuing a three-pronged approach:

1) Discovered resource opportunities (DROs)

Access to long-life reserves is accelerating, with renewed interest in regions such as Libya and Iraq. Some firms are also evaluating Venezuela, though high project breakevens remain a constraint.

2) Mergers & acquisitions

M&A remains on the table but with caution. Companies acknowledge quality assets are expensive, and several — notably Shell — signal willingness to acquire but without urgency.

3) Exploration and execution focus

Exploration is regaining momentum. Examples include BP’s large Brazil discovery and TotalEnergies’ Namibia finds, which could evolve into major multi-FPSO developments later this decade.

Meanwhile, some firms are emphasizing organic execution over acquisitions. ConocoPhillips, for instance, is prioritizing free-cash-flow expansion through cost efficiency and project startup discipline rather than M&A.

Low-carbon strategies shrink — but aren’t gone. Low-carbon investment is contracting across the sector, though not disappearing entirely.

• BP recorded significant write-downs on low-carbon assets.

• Equinor signaled no new renewable investments beyond projects already underway.

• TotalEnergies remains an outlier, reporting positive operating cash flow and returns from its Integrated Power business.

The message from Q4: decarbonization efforts are increasingly expected to meet strict financial hurdles.

Data centers and AI emerge as a new growth theme. Big Oil is positioning itself to meet rising power demand from AI and data center expansion.

• TotalEnergies is partnering with large tech companies to capture premium pricing opportunities.

• ExxonMobil aims to sanction a decarbonized data-centre project using carbon capture by late 2026.

• Equinor reports early cost improvements from AI deployment, while TotalEnergies plans significant AI investment through 2028.

Management teams increasingly see AI as a tool to improve plant uptime and operational efficiency — potentially one of the fastest near-term value drivers.

U.S. consolidation signals the next strategic question. The Devon/Coterra merger reinforces a broader trend: scale is becoming essential in U.S. upstream markets. Many mid-cap producers have either been acquired or grown into “elite” large-cap status.

This raises a bigger strategic question posed by Flowers and Thompson: could the Majors eventually target this new class of large U.S. E&Ps to strengthen long-term production longevity?

Bottom Line: According to analysis by Simon Flowers and Gavin Thompson, Big Oil’s Q4 results show an industry transitioning from the cash-rich post-pandemic period into a more disciplined cycle. The priorities are clear:

• Strengthen upstream portfolios

• Preserve balance sheets

• Moderate shareholder payouts

• Explore new growth via gas demand, AI, and data center energy

In short, the Majors are preparing for a tougher commodity environment — while quietly positioning for the next decade’s energy demand shifts.

TRADE POLICY

— SCOTUS tariff ruling triggers policy scramble across USTR, courts, and trading partners

Trump administration pivots to new legal tools as refund fights, trade deals, and tariff continuity come under pressure

The Trump administration — alongside U.S. trade officials, foreign partners, and the courts — is rapidly responding to fallout from the Supreme Court’s decision striking down the legal foundation for tariffs imposed under the International Emergency Economic Powers Act (IEEPA).

At the center of the response is the Office of the U.S. Trade Representative (USTR), which is moving to rebuild tariff authority using alternative statutes while legal uncertainty spreads across existing trade agreements and refund claims.

USTR moves quickly to replace invalidated tariff authority. Following the ruling, President Donald Trump directed USTR to launch new investigations under Section 301 of the Trade Act of 1974, which Trade Representative Jamieson Greer said could recreate much of the former tariff regime.

Greer stressed that the administration sees this as a shift in legal tools — not in strategy. While the Supreme Court eliminated IEEPA-based tariffs, the White House has already implemented a 15% global tariff under Section 122, citing a balance-of-payments crisis. That authority, however, is temporary and expires after 150 days, pushing USTR to accelerate investigations designed to support longer-term tariffs.

Section 301 investigations — potentially announced this week — are expected to focus on a wide range of issues, including industrial overcapacity, forced labor, pharmaceutical pricing, discrimination against U.S. tech firms, digital services taxes, and environmental and agricultural trade concerns.

Greer emphasized that Section 301 and Section 232 authorities can allow the administration to maintain continuity in tariff policy despite the court ruling, saying the objective is to “reconstruct” existing trade leverage using legally durable mechanisms.

Courts face pressure over tariff refund chaos. The Supreme Court’s decision invalidated tariffs already collected under IEEPA, leaving billions of dollars in duties in legal limbo. Importers have filed hundreds of lawsuits seeking refunds, and the Court of International Trade (CIT) is now expected to determine whether companies are entitled to reclaim those payments — and under what conditions. Greer acknowledged the lack of guidance from the Supreme Court, noting that lower courts must now clarify whether refunds apply broadly or only to companies that filed formal claims.

Trump himself has suggested the issue could remain tied up in litigation for years, signaling a prolonged legal battle that could shape future executive trade authority.

The ruling also complicates the administration’s previous decision to suspend the de minimis program, which allowed goods valued under $800 to enter duty-free. Because that suspension relied on IEEPA authority, importers who paid tariffs on qualifying shipments may also pursue refunds, further widening the legal fallout.

Trade deals thrown into uncertainty. The decision is reverberating internationally, raising questions about trade agreements negotiated under tariff rates that no longer exist.

In Europe, lawmakers have paused approval of the EU/U.S. “Turnberry” trade deal after concluding that the interim Section 122 tariffs appear inconsistent with its terms. The agreement had capped most U.S. tariffs on EU goods at 15% including most-favored-nation (MFN) rates, but the new U.S. tariffs are applied on top of MFN duties — pushing some products above agreed levels.

European officials have called for clarity and legal certainty before moving forward, while similar concerns have surfaced in the United Kingdom, where officials raised questions about maintaining the previously negotiated baseline tariff framework.

Despite those concerns, Greer has downplayed the risk of agreements collapsing, arguing that trading partners expected tariffs to remain in place regardless of litigation outcomes and that conversations with counterparts remain active.

Political backdrop intensifies. The tariff dispute is unfolding as Trump prepares to deliver a State of the Union address tonight before the same Supreme Court justices who issued the ruling, adding a symbolic and political dimension to the legal and economic debate.

The administration’s core message remains clear: tariff policy will continue, even if the legal foundation changes. The immediate challenge now is whether the courts, USTR, and U.S. trading partners can navigate the transition without prolonging uncertainty for importers and businesses already adapting to shifting trade rules.

Why this matters.

• Short term: Section 122 keeps tariffs in place temporarily but creates a tight clock for new legal justification.

• Medium term: Section 301 investigations could reshape global trade tensions and expand sector-specific tariffs.

• Legal risk: Refund cases and de minimis challenges could expose the government to significant financial liability.

• Diplomatic risk: Existing trade agreements face new strain as partners reassess legal certainty under U.S. tariff policy.

Overall, the Supreme Court ruling hasn’t ended the tariff era — it has simply moved the battle into new legal arenas where policy, diplomacy, and litigation now intersect.

— CBO to rework tariff revenue forecasts after Trump’s new trade actions

Supreme Court ruling and shifting tariff authority force fresh budget calculations

The Congressional Budget Office (CBO) plans to revise its fiscal outlook after President Donald Trump moved forward with a revised tariff strategy following the Supreme Court decision striking down tariffs imposed under the International Emergency Economic Powers Act (IEEPA).

Speaking at the National Association for Business Economics conference in Washington, CBO Director Philip Swagel said the agency is monitoring the administration’s response and will update its projections once policy details are finalized. The office recently estimated that tariffs could generate roughly $3 trillion in revenue over ten years, but that projection now requires recalculation given the legal changes and new tariff structure.

Swagel said the ruling could affect roughly $130 billion in import duties collected during calendar year 2025, though uncertainty remains over how those funds will ultimately be treated — including whether refunds or alternative enforcement mechanisms emerge. He indicated the agency could reflect updated information in its spring budget update, expected sometime between April and June, or earlier if policy clarity develops.

The fiscal rethink comes after the Supreme Court ruled that the Trump administration’s IEEPA-based tariff regime exceeded executive authority, forcing a shift toward alternative trade statutes. In response, Trump announced a 10% global tariff under Section 122 of the Trade Act of 1974, later signaling plans to raise that rate to 15%, a move designed to temporarily preserve tariff revenue while longer-term trade investigations proceed.

The tariff recalculations will feed into broader fiscal projections already under pressure. Earlier this month, CBO raised its ten-year deficit outlook by $1.4 trillion, citing a mix of factors including Trump-era tax and immigration policies. Adjustments to expected tariff income — either up or down — could materially alter how lawmakers evaluate budget negotiations heading into the next fiscal cycle.

Overall, CBO’s pending revisions underscore how quickly the legal and policy landscape around trade has shifted — and how central tariff revenue has become to federal budget expectations amid rising deficits and ongoing trade realignment.

CONGRESS

— Senate Democrats push tariff refund bill after Supreme Court ruling

Legislation would require repayment of up to $175 billion in invalidated Trump-era IEEPA tariffs and prioritize relief for small businesses

Senate Democrats on Monday introduced legislation requiring the Trump administration to refund up to $175 billion in tariff revenues collected under the International Emergency Economic Powers Act (IEEPA) — duties that the Supreme Court ruled last week were imposed unlawfully.

The bill directs U.S. Customs and Border Protection (CBP) to repay all “unlawfully collected duties” within 180 days of enactment and requires that interest be included in refunds. Lawmakers say the goal is to provide quicker relief to importers and small businesses that absorbed higher costs under the tariff regime.

Leading sponsor Sen. Ron Wyden (D-Ore.) argued that the tariffs functioned as an “illegal tax scheme” that hurt households, manufacturers, and small firms, and said the measure is intended to put money back into businesses’ hands as quickly as possible.

Supreme Court decision leaves refunds unresolved. The Supreme Court’s 6–3 decision ruled that President Trump exceeded his authority under the 1977 IEEPA statute when imposing broad tariffs on foreign trading partners. However, the justices did not address whether tariffs already collected must be refunded — leaving that question to lower courts.

Treasury Secretary Scott Bessent said over the weekend that refund decisions now rest with lower court proceedings, noting that the Supreme Court specifically declined to provide guidance on repayments or timelines.

Small businesses at center of proposal. The Democratic bill would require CBP to prioritize small businesses in processing refunds and coordinate with the Small Business Administration to help companies navigate claims. The legislation also mandates that CBP submit 30-day progress reports to Congress until all refunds are completed.

Sponsors including Sen. Ed Markey (D-Mass.) and Sen. Jeanne Shaheen (D-N.H.) argued the tariffs raised costs for consumers and created prolonged uncertainty for businesses, making a streamlined refund process critical.

Broader fight over new tariffs. The refund legislation comes as Senate Democrats also move to challenge Trump’s new 15% global tariff imposed under Section 122 of the Trade Act of 1974. Senate Democratic Leader Chuck Schumer (D-N.Y.) said Democrats will attempt to block extensions of the tariff once the initial 150-day authority expires later this summer. Under Section 122, the president can impose temporary tariffs of up to 15% to address serious trade deficits, but congressional approval is required for any extension beyond that period.

Bottom Line: The bill has little chance of passage, but it will serve as a Democratic messaging plank in this year’s midterms. The proposal signals a two-track Democratic strategy: forcing repayment of past tariffs invalidated by the courts while simultaneously trying to limit the administration’s ability to replace them under alternate trade authorities. Whether refunds ultimately materialize will likely depend on both congressional action and pending lower-court rulings.

POLITICS & ELECTIONS

— Former USDA chief of staff weighs possible NY-22 congressional bid

Kailee Tkacz Buller reportedly exploring GOP primary challenge as race against Rep. John Mannion begins to take shape

Multiple media reports indicate that Kailee Tkacz Buller, a former senior Trump administration official at USDA, is considering a run for Congress in New York’s 22nd District, potentially entering the Republican primary to challenge freshman Rep. John Mannion (D-N.Y.).

Considering entering the race. Political outlets and congressional reporters say Buller — who recently stepped down as chief of staff to Agriculture Secretary Brooke Rollins — has been discussing a possible campaign with advisers and supporters, though she has not publicly confirmed her intentions. Sources familiar with the situation told reporters that she is evaluating the race as filing deadlines approach.

Exit from USDA fuels speculation. Buller departed her USDA post last week after serving as one of the department’s top political appointees. Her exit quickly triggered speculation in Washington and New York political circles that she could pursue elected office, given her background in agricultural and energy policy as well as ties to Republican lawmakers and industry groups.

Before joining USDA, Buller held policy roles connected to agriculture and biofuels advocacy and worked within Republican policy networks during and after the first Trump administration — credentials that could provide appeal in a district with both agricultural and industrial constituencies.

Race timeline and current field. The filing deadline to enter the New York congressional race is April 3, with the Republican primary scheduled for June 23. Several Republicans are already running or preparing campaigns, while Mannion is currently unopposed on the Democratic side, according to election tracking reports and media coverage.

Mannion, a former New York state senator, won the Syracuse-area district in 2024 and is viewed as a first-term Democrat defending a seat that both parties see as competitive in a presidential-cycle environment.

Political outlook: If Buller formally enters the race, analysts say her Trump-administration background could quickly elevate her profile in the GOP primary, particularly among voters focused on trade, agricultural policy and federal regulatory issues. At the same time, a crowded primary field could create competition for conservative and establishment support as Republicans attempt to position the district as a potential pickup opportunity in 2026.

For now, Buller has declined to comment publicly on whether she will run, leaving the race in a watch-and-wait phase as deadlines draw closer.

— Gender gap re-emerges as key Democratic pathway in 2026

Polling suggests Democrats may regain an electoral advantage if women’s disapproval of Trump outweighs GOP gains with men

One of the clearest historical indicators of Democratic success is the size of the gender gap — specifically, when Democrats win women voters by a larger margin than Republicans win men, Democratic pollster Celinda Lake told political analyst Ronald Brownstein.

According to Lake’s framework, Democrats met that benchmark during the 2018 midterm and 2020 presidential elections, both of which produced strong Democratic outcomes. However, they failed to do so in the 2022 midterm and 2024 presidential contests, where exit polls showed a narrower advantage among women and stronger Republican performance with men.

Current polling heading into the November cycle suggests the equation may be shifting again. Surveys show President Donald Trump running roughly even among male voters, but facing pronounced weakness among women. In many recent national polls, roughly 60% or more of women say they disapprove of his job performance — a gap that could provide Democrats with a critical opening if it translates into turnout and vote margins.

The emerging trend points to a familiar dynamic in modern U.S. elections: when the gender divide widens sharply, it can reshape the national electoral map. Democrats appear encouraged that strong female opposition combined with competitive numbers among men could put them back on what Lake describes as the “winning side” of the electoral equation heading into November.

FOOD POLICY & FOOD INDUSTRY

— Trump administration challenges California cage-free egg law in federal court

Federal hearing marks latest legal clash over animal-welfare standards, state authority, and national egg markets

The Trump administration’s lawsuit challenging California’s cage-free egg requirements moved forward Monday with a hearing in federal court, spotlighting a growing conflict between federal trade authority and state animal-welfare regulations.

The case centers on California’s cage-free egg mandate — often associated with Proposition 12 — which requires that eggs sold in the state come from hens raised with specified space and housing standards, even when the eggs originate from out-of-state producers. The administration argues the law places undue burdens on interstate commerce and raises costs for producers and consumers nationwide.

Federal/state conflict over agriculture rules. At the heart of the dispute is whether a single state can effectively shape production standards beyond its borders by conditioning market access on compliance with its own rules.

Federal attorneys contend that California’s requirements interfere with national agricultural markets and create compliance costs for producers in other states, many of whom have had to invest heavily in cage-free housing systems to retain access to the large California market. Industry groups supporting the challenge say the mandate distorts egg supply chains and contributes to higher food prices.

California officials, meanwhile, defend the law as a voter-approved animal-welfare measure that reflects consumer demand for higher production standards. They argue that producers remain free to sell eggs elsewhere if they choose not to comply.

Broader policy and market implications. The hearing is being closely watched across agriculture because a ruling could influence how far states can go in setting production requirements that affect national supply chains — including livestock housing, environmental standards, and food labeling policies.

Egg producers and farm groups warn that inconsistent state standards could fragment markets and raise compliance costs, while supporters of the law say it gives consumers greater transparency and drives welfare improvements.

The case also fits into the broader legal and policy debate surrounding California’s livestock welfare laws, which have previously prompted challenges from pork, beef, and other agricultural sectors.

What comes next. The federal hearing Monday did not produce an immediate ruling, but it marks an important procedural step in determining whether the lawsuit will proceed toward a full trial or be resolved through early legal motions.

The outcome could set a significant precedent for future disputes over state-level agricultural rules and how they intersect with interstate commerce — an issue that has become increasingly important as states pursue differing environmental and animal-welfare policies.

TRANSPORTATION & LOGISTICS

— Ships as a tariff workaround: The Maritime Action Plan’s new revenue lever

White House proposal targets foreign-built vessels with cargo-based fees, potentially reshaping trade costs and port economics

The Trump administration’s Maritime Action Plan (MAP) is emerging as a potential new trade-policy tool after the U.S. Supreme Court curtailed the administration’s authority to impose emergency tariffs. The plan would place “universal fees” on cargo arriving at U.S. ports aboard foreign-built ships, creating what some analysts see as a de facto tariff alternative.

Under the proposal, cargo entering the U.S. on non-U.S.-built vessels could face fees ranging from 1 cent to 25 cents per kilogram. Administration estimates suggest the policy could raise as much as $1.5 trillion over a decade — roughly $150 billion annually — rivaling or exceeding recent tariff revenue totals.

A new mechanism after the court ruling. Following the Supreme Court decision limiting emergency tariff authority, the MAP fees could provide President Donald Trump with another revenue and leverage tool in trade negotiations. Customs duties generated between $130 billion and $180 billion in 2025, including emergency tariff collections, and the administration has argued that such measures help fund broader economic priorities — including tax cuts.

The MAP’s language indicates the fees could fund a new Maritime Trust Fund aimed at rebuilding U.S. shipbuilding capacity, but the wording leaves flexibility for other uses, raising questions over whether the plan is primarily industrial policy or revenue generation.

Industry concerns: a broad tax on trade. Critics argue the fee design may create uneven effects across industries because the charges are based on cargo weight rather than value. That means low-value, heavy goods — including many commodities and industrial inputs — would face proportionally larger cost increases.

Shipping and logistics observers warn that the measure could:

• Raise landed costs for importers

• Add pricing uncertainty across supply chains

• Impact exporters and logistics competitiveness

• Create downstream inflationary effects for consumers

Some industry voices have described the proposal as effectively a tax on global trade that fails to differentiate between essential goods, strategic cargo, or high-value imports.

Ports and shipping lines already facing uncertainty. The policy discussion comes amid significant disruption in global trade following the tariff ruling. Port officials say uncertainty remains over whether previously collected duties will be refunded, while traders and carriers are also adjusting to the administration’s newly announced 10% global tariff.

Gene Seroka, executive director of the Port of Los Angeles, highlighted the uncertainty surrounding tariff refunds and future trade policy timing — especially during seasonal slowdowns tied to the Lunar New Year, when many Asian factories temporarily close.

At the same time, ocean carriers are entering contract negotiations in a market where excess shipping capacity has pressured freight rates. Whether new cargo fees would allow carriers to raise prices remains unclear, particularly if demand weakens or competitive pressures persist.

What happens next. The MAP fees are still proposals and would require formal implementation guidance before taking effect. Major shipping firms, including Maersk, have advised importers to continue following existing customs requirements until official rules are released.

If enacted, the policy could mark a significant shift — moving U.S. trade strategy from direct tariffs toward port-based cargo charges, potentially reshaping how global trade is taxed and how costs flow through supply chains.

— Panama moves to take control of Canal ports

Court ruling voids CK Hutchison concession — government orders temporary occupation while new operators step in

Panama’s government has ordered the temporary occupation of two key ports near the Panama Canal after the country’s constitutional court struck down a long-standing concession held by a subsidiary of Hong Kong–based CK Hutchison Holdings.

President José Raúl Mulino said the administration and operation of the facilities will temporarily revert to Panama’s National Maritime Authority to ensure uninterrupted, safe and efficient port operations. The order applies to movable equipment — including cranes — but does not permanently strip ownership rights. Officials said property will be returned or compensated once the legal situation is resolved or new contracts are finalized.

Interim operators named. While the government manages the transition, new operators will step in on an interim basis:

• APM Terminals, part of AP Moller-Maersk, is expected to run one of the ports.

• A local unit of MSC Mediterranean Shipping Company will operate the second port pending a new bidding process.

Legal and geopolitical backdrop. Panama’s top court invalidated CK Hutchison’s port concession in January, reshaping control over infrastructure that sits alongside one of the world’s most strategic shipping lanes. The ruling followed an audit announced in early 2025 by Panama’s comptroller general and has drawn international attention given the broader geopolitical competition around global logistics and critical infrastructure.

The move is widely viewed as a setback for Chinese-linked commercial interests in the region. U.S. Secretary of State Marco Rubio publicly welcomed the ruling, underscoring the geopolitical sensitivity surrounding management of facilities tied to the Panama Canal.

What happens next. Panama’s government will oversee operations while a new bidding process is prepared.

Interim operators are expected to maintain cargo flow and operational continuity.

The state says the occupation is temporary and tied only to ensuring continuous service during the legal and contractual transition.

Bottom Line: The decision shifts short-term control of two strategic canal ports back to the Panamanian state and opens the door for a new competitive bidding process — a development likely to carry both commercial and geopolitical implications for global shipping routes.

WEATHER

— NWS outlook: Clipper system to bring heavy snow to the Great Lakes today… …Pacific low-pressure system will bring heavy rain and flood potential to northern California today… …Unsettled weather, with heavy mountain snow, across the West through Wednesday.

REFERENCE LINKS TO KEY TOPICS

2025 review | 2026 issues | Policy timelines |