Trump/Xi Summit Signals Broader Strategic Bargaining as Trade & Iran Tensions Escalate

U.S. industry pushes cotton as part of ag trade agenda during Trump/Xi confab | Brazilian industry to push for more access to U.S. beef market

Link: Video: Wiesemeyer’s Perspectives, May 2
Link: Audio: Wiesemeyer’s Perspectives, May 2

TOP STORIES

— Middle East war: oil, stocks, and U.S. grain markets swing on U.S./Iran deal hopes: Markets are trading on ceasefire probabilities, with oil volatility driving equities higher and creating mixed pressure on grain markets via biofuels and fertilizer costs.

— Gasoline prices diverge sharply across U.S. as West Coast premium widens: Regional fuel disparities remain extreme, with West Coast prices above $5.50 while much of the South stays near or below $4.

— Gasoline price surge threatens consumer spending momentum: Rising fuel costs are crowding out discretionary spending, hitting lower-income households hardest and raising broader demand concerns.

— Trump hosts Brazil’s Lula at White House for high-level talks: U.S.–Brazil discussions center on trade, agriculture, and energy, with beef quotas and broader market access key issues.

— USDA signals imminent foreign land rule overhaul, weighs fertilizer tariff decision: USDA is preparing a modernization rule on foreign land ownership while the administration debates Moroccan fertilizer duties amid cost pressures.

— Historic drought deepens as farm bill debate intensifies: Widespread U.S. drought is worsening production risks and increasing urgency around farm bill safety net provisions.

— Diesel price spike ripples through agriculture and rural economy: Elevated diesel costs are tightening farm margins and raising risks for harvest logistics and rural inflation.

— Trump/Xi summit signals broader strategic bargaining as trade and Iran tensions escalate: Upcoming talks are shaping into a high-stakes negotiation involving Taiwan, Iran, and global trade alignment.

— Daines thanks China for Iran diplomacy, pushes Boeing sales ahead of Trump/Xi summit: Congressional delegation highlights China’s Iran role while pressing for expanded U.S. exports.

— Cotton trade emerges as secondary focus ahead of Trump/Xi Beijing summit: Cotton is positioned as part of broader agricultural trade concessions, though not a primary negotiating item.

— EU struggles to finalize U.S. trade pact as tariff threats intensify: Lack of progress raises risk of higher U.S. auto tariffs and renewed transatlantic trade tensions.

FINANCIAL MARKETS

— Equities today: Global markets were mixed as investors weighed Iran deal prospects, with strong gains in Japan and muted U.S. futures.

— Equities yesterday: U.S. indexes rallied sharply, with the S&P 500 reaching a record high and exiting correction territory.

— Yuan strength tests China’s export engine: A stronger yuan supports global ambitions but pressures exporters through reduced price competitiveness.

— Kalshi lands $1 billion as prediction markets surge: Rapid growth and institutional adoption are driving valuation gains while regulatory scrutiny persists.

AGRIBUSINESS

— McDonald’s flags ‘challenging’ consumer environment despite earnings beat: Slower traffic reflects consumer strain from fuel and food inflation despite solid financial performance.

— Beyond Meat struggles persist as demand softens and revenue outlook disappoints: Weak demand and pricing resistance continue to weigh on growth despite narrowing losses.

AG MARKETS

— U.S. export sales activity to China still mostly shifting sales from unknown destinations: Export activity suggests reallocations rather than new demand growth, particularly in soybeans and sorghum.

— Global grain markets ease as Black Sea outlook improves: Lower oil prices and improved supply expectations are pressuring global wheat and oilseed markets.

— Overnight U.S. grain markets: Grain futures weaker at electronic close; wheat leads downside pressure: Broad selling led by wheat reflects favorable weather and weaker outside markets.

— Indonesia eyes rare rice export to Malaysia as supplies swell: Strong domestic production is enabling a shift toward exports in a traditionally import-dependent market.

— U.S. meat exports show diverging trends as pork surges and beef adjusts to China absence: Pork demand remains robust while beef exports rely on value gains and alternative markets.

— Argentina scrambles to protect soy exports after GMO rejections: HB4 contamination risks are threatening EU access, forcing segregation and trade diplomacy.

— Agriculture markets yesterday: Broad commodity weakness was led by grains, while livestock markets were mixed.

FERTILIZER

— Senate Ag Committee targets fertilizer costs in upcoming hearing: Lawmakers will examine supply disruptions, pricing, and domestic production strategies.

— Fertilizer profits surge as war disrupts global supply chains: Tight supply and higher nitrogen prices are driving strong earnings for major producers.

ENERGY MARKETS & POLICY

— Thursday: Oil pullback and equity strength mask mounting pressure on consumers and aviation sector: Lower crude prices are easing markets but fuel costs continue to strain households and airlines.

— Wednesday: Oil prices slide on U.S./Iran deal hopes: Anticipation of Hormuz reopening triggered a sharp selloff despite tight supply conditions.

— U.S. fuel exports surge to record as Hormuz disruption reshapes global energy flows: Strong export demand is boosting U.S. refiners but contributing to higher domestic fuel prices.

FOOD POLICY & FOOD INDUSTRY

— Artificial sweeteners may have multi-generational effects, study finds: New research suggests potential inherited metabolic impacts, though findings remain preliminary.

WEATHER

— NWS outlook: Continued storms in the Southeast and Midwest alongside below-average temperatures across much of the central U.S.

— Cold snap and moisture divide shape U.S. planting and crop outlook: Freeze risks, flooding, and Plains dryness are creating sharply divided planting conditions across regions.
 

TOP STORIES—Middle East war: oil, stocks, and U.S. grain markets swing on U.S./Iran deal hopesIran reviews Washington-backed proposal as Trump signals conflict could end — energy, equities, and ag markets now tightly linked A wave of optimism tied to a potential U.S./Iran agreement is rippling across global markets — from crude oil and equities to U.S. grain futures — as investors increasingly trade on the probability of a negotiated end to the conflict rather than current battlefield dynamics. At the center of the shift is Iran’s review of a Washington-backed peace proposal, while President Donald Trump has indicated the war could end quickly if Tehran agrees to terms. That binary outcome — deal or escalation — is now driving cross-asset volatility and shaping expectations across energy, financial, and agricultural markets. Oil remains the primary transmission mechanism. Crude prices have experienced sharp swings, dropping on reports that a deal could be near before stabilizing as uncertainty persists over whether an agreement will materialize. The underlying logic is clear: a deal would likely reopen the Strait of Hormuz, which handles roughly one-fifth of global oil and liquefied natural gas flows, easing supply constraints and removing a significant geopolitical risk premium that has built into prices since the conflict escalated. Equity markets have responded in the opposite direction, rallying on expectations that lower energy prices would ease inflation pressures and stabilize supply chains. Investors have rotated toward sectors most exposed to fuel costs, while the U.S. dollar has softened and Treasury yields have edged lower as the inflation outlook improves under a potential de-escalation scenario. Meanwhile, U.S. grain markets are increasingly tied into this same macro narrative, reacting not just to traditional supply-and-demand fundamentals but to movements in energy and input costs. Corn and soybeans, in particular, are trading in close correlation with crude oil due to their role in ethanol and biodiesel production. When oil surged on war-related supply fears, corn and soybean oil followed higher as biofuel margins strengthened. As oil has pulled back on hopes of a peace agreement, those same grain markets have shown signs of softening, reflecting weaker expected demand from the energy sector. Meanwhile, fertilizer remains a critical structural driver underpinning agricultural markets. The conflict has disrupted global nutrient flows and shipping routes, pushing fertilizer costs higher and raising production expenses for crops such as corn and wheat. Those elevated input costs have helped support grain prices even amid broader market volatility. A successful agreement between Washington and Tehran would likely ease pressure on fertilizer markets by normalizing energy and transport flows, removing an important source of price support for grains. Geopolitical risk continues to play a role as well. Grain markets, particularly wheat, have carried a premium tied to ongoing instability, supply chain disruptions, and shifting global trade flows. That premium has drawn investor interest in agricultural commodities as a hedge against broader uncertainty, reinforcing price strength during periods of heightened tension. The result is a market environment driven by conditional outcomes. A finalized U.S./Iran agreement would likely push oil prices lower, extend gains in equities, and begin to weigh on grain markets as both biofuel demand expectations and fertilizer-driven support ease. Conversely, a breakdown in negotiations would likely trigger another leg higher in oil, pressure equities, and provide renewed support for grains through stronger biofuel economics, tighter input supplies, and a resurgence of geopolitical risk. The broader takeaway is that markets are collectively pricing the possibility of a ceasefire, but the implications are not uniform. While equities stand to benefit directly from de-escalation, U.S. grain markets face a more complex adjustment, as the same forces that reduce inflation and stabilize energy markets could begin to erode the underlying support that has sustained agricultural prices since the conflict began. —Gasoline prices diverge sharply across U.S. as West Coast premium widensNational map shows sub-$4 fuel in the South while California and Washington top $5.50 per gallon Regular gasoline prices across the U.S. remain highly fragmented, with a pronounced regional divide between the high-cost West Coast and relatively cheaper Southern states, according to the latest state-by-state data for Wednesday. California continues to lead the nation with an average price of $6.16 per gallon, far outpacing every other state. Washington follows at $5.75, while Oregon ($5.33) and Nevada ($5.23) also remain well above the national midpoint. Alaska is similarly elevated at $5.19. The sustained premium across the West reflects a combination of tighter regional fuel supply, higher refining costs, and stricter fuel specifications. Meanwhile, much of the South and central U.S. is seeing gasoline prices below $4.10 per gallon. Oklahoma posts the lowest price in the country at $3.96, closely followed by Arkansas ($3.97) and Louisiana ($3.99). Texas remains near $4.04, reinforcing the broader trend of lower fuel costs tied to proximity to refining hubs and less stringent fuel requirements. The Midwest presents a more mixed picture. Illinois stands out at $4.99 per gallon, significantly higher than neighboring states such as Iowa ($4.23) and Missouri ($4.12). Michigan and Indiana are both elevated at $4.81, suggesting localized supply or tax dynamics are influencing pricing in parts of the region. On the East Coast, gasoline prices are generally clustered between $4.20 and $4.60 per gallon. Pennsylvania ($4.64) and New York ($4.55) are among the highest in the region, while states like North Carolina ($4.21) and Georgia ($4.05) are closer to the lower end of the spectrum. Florida sits at $4.46, slightly above the regional average. Overall, the national fuel market remains under pressure from uneven supply conditions and lingering disruptions tied to global energy flows, particularly the impact of constrained shipping routes and elevated crude oil volatility. While recent declines in oil prices have offered some relief, the map underscores that regional factors — including infrastructure, environmental regulations, and tax structures — continue to drive significant disparities in what U.S. consumers pay at the pump. —Gasoline price surge threatens consumer spending momentumRising fuel costs squeeze household budgets — with lower-income consumers pulling back the most Higher gasoline prices are increasingly acting as a drag on U.S. consumer spending, raising concerns about broader economic momentum heading into the summer driving season. With fuel prices climbing above $4 per gallon — and recently exceeding $4.50, according to AAA — households are beginning to adjust behavior in ways that signal mounting financial strain. Recent analysis from the Federal Reserve Bank of New York shows that household spending on gasoline surged more than 15% in March. Meanwhile, inflation-adjusted overall consumption declined by 3%, suggesting that rising fuel costs are crowding out other categories of spending. The shift marks a notable turning point after months in which consumers absorbed higher gas prices by drawing down savings and benefiting from elevated tax refunds. The burden is falling unevenly across income groups. Households earning less than $40,000 annually experienced a 12% increase in gasoline spending in March but responded with a sharp 7% reduction in fuel consumption — the largest cutback among all income brackets. This indicates that lower-income consumers are being forced to reduce mobility or discretionary travel to manage rising costs. Middle-income households, earning between $40,000 and $125,000, increased gasoline spending by nearly 15% while trimming consumption by a more modest 4.8%. Higher-income households showed the least sensitivity, with those earning above $125,000 increasing gasoline spending by nearly 19% and making minimal reductions in usage. The broader implication is a growing divergence in consumer resilience. Lower-income households — already more exposed to inflation — are now facing intensified pressure, which could deepen economic inequality while dampening aggregate demand. Meanwhile, early signals from the corporate sector suggest the strain is spreading beyond fuel. Whirlpool Corporation recently slashed its full-year earnings outlook, citing weakening consumer confidence and reduced appetite for big-ticket purchases. Company executives pointed to the combined impact of the ongoing geopolitical conflict and affordability concerns as key drivers behind the pullback. Looking ahead, gasoline futures markets imply prices could remain elevated through the summer. If sustained, higher fuel costs risk further eroding discretionary spending, particularly in categories like durable goods, travel, and dining. The trajectory of gasoline prices — closely tied to developments in the Middle East and the status of the Strait of Hormuz — will remain a critical variable for both consumers and policymakers in the months ahead. New government data shows U.S. airlines spent 56% more on jet fuel in March as the Iran war crippled supply and sent prices soaring. In total, domestic airlines shelled out more than $5 billion on fuel in the month. —Trump hosts Brazil’s Lula at White House for high-level talksBilateral meeting set to focus on trade, energy, and geopolitical alignment amid shifting global dynamics President Donald Trump is scheduled to welcome Brazil’s President Luiz Inácio Lula da Silva to the White House at 11:00 a.m. ET Thursday, followed by a formal bilateral meeting at 11:15 a.m., according to the official White House schedule. The meeting comes at a critical juncture for both nations, as Washington and Brasília navigate a complex global backdrop shaped by trade realignment, energy market volatility, and geopolitical tensions tied to the Middle East conflict and broader supply chain disruptions. The engagement signals a renewed effort to strengthen U.S./Brazil ties, particularly across agriculture, energy, and critical minerals — sectors where both countries hold strategic leverage. For U.S. agriculture, the talks carry added weight given Brazil’s position as a top competitor in global soybean, corn, and meat exports. Any movement toward closer coordination — or conversely, emerging trade friction — could directly influence global grain flows and pricing dynamics, especially as markets remain sensitive to tariff risks and retaliatory actions involving major buyers like China. Meanwhile, energy cooperation is also likely to feature prominently. Brazil’s expanding role in biofuels and offshore oil production intersects with U.S. policy priorities on fuel standards and supply security, particularly as volatility tied to the Strait of Hormuz continues to ripple through global energy markets. Brazil’s beef sector is urging President Lula to push for changes to U.S. import quotas on Brazilian beef during his meetings with President Donald Trump this week, as exporters seek expanded access to the American market.The appeal comes from the Brazilian Association of Meat Exporting Industries (ABIEC), which argues that the current tariff-rate quota system constrains Brazil’s competitiveness. Under existing rules, Brazil shares a roughly 50,000-tonne quota with other suppliers at a lower tariff rate, while shipments above that level are subject to a steep 26.4% duty, according to the group. Despite those limitations, Brazilian exports to the U.S. have been climbing amid tight American cattle supplies. ABIEC President Roberto Perosa said the annual quota was fully exhausted within the first month of the year, forcing additional shipments to face higher tariffs. Industry leaders are now calling for either a country-specific quota allocation or an expansion of the current cap. Perosa contends that greater access would serve both markets, with U.S. beef prices elevated and Brazil well-positioned to help meet demand. Meanwhile, the optics of the meeting underscore a broader diplomatic balancing act. Lula has maintained ties with China and other BRICS nations, while the Trump administration continues to push for stronger alignment among Western Hemisphere partners on trade and security priorities. Thursday’s discussions may offer clearer signals on whether the two leaders can bridge those differences and advance a more coordinated economic agenda. —USDA signals imminent foreign land rule overhaul, weighs fertilizer tariff decisionPolitico — Agency moves to modernize foreign investment disclosures while Trump administration debates Moroccan fertilizer duties amid price pressures USDA is preparing to roll out a proposed rule to overhaul how foreign ownership of American farmland is tracked, according to remarks from Deputy Secretary Stephen Vaden reported by Politico. Speaking during the Ag & Food Law Policy Briefing hosted jointly by the National Agricultural Law Center and NASDA Foundation,Vaden said the rule — expected within “the next several weeks” — will modernize implementation of the Agricultural Foreign Investment Disclosure Act, which requires foreign entities to report acquisitions and transfers of U.S. agricultural land. Vaden emphasized that USDA aims to transition toward “modernized, computerized” reporting systems, signaling a shift away from outdated processes and incorporating feedback gathered during the agency’s earlier advance notice phase. He indicated that stakeholder input will be clearly reflected in the proposed rule once it is published in the Federal Register, underscoring a broader push for transparency and data standardization in tracking foreign investment in farmland. Of note: Vaden also pointed to ongoing high-level discussions within the Trump administration over whether to proceed with the sunset review of countervailing duties on Moroccan fertilizer imports — a decision carrying significant implications for input costs across U.S. agriculture. He said a determination is expected in the “not too distant future.” The rule has not gone to OMB as of yet or at least their review was not completed in the last 30 days. It is not showing on the review list. The debate comes as farm groups and lawmakers continue pressing for relief from the duties, particularly as the Iran conflict has driven fertilizer prices sharply higher. Jerry Moran (R-Kan.) has been among those advocating for tariff reductions, arguing that easing restrictions on Moroccan imports could help stabilize supply and lower costs for U.S. producers already facing elevated input expenses. —Historic drought deepens as farm bill debate intensifiesWidespread dryness raises production risks, strains water systems, and heightens policy urgency in Washington As Congress weighed a new farm bill, April 2026 emerged as the third-worst drought month in U.S. history, trailing only July and August 1934 at the height of the Dust Bowl. Data from the U.S. Drought Monitor show more than 61 percent of the contiguous U.S. is now in moderate to exceptional drought, spanning nearly the entire Southeast and roughly two-thirds of the West.  The breadth and intensity of the dryness are creating mounting challenges for agriculture and rural infrastructure. Soil moisture deficits are worsening across key growing regions, complicating planting progress and early crop development for corn, soybeans, and cotton. In the Hard Red Winter wheat belt, already stressed conditions are raising concerns about yield potential heading into harvest. Meanwhile, livestock producers are facing deteriorating pasture conditions and rising feed costs as forage availability declines. Florida stands out as a focal point of extreme conditions, with 99% of the state in drought and 80% classified in extreme drought — its worst episode of the 21st century. Water management districts are increasingly under pressure to balance urban demand with agricultural needs, while reservoir and aquifer levels continue to drop. Beyond agriculture, the drought is amplifying wildfire risk across multiple regions, particularly in the Southeast and parts of the West where dry vegetation and above-normal temperatures are converging. Emergency management officials are warning that the early-season fire environment could intensify further if precipitation deficits persist into the summer months. The scale of the drought is also feeding directly into the policy debate in Washington. Lawmakers crafting the farm bill are facing renewed pressure to strengthen crop insurance programs, disaster assistance frameworks, and conservation incentives aimed at improving long-term resilience. Meanwhile, the broader macroeconomic implications — including potential impacts on food prices and rural economic stability — are increasingly part of the legislative calculus as conditions continue to deteriorate. —Diesel price spike ripples through agriculture and rural economyPolitico: Rising fuel costs threaten farm margins, grain logistics, and rural inflation ahead of harvest A sharp rise in diesel prices is emerging as a critical pressure point for U.S. agriculture, with implications spanning input costs, grain movement, and broader rural inflation, according to reporting from Politico. Diesel — the backbone fuel for farm machinery, trucking, and rail — is nearing record highs, with national averages approaching $5.82 per gallon. While many farmers locked in fuel purchases for spring planting, the downstream impacts are now building, particularly in transportation and post-harvest logistics.  The most immediate agricultural risk lies in grain hauling. Freight costs are rising quickly, squeezing margins for producers who depend on trucking networks to move corn, soybeans, and wheat from farm to elevator and export channels. In key production states like Iowa, local political and farm leaders note that while current impacts are manageable, a prolonged price spike into the fall harvest window would materially increase financial strain across the farm economy. Meanwhile, diesel-driven inflation is structurally more persistent than gasoline, as transportation firms typically operate under longer-term fuel contracts. This means elevated costs will be embedded in supply chains for months, raising expenses not only for moving crops but also for inputs such as fertilizer, seed, and equipment. The trucking sector — essential for agricultural distribution — is already showing signs of stress. A significant share of independent operators have reduced activity or parked trucks entirely due to unprofitable fuel costs, tightening freight capacity just as seasonal demand typically increases. That dynamic could create bottlenecks during peak harvest movement, amplifying basis volatility and regional price dislocations. At the macro level, the diesel spike — driven largely by the Iran war and the closure of the Strait of Hormuz — reinforces broader inflation risks across food systems. Since diesel touches every stage of the agricultural value chain, from fieldwork to export terminals, higher fuel costs are expected to filter into food prices, rural construction, and land values over time. Even if geopolitical tensions ease, analysts caution that recovery in fuel markets — and by extension agricultural logistics — will be slow. Inventory rebuilds, supply chain normalization, and freight reactivation could take months, meaning the agricultural sector may face sustained cost pressure well into the next crop cycle.—Trump/Xi summit signals broader strategic bargaining as trade and Iran tensions escalatePre-visit diplomacy highlights Taiwan sensitivities, potential quid pro quo dynamics, and rising EU frustration with China’s trade posture All signs point to President Donald Trump traveling to Beijing next week for a high-stakes meeting with Chinese President Xi Jinping, following a flurry of senior-level diplomatic engagements that suggest both sides are preparing for a consequential round of negotiations. Recent calls between Chinese Foreign Minister Wang Yi and Secretary of State Marco Rubio, as well as between Vice Premier He Lifeng and U.S. officials including Treasury Secretary Scott Bessent and USTR Jamieson Greer, underscore the breadth of issues on the table. Beijing’s readout of the Wang/Rubio call placed unusual emphasis on Taiwan, with Wang warning it remains “the biggest risk” in bilateral relations and urging Washington to “honor its commitments.” China watcher Bill Bishop says notably, the phrasing that the U.S. should act “to open up new space” for cooperation — 打开新的空间 — suggests Beijing may be signaling openness to a broader strategic tradeoff. He says the language implies a potential quid pro quo framework, where de-escalation or clarity on Taiwan policy could unlock cooperation in other domains, including trade, security, or global conflict management. Iran is expected to feature prominently in the discussions, particularly as tensions escalate over enforcement of U.S. sanctions. China’s Ministry of Commerce recently issued a blocking order against U.S. Iran-related oil sanctions targeting five Chinese firms, a direct challenge to U.S. enforcement efforts. Meanwhile, Rubio has threatened secondary sanctions for non-compliance, raising the stakes for Chinese energy imports and complicating any pathway to coordination. With the Strait of Hormuz disruptions already reverberating through global energy and fertilizer markets, the Iran file intersects directly with broader economic stability concerns. Meanwhile, Europe appears to be approaching an inflection point in its own relationship with Beijing. Frustration is mounting within the bloc over what officials see as an unsustainable trade imbalance and ineffective defensive tools. While existing anti-dumping and anti-subsidy measures have targeted select sectors, they have failed to address the scale of Chinese imports. New legislative responses — including the proposed Industrial Accelerator Act and Cybersecurity Act — remain at least a year away from implementation, leaving the EU exposed in the near term. European officials are increasingly signaling that, absent meaningful change from Beijing, a broader trade confrontation may be unavoidable. However, the bloc faces a fundamental constraint: any aggressive response risks short-term economic pain, raising doubts about whether Brussels can act with the coherence and force required to counter China’s trade practices. Taken together, Bishop concludes, the upcoming Trump/Xi meeting is shaping up as more than a routine diplomatic engagement. It represents a potential pivot point where Taiwan, Iran, and global trade tensions converge — with implications not just for bilateral ties, but for the broader geopolitical and economic landscape. —Daines thanks China for Iran diplomacy, pushes Boeing sales ahead of Trump/Xi summitMontana Republican credits Beijing’s role in easing Hormuz tensions while urging deeper trade engagement as high-stakes U.S./China talks approach Sen. Steve Daines (R-Mont.) publicly thanked China for its diplomatic outreach to Iran, crediting Beijing’s efforts to help reopen the Strait of Hormuz as Washington looks for an off-ramp to a nine-week conflict that has disrupted global energy markets.  During a meeting in Beijing with Chinese Foreign Minister Wang Yi, Daines praised China’s engagement with Tehran, specifically referencing recent talks with Iran’s foreign minister. He said Beijing’s efforts to de-escalate tensions and restore shipping flows through Hormuz were critical to stabilizing the Middle East and global oil supply chains. Daines, a member of the Senate Foreign Relations Committee, is leading a bipartisan congressional delegation through China this week, with stops in Shanghai and Beijing focused on economic ties and geopolitical coordination. His comments come as both Washington and Beijing seek to manage escalating risks tied to the Iran conflict while preserving broader bilateral stability. Meanwhile, Daines used the meeting to press for expanded Chinese purchases of Boeing aircraft, signaling that commercial diplomacy remains a key pillar of U.S.–China engagement. He suggested that additional orders could emerge when Donald Trump meets Xi Jinping in Beijing next week — a summit that had previously been delayed due to the Iran war. Chinese officials struck a cautious tone, with Wang noting that relations between the world’s two largest economies have experienced “twists and turns,” but have recently stabilized through direct engagement between the two leaders. The upcoming Trump/Xi meeting is expected to address not only Iran but also ongoing disputes over sanctions, trade barriers, and industrial policy. Daines brings a unique background to the talks, having worked in China and Hong Kong during the 1990s as an executive with Procter & Gamble. He also played an informal intermediary role during the 2019 trade war, meeting with senior Chinese officials including former top negotiator Liu He. The current delegation underscores renewed congressional interest in direct engagement with Beijing after a sharp decline in visits during the pandemic years. Daines noted that lawmaker travel to China has dropped significantly since 2020, compared with the steady flow of delegations in the prior decade. Joining Daines on the trip are Sens. Maria Cantwell (D-Wash.), Deb Fischer (R-Neb.), Mike Lee (R-Utah), and Jerry Moran (R-Kan.), reflecting a bipartisan effort to stabilize relations at a moment of heightened geopolitical and economic strain. —Cotton trade emerges as secondary focus ahead of Trump/Xi Beijing summitIndustry pushes for inclusion as broader agricultural purchases expected to anchor trade discussions U.S. cotton is not expected to headline the May 14-15 summit between President Donald Trump and Chinese President Xi Jinping in Beijing, but it is increasingly being positioned as part of the broader agricultural trade conversation likely to unfold alongside higher-profile geopolitical and economic issues.Preparations for the summit have centered on Taiwan, Iran, tariffs, and supply chain concerns, with both sides signaling interest in stabilizing the bilateral relationship. Within that framework, agriculture remains one of the most viable areas for near-term cooperation, echoing earlier phases of U.S./China trade diplomacy where commodity purchases were used to ease tensions.  Trump is expected to push for trade concessions from Beijing as the November midterm elections approach. Both sides are developing a “Board of Trade” framework designed to identify products that can expand bilateral commerce without undermining national security or disrupting critical supply chains. Under the proposals, China could increase purchases of U.S. poultry, beef, and non-soybean crops, including corn and sorghum, alongside a pledge to buy 25 million metric tons of soybeans annually over the next three years. Meanwhile, Washington is also seeking commitments for Chinese purchases of Boeing aircraft as well as U.S. coal, oil, and natural gas. However, U.S. cotton is gaining attention behind the scenes as industry groups press the Trump administration to ensure the fiber is included in any renewed Chinese buying commitments. The National Cotton Council has urged negotiators to secure meaningful access, pointing to a sharp decline in U.S. cotton shipments to China in recent years. That drop underscores the stakes for U.S. producers. China has historically been one of the largest export destinations for American cotton, and any normalization in trade flows could provide a meaningful boost to demand at a time when global textile markets remain uneven. Meanwhile, Beijing continues to rely on imported cotton to supplement domestic supply, particularly for its large textile manufacturing base. The structure of the summit discussions also makes cotton a natural candidate for inclusion. Agricultural purchases offer a politically viable pathway for both governments to demonstrate progress without making immediate concessions on more contentious structural issues. The Trump administration has consistently viewed farm exports as a stabilizing lever in trade negotiations, while Chinese officials have historically used commodity buying to signal goodwill and manage diplomatic friction. Of note: There is no indication that cotton will be addressed as a standalone issue or that specific purchase targets have been agreed to ahead of the meeting. Instead, it is more likely to be folded into a broader package of agricultural goods should the two sides move toward a renewed trade understanding. The outcome of the summit will ultimately determine whether cotton reemerges as a meaningful component of U.S./China trade flows or remains overshadowed by the larger geopolitical and economic priorities shaping the relationship. —EU struggles to finalize U.S. trade pact as tariff threats intensifyTrump administration pressures Brussels with looming auto tariff hikes amid stalled ratification process The European Union failed to finalize a long-anticipated trade agreement with the United States during overnight negotiations, underscoring deep divisions within the bloc and raising the risk of renewed tariff escalation from President Donald Trump’s administration, according to Bloomberg Government. Talks involving European Parliament negotiators and member states ended without a breakthrough, with Cyprus — currently holding the EU’s rotating presidency — confirming that no conclusive decisions were reached. Officials signaled that discussions will continue in the coming weeks, though the lack of progress comes at a sensitive moment in transatlantic trade relations. The Trump administration has intensified pressure on Brussels to move more quickly. President Donald Trump warned last week that the U.S. could raise tariffs on EU autos and trucks to 25% from the current 15% level, arguing that the EU has failed to follow through on commitments made under the preliminary agreement reached last July. That original accord envisioned the EU eliminating tariffs on U.S. industrial goods in exchange for a capped 15% tariff rate on most EU exports, including automobiles. While Washington has already taken steps to implement portions of the deal, EU ratification has been slowed by internal legislative procedures and political disagreements among member states. Meanwhile, U.S. Ambassador to the EU Andrew Puzder reinforced the administration’s position, warning that higher auto tariffs could come “relatively soon” if meaningful progress is not achieved. His comments highlight the growing impatience within the administration and suggest that trade tensions could escalate quickly absent a near-term breakthrough. The impasse reflects broader structural challenges in EU decision-making, where consensus among multiple governments and parliamentary bodies often delays implementation timelines. Meanwhile, the Trump administration’s willingness to leverage tariffs as a negotiating tool continues to inject volatility into the transatlantic economic relationship, with autos once again at the center of the dispute.

—Equities today: Global markets traded mixed in cautious dealings as investors weighed the prospects of a potential U.S./Iran peace agreement, while uncertainty continued to surround the status of the critical Strait of Hormuz. Wall Street futures were little changed after the S&P 500 and Nasdaq finished at fresh record highs in the previous session.

In Asia, Japan +5.6%. Hong Kong +1.6%. China +0.5%. India -0.2%. The Hang Seng Index reached its highest level in over two months. In mainland China, markets showed resilience as they fully reopened after the holiday. Japan returned from its extended spring holidays and the Nikkei 225 roared nearly 6% higher on the opening day of trading.

In Europe, at midday, London -0.7%. Paris -0.2%. Frankfurt -0.3%.

Earnings results today include McDonald’s, Airbnb, Datadog, Texas Roadhouse, Planet Fitness, The RealReal, and TripAdvisor.

—Equities yesterday: The S&P 500 hit a new all-time high and closed above 7,300 for the first time.The Dow joined the Nasdaq and S&P 500 in exiting correction territory. Though the Dow failed to close above 50,000 — something it hasn’t done since Feb. 11 — it did finish 10% higher than its lowest point after entering a correction in March.

—Yuan strength tests China’s export engine

Currency appreciation advances Beijing’s global ambitions while squeezing exporter margins

China’s push to elevate the yuan on the global stage is gaining traction, but the currency’s rapid appreciation is beginning to test the resilience of the country’s export sector.

The People’s Bank of China has set the yuan at its strongest level against the U.S. dollar in more than three years, reflecting both policy intent and shifting global sentiment. The currency’s rise comes amid weakening confidence in dollar-denominated assets and improving market optimism tied to potential de-escalation in the Middle East, particularly around U.S.–Iran tensions.

Analysts expect the yuan to strengthen further — potentially reaching 6.65 per dollar by year-end — aligning with Beijing’s broader goals of boosting domestic consumption and expanding the yuan’s role in global trade. This trend also intersects with rising discussions of “de-dollarization,” as countries explore alternatives to the U.S. dollar for cross-border transactions.

Meanwhile, the currency’s strength is creating headwinds for exporters. A stronger yuan raises the cost of Chinese goods abroad and has already led to notable foreign exchange losses among major firms, including automaker BYD and industrial producers. These pressures are forcing companies to step up hedging strategies and rethink currency exposure.

Still, China’s export sector has shown surprising durability, with shipments rising nearly 12% year-over-year in the first quarter. Analysts suggest that technological competitiveness — rather than price alone — is increasingly driving export performance, helping offset currency-related disadvantages.

Looking ahead, the yuan’s trajectory could become a focal point in upcoming talks between Donald Trump and Xi Jinping, where currency policy and trade imbalances are expected to feature prominently.

—Kalshi lands $1 billion as prediction markets surge

DealBook (NYT) reports the fast-growing platform is doubling down on institutional adoption amid rapid volume expansion and ongoing regulatory scrutiny.

According to DealBook (NYT), Kalshi has raised $1 billion in a new funding round that values the prediction market platform at $22 billion, underscoring the explosive growth of a sector attracting millions of users betting on everything from sports to weather outcomes. The round was led by Coatue Management, with participation from Sequoia Capital, Andreessen Horowitz, IVP, Paradigm, Morgan Stanley, and ARK Invest.

The new valuation marks a sharp acceleration, doubling from Kalshi’s December raise, which itself more than doubled the company’s valuation from October. That trajectory reflects surging activity on the platform. Kalshi said its annualized trading volume has reached $178 billion — more than tripling in just six months — while annualized revenue has surpassed $1.5 billion. The company now reports roughly two million monthly users, highlighting the speed at which prediction markets are scaling. “Literally, outside of AI you don’t see anything growing like that,” Coatue’s Lucas Swisher told DealBook, pointing to the platform’s rapid adoption curve.

Kalshi is increasingly focused on attracting institutional participants, including brokerages and hedge funds, as it seeks to deepen liquidity and improve pricing efficiency across its markets. Chief executive Tarek Mansour said that broader institutional involvement would help make outcomes more accurately priced. The company recently executed its first custom block trade — a privately negotiated transaction between institutions — and reported that institutional trading volume has surged 800% over the past six months.

Competition is intensifying as rivals pursue similar strategies. Polymarket, a key competitor, has also raised capital — including backing from Intercontinental Exchange, the parent of the New York Stock Exchange — though it continues to face challenges launching a fully regulated U.S. platform.

Meanwhile, regulatory and legal scrutiny remains a central issue for the sector. Several states have accused Kalshi of circumventing sports betting laws, and the industry has faced criticism over alleged insider trading tied to sensitive geopolitical or military developments. However, Mansour pointed to a recent legal victory in which a federal judge permanently blocked Arizona from prosecuting the company over alleged gambling violations. Swisher added that Kalshi has taken steps to enforce rules against insider trading, arguing that strong compliance is critical to attracting institutional capital.

The combination of rapid growth, institutional ambition, and unresolved regulatory questions positions prediction markets as one of the fastest-evolving — and most closely watched — segments in financial markets today.

—McDonald’s flags ‘challenging’ consumer environment despite earnings beat

Traffic pressures and cost sensitivity shape fast-food strategy as fuel and food inflation bite

McDonald’s signaled mounting pressure on consumer spending in its latest earnings report, with CEO Chris Kempczinski describing the current operating environment as “challenging” even as the company exceeded Wall Street expectations on revenue and profit.

U.S. same-store sales rose 3.9% in the first quarter, falling short of the anticipated 4.2% gain, underscoring softer traffic trends as households adjust to higher gasoline and food costs. The miss highlights a growing sensitivity among consumers — particularly lower- and middle-income segments — who are increasingly pulling back on discretionary spending.

Meanwhile, global comparable sales increased 3.8%, also slightly below expectations but representing a notable rebound from a 1% decline in the same period last year. The improvement suggests international markets are stabilizing, though not yet delivering the stronger growth analysts had projected.

To counter softer demand, McDonald’s has leaned heavily on value-focused strategies, including low-priced meal bundles and limited-time promotional offers. These tactics mirror a broader shift across the food service sector, where companies are prioritizing affordability and promotional traffic drivers to maintain customer volumes.

Of note: The company reported impacts from beef prices, signaling high beef costs remain a significant pressure point, as wholesale beef prices have risen roughly 48% over the past 12 months.

The company’s results reflect a broader macroeconomic theme: rising fuel prices and persistent food inflation are reshaping consumer behavior, forcing even dominant quick-service brands to compete more aggressively on price while protecting margins.

—Beyond Meat struggles persist as demand softens and revenue outlook disappoints

Consumer pushback on pricing and weak category momentum weigh on growth strategy

Beyond Meat continues to face mounting headwinds as sluggish demand for plant-based alternatives pressures both revenue and its broader growth strategy. The company’s first-quarter results underscored ongoing challenges in regaining momentum, particularly as consumers remain resistant to the relatively high prices of meat substitutes.

First-quarter revenue came in at $58.2 million, a decline from $68.7 million a year earlier and only marginally above expectations. Meanwhile, the company’s forward guidance disappointed, with projected quarterly revenue in the range of $60 million to $65 million — signaling limited near-term recovery in demand.

Despite the softer top-line performance, the company narrowed its losses, reporting an adjusted loss of 10 cents per share compared to a significantly larger 77-cent loss in the prior year. The improvement suggests cost-cutting and operational adjustments are gaining traction, even as revenue growth remains elusive.

CEO Ethan Brown pointed to a strategic pivot, highlighting an expanded focus beyond traditional plant-based meat into the “functional food and beverage” category — an area seen as offering stronger growth potential. The move reflects an effort to reposition the brand amid a broader cooling in the plant-based protein segment.

Meanwhile, the core issue remains demand elasticity. Consumers, particularly in a high-inflation environment, have shown increasing reluctance to pay premium prices for plant-based alternatives, especially as conventional meat prices stabilize. That dynamic continues to challenge not only Beyond Meat but the broader alternative protein industry, raising questions about long-term adoption rates and pricing power.

The combination of weak demand, cautious guidance, and a strategic pivot underscores a company still searching for a sustainable growth path in a maturing — and increasingly competitive — plant-based market.

—U.S. export sales activity to China still mostly shifting sales from unknown destinations. USDA weekly Export Sales data for the week ended April 30 showed 2025/26 activity for China including net sales of 64,337 MT of sorghum (4,337 MT new sales), 66,899 MT of soybeans (4,130 MT new sales), and 4,399 running bales of upland cotton (new sales of 7 running bales). For 2026, net sales of 1,081 MT of pork (1,146 MT new sales) were reported. With accumulated soybean exports of 10.598 MMT and total commitments of 11.8 MMT, there are 1.204 MMT of sales outstanding.

—Global grain markets ease as Black Sea outlook improves

Paris wheat, Russian export values and Asian feed markets weaken amid hopes for renewed Strait of Hormuz access and improving global supply expectations

International grain and oilseed markets traded lower overnight as easing geopolitical concerns and improving weather forecasts pressured global crop prices. Paris milling wheat futures on Euronext declined €2.15 per metric ton to €206.25/MT, reflecting broader weakness across the wheat complex as traders monitored developments tied to Iran and the Strait of Hormuz.

Russian FOB wheat values were also softer, slipping another $1/MT to $236/MT as Black Sea export competition remained aggressive. Russian exporters continue to dominate several international destinations, aided by comparatively cheaper pricing and abundant supplies.

In Asia, China’s Dalian grain and oilseed markets moved lower overnight. Dalian July corn futures fell the equivalent of 11 cents to approximately $8.80 per bushel, while Dalian July soybean meal futures dropped $3.90/MT to $412.80/MT. Malaysian palm oil futures also weakened, with July palm oil contracts declining 40 ringgit to 4,507 ringgit per metric ton as energy markets and vegetable oil values softened globally.

The weakness across world grain and vegetable oil markets came as traders increasingly priced in the possibility of reduced geopolitical risk premiums should negotiations involving Iran advance in the coming days. Lower crude oil prices also pressured soybean oil and broader biofuel-linked markets overnight.

Meanwhile, global wheat supply expectations remain relatively comfortable despite ongoing weather concerns in parts of the U.S. Plains. Market participants continue to monitor crop conditions across major Northern Hemisphere producers, though the absence of widespread heat threats has helped cap upside momentum in international wheat markets.

—Overnight U.S. grain markets: Grain futures weaker at electronic close; wheat leads downside pressure

Bias: Bearish — wheat sharply lower; soy complex and corn under pressure

Grain futures closed weaker at the 8:45 a.m. ET end of overnight electronic trading on the Chicago Mercantile Exchange, with wheat futures posting the largest losses while soybeans and corn also traded lower.

Prices: July corn closed at $4.62 3/4, down 5 3/4 cents. July soybeans settled at $11.85 3/4, down 9 cents. July soybean meal closed at $319.50 per ton, up $2.20, while July soybean oil fell 117 points to 73.85 cents per pound. In the wheat complex, July Chicago SRW wheat closed at $6.10 3/4, down 6 1/2 cents, while July Kansas City HRW wheat dropped 13 3/4 cents to $6.73 1/2.

Selling pressure in wheat futures accelerated overnight amid favorable Northern Hemisphere production expectations and continued stiff competition from Black Sea supplies. Corn and soybean futures also weakened on broad commodity pressure and generally favorable U.S. weather forecasts, though soybean meal futures managed modest gains on short covering and product spread positioning.

With the weekly USDA export sales report now behind the market, trader attention is increasingly shifting toward the May 12 WASDE report expectations and evolving U.S. weather patterns across the Corn Belt and Plains.

In outside markets, the U.S. dollar index was firmer while crude oil prices moved lower, adding pressure to the broader commodity sector.

—Indonesia eyes rare rice export to Malaysia as supplies swell

State stockpiles surge past 5 MMT, signaling a shift from import reliance to regional supplier

Indonesia is in active negotiations to export 200,000 metric tons of rice to Malaysia, according to local media reports citing Bulog chief executive Ahmad Rizal Ramdhani. Pricing for the potential deal remains under discussion, but the talks mark a notable development in Southeast Asian grain flows.

The proposed shipment reflects a broader shift in Indonesia’s rice balance sheet. Bulog, the state logistics agency, is currently holding roughly 5.2 million metric tons of rice stocks — a level high enough to support outbound trade. Historically, Indonesia has been a periodic importer to stabilize domestic supplies, making this potential export a significant reversal.

The change is being driven by stronger domestic production, which has boosted inventories and opened the door for limited exports. If finalized, the deal would position Indonesia as a short-term regional supplier, particularly to nearby deficit markets like Malaysia, and could modestly ease tightness in Southeast Asian rice trade flows.

—U.S. meat exports show diverging trends as pork surges and beef adjusts to China absence

Strong Western Hemisphere demand powers pork, while beef value holds firm on variety meats

March U.S. meat export data from USDA and U.S. Meat Export Federation showed a powerful first quarter for pork, contrasted with softer beef volumes due largely to China’s continued absence — though strong pricing and record variety meat demand helped stabilize overall beef export value.

Pork exports delivered one of their strongest performances on record in March, totaling 285,567 metric tons, up 6% year over year and the third-largest monthly volume ever. Export value climbed 4% to $803.2 million, marking the second highest on record. Growth was broad-based, led by Mexico and supported by gains in Japan, Central America, the Dominican Republic, the Philippines and Taiwan. On a per-head basis, export value reached $72.93 — the third-highest level ever recorded.

The momentum extended through the first quarter, with pork exports rising 3% from a year ago in both volume and value, reaching 778,939 metric tons and $2.17 billion. Shipments to Mexico and Central America continue to run at record pace, reinforcing the Western Hemisphere as the backbone of U.S. pork demand, while a rebound in Japan signals improving Asian market conditions.

Beef exports, meanwhile, reflected ongoing geopolitical headwinds. March shipments totaled 97,731 metric tons, down 11% from a year earlier, with export value falling 8% to $844.7 million. The decline was primarily driven by minimal exports to China, which has effectively been absent from the market for over a year. Additional softness was seen in Japan and the Middle East.

However, outside of China, the picture was more constructive. Excluding China, March beef export volume rose 4% year over year, with value increasing 8%. Strength was concentrated in Mexico, Central and South America, the Caribbean and Indonesia, while shipments held steady to Korea and Taiwan.

A key bright spot for the beef complex was variety meats, which posted record-breaking value. March exports reached 29,062 metric tons, up 24% from a year ago, while value surged 50% to a record $135.6 million. This helped lift total per-head export value for fed cattle to $456.56, underscoring the importance of maximizing carcass utilization amid tight cattle supplies.

For the first quarter, total beef and variety meat exports declined 11% in volume and 7% in value to 275,355 metric tons and $2.35 billion. But excluding China, exports were up 3% in volume and 9% in value — highlighting the industry’s ability to pivot toward alternative markets.

Lamb exports presented a mixed picture. March volumes declined 11% to 247 metric tons, but value edged 4% higher to $1.6 million. First-quarter performance remained solid, with exports up 9% in both volume and value, driven primarily by demand from the Caribbean, along with gains in Central America and select Asian markets.

Overall, the data underscores a bifurcated export environment — robust, geographically diversified demand driving pork to near-record levels, while beef producers navigate the loss of China by leaning on higher-value cuts and expanding variety meat demand to sustain returns.

—Argentina scrambles to protect soy exports after GMO rejections

Unapproved HB4 strain triggers EU concerns, forcing containment efforts and trade diplomacy

Argentina is racing to preserve access to its critical European soy markets after cargoes were rejected due to the presence of an unapproved genetically modified strain, according to reporting from Bloomberg. The issue centers on the HB4 soybean trait — a drought-resistant variety developed by Bioceres Crop Solutions — which is approved domestically and in China but not in the European Union.

The immediate trigger came when the Netherlands rejected Argentine soymeal shipments after detecting traces of HB4. While only one country has acted so far, the Netherlands serves as a key entry point into the broader European Union, raising the risk that additional member states could follow with similar restrictions.

Industry leaders say the response has been swift and highly coordinated. Argentina’s crushing and export sector — represented by Ciara-Cec and major global traders — is implementing strict segregation protocols to prevent contamination. That includes geo-locating all HB4-planted acreage and creating controlled logistics chains to move those beans directly from farm to port without entering shared processing facilities.

The stakes are significant for President Javier Milei. Soy exports are a cornerstone of Argentina’s economy, generating more than $18 billion annually and serving as a key source of foreign currency needed to rebuild central bank reserves and reassure bondholders. Any disruption to European demand — which typically accounts for roughly a quarter of Argentina’s soy meal exports — would ripple across both fiscal stability and global oilseed markets.

Complicating matters further, the dispute is unfolding alongside the provisional rollout of the long-negotiated Mercosur–EU trade agreement, which has already faced political resistance within Europe. The GMO issue risks becoming another flashpoint in an already sensitive agricultural trade relationship.

To mitigate the fallout, Argentina plans to divert HB4 soybeans to markets where the trait is approved, particularly China, while lobbying Brussels to adopt a tolerance threshold for low-level presence of the trait in shipments. However, industry officials acknowledge that achieving “zero contamination” — the EU’s de facto standard — remains a difficult operational challenge during peak harvest.

If European access tightens further, Argentina may be forced to reroute larger volumes to alternative markets in Asia, though likely at discounted prices — a scenario that would weigh on export revenues and global pricing dynamics.

—Agriculture markets yesterday:

—Senate Ag Committee targets fertilizer costs in upcoming hearing

Lawmakers to examine supply constraints, global disruptions, and farmer affordability concerns

The Senate Ag Committee has scheduled a hearing next Tuesday (May 12) afternoon to address persistently high fertilizer prices, as lawmakers intensify scrutiny over input costs weighing on U.S. farmers. The session will focus on supply chain vulnerabilities, pricing dynamics, and policy options to improve affordability and domestic production of key crop nutrients.

Scheduled witnesses include:

• The Fertilizer Institute President and CEO Corey Rosenbusch

• South Dakota Corn Growers Vice President Trent Kubic

• Kentucky Farm Bureau Federation President Eddie Melton

• Market analyst Andy Green, Center Market Strategies (Green was senior adviser for fair and competitive markets in the Biden administration)

• J. Westling & Co. CEO Joshua Westling

The hearing comes at a critical point in the planting season, when elevated prices for nitrogen, phosphate, and potash fertilizers are tightening margins across major row crop operations. Senators are expected to question industry executives, economists, and administration officials on the drivers behind sustained price strength — including global supply disruptions, energy market volatility, and ongoing geopolitical tensions affecting trade flows.

Particular attention is likely to center on the impact of the Middle East conflict and constrained shipping routes, which have disrupted fertilizer exports and driven up input costs worldwide. Lawmakers are also expected to explore concerns around market concentration within the fertilizer industry, with some policymakers raising questions about pricing power among major producers.

Meanwhile, the hearing is expected to examine the Trump administration’s efforts to bolster domestic fertilizer production through permitting reform, potential financial incentives, and the use of tariff revenues to support new capacity. Officials have signaled interest in accelerating project timelines and reducing regulatory barriers, aiming to lessen U.S. dependence on imported nutrients over the longer term.

The session could also touch on broader food security implications, as elevated fertilizer costs ripple through the agricultural supply chain, potentially affecting crop yields, planting decisions, and ultimately consumer food prices. Senators from both parties are expected to emphasize the urgency of stabilizing input markets as farmers navigate a volatile global environment.

—Fertilizer profits surge as war disrupts global supply chains

Nitrogen price spikes and supply bottlenecks drive earnings windfall for major producers

According to Bloomberg, fertilizer giants CF Industries and Nutrien are reporting sharp earnings gains as the Iran war disrupts global supply chains, tightening availability and driving up prices for key crop nutrients. The conflict — particularly the closure of the Strait of Hormuz — has exposed vulnerabilities in fertilizer trade flows, triggering a surge in nitrogen prices and boosting margins for North American producers.

Both CF Industries Holdings Inc. and Nutrien Ltd. posted nearly 20% increases in quarterly sales, reflecting the scale of market disruption. CF’s earnings per share more than doubled year-over-year, while Nutrien’s adjusted earnings surged more than fourfold, even as it missed analyst expectations. The gains underscore how supply shocks are translating directly into profitability for producers positioned outside the most affected trade routes.

At the center of the rally is nitrogen fertilizer, a critical input for U.S. corn and soybean production that cannot be easily substituted or skipped. Prices for nitrogen-based products have risen sharply since late February, when the Strait of Hormuz — a vital corridor for fertilizer and feedstock shipments — became inaccessible. U.S. Gulf granular urea prices have climbed roughly 36% since the conflict began, while prices in Egypt have surged more than 70%, highlighting the global scale of the disruption.

Industry executives point to an already tight market entering 2026, now exacerbated by war-related constraints. CF CEO Chris Bohn emphasized that strong global demand combined with restricted supply has “exposed the fragile nature” of the nitrogen supply chain. Meanwhile, phosphate markets are also tightening, as the strait serves as a key transit route for both finished nutrients and sulfur, a critical input in production.

Meanwhile, a key advantage for U.S.-based producers has emerged on the cost side. Natural gas — the primary input for nitrogen fertilizer production — has remained relatively stable domestically compared to international markets. That dynamic is allowing companies like CF and Nutrien to expand ammonia margins even as global prices rise, reinforcing their competitive edge.

Market analysts expect demand to remain resilient despite elevated prices. Because nitrogen applications are essential for maintaining crop yields, farmers who have delayed purchases are likely to return to the market once supply becomes available. That suggests continued price support — and sustained profitability — for fertilizer producers as long as supply disruptions persist.

—Thursday: Oil pullback and equity strength mask mounting pressure on consumers and aviation sector

Falling crude prices ease market fears, but rising fuel costs continue to strain households and raise inflation risks across key sectors

Oil markets pushed lower as mixed signals from Washington and Tehran underscored the lack of a clear path toward ending the Iran conflict. 

Brent crude slipped under $98 per barrel, extending a recent pullback from war-driven highs.

U.S. WTI crude prices were down another 4% around $91 per barrel. 

The oil mark is increasingly comfortable with short-term volatility but still highly sensitive to geopolitical headlines. Traders appear to be betting that even incremental diplomatic progress could eventually restore some oil flows, though officials on both sides continue to signal that major sticking points remain unresolved.

Meanwhile, new data from the Federal Reserve Bank of New York highlights the uneven economic toll of elevated fuel prices. Lower-income households are bearing the brunt of the surge in gasoline costs, with spending on fuel rising sharply and crowding out other consumption. That dynamic raises broader concerns about consumer resilience, particularly as energy costs ripple through transportation, food, and essential goods.

Within Washington, the focus is shifting beyond gasoline to the aviation sector, where jet fuel prices have surged alongside broader energy markets. President Donald Trump’s advisers are increasingly concerned that sustained increases could pressure airlines, raise ticket prices, and feed into broader inflation measures. The issue is especially acute given the strategic importance of air travel for both business activity and supply chains.

Despite the recent dip in crude prices, underlying supply conditions remain tight. The prolonged disruption in Middle East shipping routes has reduced available inventories and kept risk premiums elevated across energy markets. Even in a scenario where diplomatic progress accelerates, analysts expect a gradual normalization process, with logistical bottlenecks and insurance constraints likely to delay a full recovery in flows.

—Wednesday: Oil prices slide on U.S./Iran deal hopes

Prospect of Hormuz reopening drives sharp selloff despite tight underlying supply

Global oil markets posted a sharp reversal, with Brent crude falling 7.8% to settle at $101.27 per barrel and U.S. West Texas Intermediate (WTI) declining 7.0% to $95.08, as both benchmarks touched two-week lows. The drop was fueled by growing optimism that the United States and Iran are nearing a preliminary agreement centered on a memorandum of understanding, raising expectations that the long-disrupted Strait of Hormuz could soon reopen.

The potential breakthrough shifted market sentiment quickly, with traders pricing in the possibility of restored supply flows through one of the world’s most critical energy corridors. Brent briefly slipped below $100 per barrel for the first time since late April, underscoring how sensitive prices remain to geopolitical developments tied to the waterway.

Meanwhile, negotiations remain incomplete, with officials on both sides signaling that key differences persist and no firm timeline has been established for a finalized deal. Even so, the mere indication of progress has been enough to ease some of the acute supply fears that have driven prices higher since the strait’s closure in late February.

Despite the selloff, underlying fundamentals continue to point to a tight market. The prolonged disruption of flows through Hormuz has significantly curtailed global supply, leading to sustained inventory drawdowns and elevated price levels in recent weeks. U.S. inventory data reinforced that narrative, showing continued declines in crude and refined product stockpiles.

Looking ahead, any recovery in supply is expected to unfold gradually. Even if an agreement is reached, shipping bottlenecks, elevated insurance costs, and logistical constraints are likely to delay a full normalization of flows for several weeks, suggesting that volatility in oil markets will persist as geopolitical developments evolve.

—U.S. fuel exports surge to record as Hormuz disruption reshapes global energy flows

Asian and European buyers turn to American supply, boosting refiners while complicating Trump’s domestic agenda

U.S. fuel exports have surged to record levels as the closure and disruption of the Strait of Hormuz force global buyers — particularly in Asia and Europe — to scramble for alternative supplies. The shift has created a powerful tailwind for American oil companies and refiners, even as it introduces new political and economic risks for President Donald Trump.

The disruption to one of the world’s most critical energy chokepoints — which normally carries a significant share of global oil and refined products — has rerouted trade flows toward the United States. With Middle Eastern exports constrained, buyers have increasingly leaned on U.S. diesel, gasoline, and jet fuel, driving export volumes to historic highs and tightening domestic inventories.

Meanwhile, U.S. refiners are uniquely positioned to capitalize. Access to relatively cheaper North American crude and a sophisticated refining system has allowed them to capture wide margins, effectively turning the geopolitical shock into a commercial windfall.

However, the export boom carries a growing political downside. As more fuel is shipped overseas, U.S. consumers face higher gasoline and diesel prices — a dynamic that complicates the Trump administration’s messaging on energy affordability. Rising domestic fuel costs have already outpaced those in other major economies, underscoring the tension between global market opportunity and domestic political pressure.

The situation reflects a broader structural shift in energy markets triggered by the 2026 Iran conflict. With the Strait of Hormuz intermittently closed or restricted, global supply chains are being reconfigured in real time, with the United States emerging as a central supplier to deficit regions. While highly profitable for U.S. energy companies, the trend risks reinforcing inflationary pressures at home and exposing the administration to criticism that exports are being prioritized over domestic price stability.

—Artificial sweeteners may have multi-generational effects, study finds

Mouse-based research raises new questions about gut health, metabolism, and inherited biological changes

A new study suggests that widely used artificial sweeteners such as sucralose and stevia may trigger biological changes that extend beyond the individual consumer, potentially affecting future generations. Researchers from the University of Chile found that these non-nutritive sweeteners (NNS) altered gut microbiota, gene expression, and metabolism in mice, with some effects persisting in offspring that were never directly exposed.

The study, published in Frontiers in Nutrition, examined mice given doses of sweeteners aligned with U.S. regulatory safety limits. While the original mice showed little change in glucose tolerance, their descendants—particularly those linked to sucralose consumption—displayed mild metabolic alterations that could signal early risks of insulin resistance and related conditions.

Researchers also observed reduced production of short-chain fatty acids, critical by-products of digestion linked to gut health. These reductions persisted across generations, alongside measurable shifts in gut microbiota composition. Such changes may weaken immune function and increase susceptibility to metabolic disorders over time.

At the genetic level, the study identified alterations in key genes tied to immune response and fat metabolism, including Tlr4, Tnf, and Srebp-1. These shifts are believed to occur through epigenetic mechanisms—modifying gene activity without changing DNA sequences—raising the possibility that dietary exposures could have inherited biological consequences.

Despite the findings, researchers emphasized caution in interpreting the results. The study was conducted in mice, and current food safety standards still consider artificial sweeteners safe for human consumption. Still, the results underscore the need for further research into the long-term and transgenerational impacts of these widely used sugar substitutes.

— NWS outlook: Heavy rain and thunderstorms to persist across the Southeast and Lower Mississippi Valley through the end of the week… …A new frontal system, originating from the Northern Rockies, will bring showers and thunderstorms through the Midwest and Great Lakes before

reaching the Northeast… …Temperatures to remain below average across much of the central U.S., while the Northwest continues to moderate.

—Cold snap and moisture divide shape U.S. planting and crop outlook

Freeze risk in Corn Belt, flooding in Mid-South, and expanding Plains dryness create diverging conditions

An unusually cold weather pattern is gripping much of the United States in the near term, with severe frost advisories and freeze warnings stretching across large portions of the northern Corn Belt as temperatures plunged into the mid-20s. This early-season cold stress is raising concerns for recently planted crops, particularly as another round of below-normal temperatures is expected east of the Mississippi River in the 6–10-day window.

Despite the cold, planting progress remains resilient in key producing regions. Across the western and northwestern Corn Belt and into the northern Plains, favorable soil moisture and a lack of significant precipitation are allowing producers to maintain an aggressive planting pace. Field conditions in these areas remain workable, helping offset the risks posed by the colder temperatures.

Meanwhile, conditions are sharply different in the southeastern Corn Belt and Mid-South, where excessive rainfall has effectively halted fieldwork. Saturated soils from recent precipitation are expected to worsen with another round of rain late this week into the weekend, eliminating any meaningful opportunity for drying and delaying planting further.

In the hard red winter wheat belt, the growing season has moved past the threat of sub-freezing temperatures, removing a key risk for the crop. However, wheat conditions are being challenged by persistent dryness, with precipitation totals running at less than half of normal levels over the 1–10-day period. This moisture deficit is beginning to stress developing wheat stands despite isolated weekend showers.

Dryness concerns are also intensifying across the northern Plains, where topsoil conditions are deteriorating rapidly under a sustained lack of rainfall. If the pattern continues, producers in the region are likely to raise more urgent concerns about soil moisture shortages.

Looking ahead, a shift in the broader weather pattern is expected. Warmer temperatures are forecast to spread across the Plains by early next week, initiating a more moderate national trend. The 11–15-day outlook also points to increasing storm activity in the western Corn Belt, which could begin to alleviate dryness in some areas while potentially slowing fieldwork if precipitation becomes excessive.