U.S./Iran Air War Pauses, But Hormuz Keeps Fuse Lit
HF Sinclair sues EPA over stalled biofuel waivers as Sept. 1 compliance clock ticks
| LINKS |
Link: Funds Swing Toward Ag Longs as Shorts Retreat
Link: Booklet: The Leverage Doctrine: How Washington Rebuilt Its Tariff Wall —
and Put Agriculture on Both Sides of It
Link: USDA Cracks Open the Cattle Border: Douglas, Ariz., Port Set to Reopen Aug. 24
Link: WSJ: USDA to Reopen Border to Mexican Cattle, Betting Screwworm
Defenses Will Hold
Link: Herd Hits Bottom, Rebuild on Hold: July Cattle Reports Show a Cycle Turning
in Slow Motion
| Updates: Policy/News/Markets, July 26, 2026 |
| UP FRONT |
TOP STORIES
— U.S./Iran air war pauses, but Hormuz keeps the fuse lit: A second night without direct strikes and progress in Oman-mediated talks offer a possible off-ramp, but the U.S. blockade, Iranian vessel stops and Houthi attacks keep shipping and oil risks elevated.
— HF Sinclair sues EPA over stalled biofuel waivers as Sept. 1 compliance clock ticks: The refiner is pressing EPA to rule before RIN credits expire, with the outcome likely to move biofuel-credit markets and intensify the congressional fight over year-round E15.
— Russia locks in gasoline export ban through year-end, dangles diesel relief — but only on its own terms: Moscow will continue its gasoline export ban through 2026 and ease diesel restrictions only after domestic supplies recover, prolonging uncertainty over global distillate and farm-fuel costs.
FINANCIAL MARKETS
— Equities Friday and weekly change: U.S. equities finished mixed as investors rotated out of richly valued AI and semiconductor shares; the Dow and S&P 500 edged higher Friday, while the Nasdaq fell and all three posted weekly losses.
— Week ahead: Fed, big tech earnings and Iran risk collide in markets’ biggest week of the summer: The Fed decision, GDP, PCE inflation and mega-cap technology earnings arrive amid Gulf energy risks, putting inflation, yields and AI spending guidance at center stage.
AG MARKETS
— Brazil set to cede No. 2 corn export rank to Argentina: Brazilian exports are still forecast to rise to 43 million metric tons, but weaker Iranian demand and surging domestic ethanol use should leave Argentina narrowly ahead.
— Ag markets, Fri., July 24: Soybeans power to contract highs as grains extend weather rally; cattle bulls stir as big USDA reports land: Hotter, drier forecasts lifted soybeans and corn, wheat reversed from contract highs, and cattle traders face USDA supply data plus the phased reopening of Mexican cattle imports.
ENERGY MARKETS & POLICY
— Friday: Oil retreats on diplomacy hopes, but supply risks remain elevated: Brent and WTI fell on renewed peace-talk hopes but posted strong weekly gains as Hormuz and Red Sea shipping disruptions preserved a substantial geopolitical premium.
POLITICS & ELECTIONS
— Brown’s Ohio comeback tests Democrats’ working-class brand: Sherrod Brown’s Senate bid will test whether his labor-focused economic populism can reconnect Democrats with rural and working-class voters despite Ohio’s Republican shift.
— Democrats favored for House; Republicans retain Senate edge: Democrats have roughly 60% odds of capturing the House, while Republicans hold a similar Senate advantage because redistricting and an unfavorable map limit the potential for a Democratic wave.
WEATHER
— NWS outlook: Hazardous heat continues over parts of central and southern U.S. into next week: Dangerous heat will persist while severe thunderstorms and flash-flooding risks extend from the Upper Midwest and Great Lakes into the Ohio Valley, Northeast and Southeast.
— Heat dome grips western Corn Belt at crop’s make-or-break moment: Triple-digit highs and unusually warm nights threaten corn grain fill and soybean pod development across the western Corn Belt and Plains, although relief should begin arriving from the east by midweek.
| TOP STORIES—U.S./Iran air war pauses, but Hormuz keeps the fuse litOmani talks offer an off-ramp as maritime and Red Sea risks widen Major media report that the U.S. and Iran have completed a second night without direct air or missile attacks, breaking a cycle that included 13 consecutive nights of U.S. strikes and near-daily Iranian retaliation against countries hosting American forces. Oman-mediated talks on the Strait of Hormuz also made progress over the weekend. But Tehran says shipping conditions have not changed, while U.S. Central Command says its naval blockade remains fully operational. This is a tactical pause in the bombing — not yet a ceasefire or a reopening of the Gulf’s main energy artery. Direct strikes pause, but maritime confrontation continues. President Donald Trump withheld approval for additional strikes Friday after authorizing daily attack plans for nearly two weeks. U.S. military planners remain ready to resume operations, and Trump has said negotiations are underway while warning that the military option remains available. Iran, meanwhile, has not conducted additional weekend attacks against U.S. bases or neighboring countries. However, neither side has stood down at sea. CENTCOM says that since the blockade resumed, U.S. forces have redirected 12 commercial vessels, disabled two and boarded two others. On Friday, U.S. forces disabled the Mozambique-flagged tanker M/T Lavine after CENTCOM said it ignored repeated warnings; on Saturday, U.S. personnel boarded the M/T Charminar, verified compliance and allowed it to continue. Iranian state television reported Sunday that Revolutionary Guard naval forces had stopped six vessels during the previous 24 hours for alleged “unauthorized” crossings, firing warning shots and forcing them to change course. That claim has not yet been independently verified, but it reinforces the central point: the air war may be paused, while the contest for physical control of the strait continues. Oman talks target the immediate trigger. Iranian Foreign Ministry spokesperson Esmaeil Baghaei said Iranian and Omani deputy foreign ministers held several rounds of technical discussions Friday and Saturday. The talks covered navigational principles and operating procedures intended to provide safe passage while respecting the claimed sovereign rights of Iran and Oman. Baghaei described the discussions as productive but said there had been no change in vessel traffic. The encouraging part is that the negotiations are focused on the operational dispute that reignited the fighting rather than attempting to solve every U.S./Iran disagreement at once. The central issue is who controls passage: Washington wants dependable freedom of navigation without Iranian permission or fees; Tehran wants vessels to use a route near its coastline under a system it administers. Mediators are reportedly exploring a compromise under which Iran would retain a role in managing transit but impose fewer restrictions. A viable arrangement would probably require designated lanes, advance vessel notifications, military deconfliction procedures and reciprocal no-fire commitments. The U.S. could then ease the blockade in stages as commercial traffic resumes. Until ships actually begin moving regularly, however, diplomatic claims of “progress” will remain less important than behavior on the water. The conflict is spreading even as Washington and Tehran pause. The most dangerous weekend development occurred outside the Gulf. Iran-aligned Houthi forces attacked Saudi Aramco facilities at Jizan and Yanbu along the Red Sea coast. Reuters verified smoke near the Jizan refinery, and trading sources reported possible damage to fuel and oil-storage facilities. Missiles aimed at Yanbu — Saudi Arabia’s principal Red Sea oil port — were intercepted. Saudi-backed forces responded with strikes against Houthi-controlled areas in Yemen. That escalation matters because Saudi Arabia has increasingly moved oil westward to avoid the disrupted Strait of Hormuz. If the Houthis can also threaten the Bab el-Mandeb Strait or facilities at Yanbu, they can put pressure on the principal alternative route. Saudi barrels would then face longer, more expensive journeys through Egypt’s Suez and Sumed systems or around the Cape of Good Hope. Iran also accused Ukraine of striking an Iranian commercial vessel in the Caspian Sea, killing one sailor and injuring another. Although separate from the immediate U.S/.-Iran confrontation, the episode demonstrates how the Iran and Ukraine conflicts are becoming increasingly interconnected and increases Tehran’s incentive to retaliate beyond the Gulf. Trump’s pause reflects both diplomacy and military constraints. The decision to hold fire appears to reflect more than diplomatic optimism. Reuters reported concerns within the administration about widening the war, straining U.S. weapons inventories, alienating Gulf partners and worsening the energy shock. Vice President JD Vance and Joint Chiefs Chairman Gen. Dan Caine reportedly raised munitions-stockpile concerns during Friday’s White House discussions. That does not mean Washington has abandoned escalation. Rather, the administration appears to have concluded that another round of limited nightly strikes would produce diminishing returns unless Trump authorizes a much larger campaign. The pause therefore gives diplomacy a chance while preserving the threat of rapid escalation. Israeli Prime Minister Benjamin Netanyahu’s scheduled meeting with Trump on Tuesday is another potential turning point. Netanyahu is expected to press for continued pressure on Iran’s nuclear, missile and military infrastructure, while Washington currently appears more focused on reopening the strait and stabilizing energy markets. The visit could either reinforce U.S. leverage in the talks or narrow the diplomatic window if Tehran concludes that Israel is preparing to reenter the fighting. Market analysis: relief is real, but fragile. Oil prices demonstrated Friday how quickly markets will remove part of the war premium when negotiations appear possible. Brent crude fell 3.88% to $96.78 per barrel, while West Texas Intermediate dropped 3.12% to $89.31. Even after the decline, Brent gained nearly 10% for the week and WTI rose 8.27%, reflecting continued concern about Hormuz, the Red Sea and physical supply disruptions elsewhere. The Sunday evening reopening will test whether traders view the weekend as genuine de-escalation. A third night without U.S. or Iranian strikes and evidence of an emerging transit agreement would probably pressure crude lower, analysts signal But Iranian warning shots, continued U.S. blockade enforcement or additional Houthi attacks on Saudi infrastructure could quickly push Brent back above $100. For agriculture, the important distinction is between lower crude prices and normalized energy logistics. Even if futures retreat, elevated tanker insurance, longer shipping routes and tight diesel supplies can preserve higher freight and fuel costs. Fertilizer, chemicals and other energy-intensive farm inputs would remain exposed until regular shipping through Hormuz and the Red Sea is visibly restored. Bottom line: The most likely near-term outcome is armed bargaining: the U.S. and Iran avoid another nightly exchange while Oman works on maritime rules, but both sides continue enforcing competing restrictions against commercial vessels. That is more stable than last week’s escalating air campaign, yet it remains vulnerable to a single miscalculation involving a tanker, warning shot, mine or missile. The next decisive indicators will be actual vessel movements — not diplomatic statements —t he continuation of the U.S. strike pause, the behavior of Iran’s Revolutionary Guard in Hormuz, further Houthi action around Yanbu and Jizan, and Tuesday’s Trump-Netanyahu meeting. A pause accompanied by verified commercial transit could become a credible off-ramp. A pause in which both navies continue stopping ships is merely an intermission.—HF Sinclair sues EPA over stalled biofuel waivers as Sept. 1 compliance clock ticksRefiner says agency is “dragging its feet” on small-refinery exemptions — a suit that lands squarely in the middle of record blending mandates, a 42-petition backlog and a Senate standoff over year-round E15 HF Sinclair Corp. took the Environmental Protection Agency (EPA) to court Friday, accusing the agency of unlawfully delaying decisions on its petitions for exemptions from Renewable Fuel Standard (RFS) blending mandates. The EPA is “dragging its feet on a decision it could’ve made months ago,” the company said in its filing. An EPA spokesperson declined comment, citing pending litigation. The Dallas-based refiner is hardly alone. Roughly 42 small refinery exemption (SRE) petitions remain pending at EPA, and the agency approved or denied none of them over the past month — a conspicuous stall for an agency that spent much of 2025 boasting it had gotten the SRE program “back on track” by clearing a 175-petition backlog stretching to 2016. The American Fuel & Petrochemical Manufacturers, the refining sector’s chief trade group, has filed its own litigation arguing the current mandates will sharply raise compliance costs and pump prices. Why the Sept. 1 date is the whole ballgame. The compliance credits refiners use to satisfy their blending obligations — Renewable Identification Numbers, or RINs — expire Sept. 1. A refiner that gets a hardship waiver after that date has, in practical terms, already been forced to comply: it will have bought the RINs, banked nothing, and received “relief” worth little. HF Sinclair pointedly reminded the court that judges have already recognized “the clock is ticking” for petitioners. That is the real function of this lawsuit — less a demand for a particular answer than a demand for any answer while an answer still has cash value. Sources say to expect other waiver-seekers to pile on if EPA does not move quickly; nothing invites copycat filings like a deadline the agency itself cannot stop. EPA’s box. The agency’s slow walk is understandable, if not defensible. In late March it finalized the most aggressive blending requirements in the program’s history — 26.81 billion RINs for 2026 rising to 27.02 billion in 2027, with biomass-based diesel at 9.07 billion and 9.20 billion RINs — and paired them with a policy of reallocating 70% of exempted volumes from 2023-2025 waivers onto non-exempt refiners. That 70% figure was a split-the-baby compromise that satisfied no one: biofuel and farm groups wanted 100% reallocation, so waivers cost them nothing; refiners view reallocation as simply shifting the hardship next door. Every pending petition EPA now grants either shorts the biofuel sector (if volumes aren’t fully backfilled) or raises costs on larger refiners (if they are). Deciding late may be the agency’s least-bad political option — but as HF Sinclair’s suit demonstrates, it is legally the most exposed one. Courts have little patience for open-ended agency delay when a statute contemplates timely hardship review. Market read. The unresolved petitions are a standing source of RIN-price uncertainty. A wave of grants with partial reallocation would be bearish for D6 ethanol credits and, at the margin, for corn and soybean oil demand — exempted gallons are gallons nobody has to blend. Conversely, mass denials (or grants fully reallocated) would keep the record 2026-27 mandates intact and supportive of the ethanol and renewable diesel complex. For a farm economy leaning hard on biofuel demand to offset big crops and stubbornly high input costs, the difference between those outcomes is measured in real bushels. The waiver docket, not the headline mandate, is now the swing variable in biofuel demand for the 2026 compliance year. The political overlay. The exemption fight is inseparable from the year-round E15 battle on Capitol Hill. The House in May passed HR 1346 — year-round, nationwide E15 sales, 218-203 — but only by pairing the ethanol industry’s top priority with curbs on refinery exemptions, the very relief HF Sinclair is suing to obtain. That pairing is precisely why the bill faces steep Senate resistance: oil-state senators and refiner lobbying have stalled it, and the soybean sector balked at the package as drafted. Why? Every SRE that EPA grants strengthens the corn lobby’s argument that exemptions gut the RFS and must be reined in legislatively; every month of delay strengthens refiners’ argument that the program is administratively broken. The lawsuit, in other words, is also a lobbying document. Bottom line: HF Sinclair’s suit is best read as an effort to force EPA’s hand before the Sept. 1 RIN expiration renders the pending waivers moot. Whichever way the agency jumps, it detonates something — RIN markets, farm-state goodwill, or refiner litigation. Watch for(1) an EPA decision batch before Labor Day, (2) copycat refiner suits in the coming weeks, and(3) any Senate movement to graft an E15/SRE compromise onto a must-pass vehicle this fall. The RFS was designed to run on autopilot; in 2026 it is being flown one lawsuit at a time. —Russia locks in gasoline export ban through year-end, dangles diesel relief — but only on its own termsPledge to lift the diesel ban “when the market recovers” is less an olive branch to global fuel buyers than an admission that Ukraine’s refinery campaign has broken Moscow’s ability to do both — supply its own pumps and the world’s Russia’s fuel crisis took clearer shape Saturday when Deputy Prime Minister Alexander Novak, speaking in Omsk, confirmed the government will extend its gasoline export ban — for producers and non-producers alike — through the end of 2026, while signaling the separate diesel export ban will be lifted “in due course” once the domestic market recovers. The current restrictions expire July 31. Why the diesel ban gets different treatment. The asymmetry is telling. Gasoline is the politically sensitive fuel — it is what Russian motorists queue for, and shortages at the pump are a visible embarrassment the Kremlin wants contained through year-end. Diesel is different: Russia normally produces roughly twice what it consumes domestically, historically exporting around 817,000 barrels per day in 2025. Bottle that surplus up too long and refineries face a glut, forcing them to cut crude runs — which would then worsen the gasoline shortage, since you cannot make one product without the other. Novak’s promise to lift the diesel ban is thus driven by refinery economics, not magnanimity: keeping it in place indefinitely would cannibalize the very gasoline output Moscow is trying to protect. The damage behind the policy. The bans are downstream of Ukraine’s methodical air campaign against Russian refining. Ukrainian officials claim strikes have disabled roughly 42–43% of Russia’s refining capacity as of early July, with fuel production down about 25% year-on-year in June and output running an estimated 20% below domestic demand. More than 50 regions have seen localized rationing, and Russia — one of the world’s great fuel exporters — is now importing product from Belarus, Kazakhstan and even India. Novak’s comment that Siberia may need fuel delivered from Kazakhstan, where he conceded surplus supplies are thin, underscores how stretched the system is. His claim that the situation has “considerably improved” and that some refineries have restarted deserves skepticism: repaired plants remain within reach of the same drones that hit them the first time, and Ukraine has shown it will re-strike. Global market stakes. Russia’s diesel exports had already collapsed to about 234,000 bpd in early July, down roughly 39% from June and more than 70% from 2025 norms. The withdrawal — layered on top of Middle East supply disruptions — sent U.S. ULSD futures up 11% in a single session earlier this month, with European gasoil hitting a record premium near $61 a barrel over Brent. U.S. distillate inventories sit about 6% below the five-year average heading into the season of peak diesel demand. If Novak follows through and diesel exports resume in August or September, that would be meaningful bearish relief for global distillate cracks. But the pledge is conditional and vague — “when the market recovers” is a standard Moscow puts entirely in its own hands, and Interfax reported just Thursday that officials were weighing a one-month extension instead. Sources say traders should treat Saturday’s remarks as an intention, not a schedule. The ag angle. For U.S. agriculture, the diesel question is the one that matters. Farm diesel has been the sleeper input-cost story of 2026 — Illinois farm diesel hit a record $5.41/gallon in May, nearly double year-earlier levels, and fuel demand ramps sharply into fall harvest, when combines and grain trucks do their heaviest work. Fuel, lube and related energy inputs are already squeezing corn and soybean budgets that penciled thin before the run-up. A genuine resumption of Russian diesel exports would help loosen the global distillate balance and could take some edge off harvest-season fuel bills. But the base case for planning purposes should remain elevated diesel through Q4: Russian export volumes will recover only as fast as bombed refineries do, Ukraine retains both the capability and the incentive to keep hitting them, and the gasoline ban running through December means Russian refiners will keep prioritizing domestic supply. Farmers weighing fall fuel contracts shouldn’t count on Novak’s conditional promise to bail them out. Bottom line: Saturday’s announcement locks in tightness in one market (gasoline, through year-end) while offering only a conditional, self-judged timeline for relief in the other (diesel). The structural driver — Ukraine’s demonstrated ability to take Russian refining offline faster than Russia can repair it — hasn’t changed. Until it does, every Russian pledge to restore exports comes with an asterisk written in drone range. |
| FINANCIAL MARKETS |
—Equities Friday and weekly change: U.S. equities ended a volatile week mixed on Friday, July 24, as investors rotated away from semiconductors and other richly valued artificial-intelligence plays while selectively buying industrial, real estate and materials shares. The Dow gained nearly 236 points and the S&P 500 eked out a fractional advance, but the Nasdaq declined 0.6%.
The Dow completed its third consecutive weekly decline, while the S&P 500 and Nasdaq posted a second straight losing week. Despite the pullback, year-to-date gains remained solid at 8.3% for the S&P 500, 8.1% for the Dow, 7.5% for the Nasdaq Composite and 18.1% for the Russell 2000.
AI spending replaces AI optimism as the immediate market question. The central issue was not whether companies are generating revenue from artificial intelligence, but how much capital they must commit before those investments produce acceptable returns. Intel fell 7.9% despite reporting its strongest revenue growth in 17 years and forecasting better-than-expected quarterly results. Its plans to increase spending reinforced concerns that the semiconductor industry’s investment cycle may be running ahead of near-term cash generation. The Philadelphia Semiconductor Index dropped 4.5%, while the S&P 500 technology sector lost 0.9%.
Tesla declined another 2.1% and Meta Platforms fell 1.8%, reflecting continued pressure on companies associated with large AI and infrastructure budgets. American Express dropped 4.3% after raising its revenue forecast but leaving its profit outlook unchanged, suggesting investors are increasingly unwilling to reward revenue growth that requires heavier spending. Verizon gained 5.8% after stronger-than-expected subscriber additions and an improved annual outlook.
The market was not uniformly weak. Real estate led the S&P 500 sectors with a 2.4% gain, helped by Digital Realty’s improved outlook, while materials rose 1.4%. Advancing stocks outnumbered decliners on the New York Stock Exchange, even as Nasdaq breadth remained negative. That combination points to rotation rather than a wholesale abandonment of equities: money moved away from expensive technology leadership and toward companies with more visible near-term earnings or assets that could benefit from inflation.
Oil retreats Friday but leaves an inflation problem behind. Brent crude fell 3.9% Friday to $96.78 per barrel, while West Texas Intermediate declined 3.1% to $89.31. Reports that China was attempting to revive U.S./Iran negotiations prompted profit-taking after Brent had closed above $100 on Thursday. Nevertheless, Brent gained nearly 10% for the week and WTI advanced 8.27% as tanker traffic through the Strait of Hormuz remained severely restricted and attacks threatened Red Sea shipping.
Treasury yields actually eased slightly Friday alongside oil, rather than rising during the session. The 10-year yield finished near 4.68%, however, after reaching roughly 4.71% Thursday—its highest level since January 2025. The weekly rise in oil and yields remains the larger concern because higher energy costs can lift headline inflation while higher bond yields reduce the present value investors place on future corporate profits.
The 4.75% level on the 10-year yield is emerging as an important test. A sustained move above it could create additional valuation pressure, particularly for technology companies whose expected profits are concentrated further in the future. A move toward 5% would pose a broader challenge by making bonds more competitive with stocks and raising financing costs for businesses and consumers.
The practical market test is whether oil can remain below $100 and the 10-year Treasury yield below roughly 4.75%. Stability in both would allow earnings growth and rotation into nontechnology sectors to support the broader market. Renewed disruption to Middle East energy flows, a surprise Fed increase or disappointing AI-spending guidance could instead extend the Nasdaq’s correction and pull the S&P 500 decisively lower.
| Equity Index | Closing Price July 24 | Point Difference from July 23 | % Difference from July 23 | Weekly Change |
| Dow | 51,947.25 | +235.60 | +0.46% | -0.38% |
| Nasdaq | 24,975.82 | -161.87 | -0.64% | -2.13% |
| S&P 500 | 7,411.98 | +3.68 | +0.05% | -0.61% |
—Week ahead: Fed, big tech earnings and Iran risk collide in markets’ biggest week of the summer
Central banks on three continents meet as Washington’s July policy decision lands alongside Q2 GDP, PCE inflation and results from Apple, Microsoft, Amazon and Meta — all under the shadow of Gulf supply disruptions
The week of July 27 stacks nearly every market-moving event into five trading days, and the interplay among them is what matters most.
Start with the geopolitical overlay. The U.S./Iran confrontation — strikes, naval blockades and interdictions at maritime chokepoints — is doing what Middle East escalation always does: lifting energy prices and, with them, global inflation expectations. That backdrop complicates everything else on the calendar. Any diplomatic thaw would relieve pressure on crude and give central banks breathing room; further escalation would stiffen the inflation headwinds just as policymakers meet.
The Fed is the pivot point. The FOMC (July 28-29) is widely expected to hold rates, making Chair Kevin Warsh’s press conference the real event. His task is awkward: the advance Q2 GDP estimate is expected to show growth accelerating to 2.3% annualized (from 2.1%), powered by AI-related investment, a World Cup boost and resilient consumers — hardly an economy begging for cuts. Yet the June core PCE print is forecast at just 0.1%, down from 0.3%, the kind of disinflation doves will seize on. Add the Q2 Employment Cost Index and CB consumer confidence, and by Thursday markets will have a nearly complete read on whether the Fed’s patience is justified. Watch for how Warsh weighs energy-driven price risk from the Gulf against cooling underlying inflation. Even without a rate hike, a more hawkish policy statement or warnings from Fed Chair Kevin Warsh about oil, tariffs and inflation could push yields higher. Strong growth paired with sticky inflation would strengthen the case for additional rate increases; weaker growth and moderating core inflation would give the Fed more room to wait.
Earnings are the other heavyweight. Roughly one-third of S&P 500 companies are scheduled to report. Microsoft and Meta report Wednesday, Amazon and Apple Thursday — four of the market’s largest names in 48 hours, with Visa, Mastercard, Boeing, Exxon, Chevron and Samsung filling out the tape. With AI capex underpinning the GDP acceleration, guidance on AI spending from the hyperscalers effectively doubles as macro data. Any wobble there hits both equity leadership and the growth narrative simultaneously. Following the negative reactions to Alphabet, Tesla and Intel, merely beating earnings estimates may not be sufficient: investors will focus on capital spending, free cash flow and evidence that AI investments are producing measurable revenue and margins.
Overseas, the pattern holds with hawkish undertones. The Bank of England should stay at 3.75%, with the vote split carrying the signal. The Bank of Japan, having hiked 25bp in June, is expected to pause — but accelerating Tokyo core CPI (1.8% forecast) keeps further tightening live. Eurozone Q2 GDP is seen limping in at 0.2% while flash inflation ticks up to 2.9% — a mild stagflationary mix that leaves the ECB boxed in.
China’s July Politburo meeting is the sleeper event. Markets expect targeted support rather than broad stimulus at this mid-year checkup, and with official PMIs expected to show manufacturing and services stagnating, the risk is that Beijing under-delivers against even modest hopes.
Bottom line: the bullish case — solid US growth, soft core inflation, strong Big Tech results — is real but fragile, because its biggest vulnerability sits outside the data entirely: a Gulf escalation that re-ignites energy inflation would undercut the disinflation story central banks are counting on. Position for the Fed and earnings, but hedge for Hormuz.
| AG MARKETS |
—Brazil set to cede No. 2 corn export rank to Argentina
Iran disruptions and rising domestic demand reshape Brazil’s corn outlook
Brazil is on track to lose its position as the world’s second-largest corn exporter to Argentina in the 2025/26 season, but the shift does not signal a collapse in Brazilian shipments. Hedgepoint Global Markets forecasts Brazil will export 43 million metric tons, up 1.9 million tons, or 4.6%, from the prior season’s 41.1 million tons. USDA projects Argentina at 45 million tons, while the U.S. is expected to remain the leading supplier.
The ranking change is primarily a story of relative competitiveness. Argentina is benefiting from a strong harvest and greater export availability, while Brazil is confronting weaker access to Iran and rapidly expanding domestic corn demand. That combination could limit how aggressively Brazilian exporters can compete even with a crop near last season’s record level.
Perspective: Iran is the clearest near-term drag. It was Brazil’s largest corn buyer in 2025, taking 9 million metric tons, but DataLiner shows January-May 2026 shipments at just 550,792 tons, down 1.15 million tons, or 67.7%, from a year earlier. Hedgepoint separately cited roughly 1.5 million tons purchased by Iran during the first part of 2026, compared with 2.3 million tons a year earlier. The figures appear to reflect different periods or datasets, but both point to a steep deterioration in trade with a market that previously absorbed a large share of Brazil’s export surplus.
Brazil has partly offset that loss by diversifying sales. Egypt and Vietnam together accounted for 45.7% of January-May exports, with shipments to Vietnam more than tripling. China, Algeria and Malaysia also posted sizable gains. The 10 destinations in the table represented 88.8% of reported exports and recorded a combined net increase of about 606,000 tons despite sharp declines to Iran, Saudi Arabia and Morocco.
The larger structural issue is domestic demand. Hedgepoint expects corn use by Brazil’s ethanol sector to jump 5.5 million metric tons to 28.5 million tons, a 23.9% increase. Feed use is forecast to edge up 200,000 tons to 61.2 million tons. The ethanol increase alone is nearly three times the projected 1.9-million-ton gain in exports, creating more competition between processors and exporters for the second corn crop.
At 140.3 million metric tons, Brazil’s projected crop is only 200,000 tons below the previous season. Production is therefore not the central problem. The risk is allocation: feed and ethanol demand would consume 89.7 million tons before accounting for food, seed, industrial uses, losses or stock changes. Strong domestic processing margins, a firmer real, shipping disruptions or additional weakness in Iranian demand could make the 43-million-ton export forecast harder to reach.
Bottom line: Brazil can expand corn exports and still fall to third place. Argentina’s expected 45-million-ton program gives it a narrow advantage, while Brazil’s export performance will depend increasingly on replacing Iranian demand and balancing overseas sales against a fast-growing ethanol industry.
Top destinations for Brazilian corn exports, January-May 2026
Metric tons; change and growth are versus January-May 2025
| Destination | Jan-May 2026 | Change vs. 2025 | Growth | Market share |
| Egypt | 1,277,849 | +340,329 | 36.3% | 25.52% |
| Vietnam | 1,011,702 | +685,915 | 210.5% | 20.21% |
| Iran | 550,792 | -1,153,441 | -67.7% | 11.00% |
| Algeria | 428,033 | +176,433 | 70.1% | 8.55% |
| China | 325,077 | +252,477 | 347.8% | 6.49% |
| Malaysia | 290,927 | +290,927 | N/M | 5.81% |
| Saudi Arabia | 170,796 | -142,017 | -45.4% | 3.41% |
| Unknown | 135,101 | +135,101 | N/M | 2.70% |
| Indonesia | 133,004 | +52,810 | 65.9% | 2.66% |
| Morocco | 124,329 | -32,123 | -20.5% | 2.48% |
N/M = not meaningful because comparison-period volume was zero or not reported. Source: DataLiner, as supplied.
—Ag markets, Fri., July 24: Soybeans power to contract highs as grains extend weather rally; cattle bulls stir as big USDA reports land
Corn adds 20 cents and beans a half-dollar on heat worries heading into August, wheat flashes reversal warnings from contract highs, and Friday’s Cattle Inventory and Cattle on Feed data — plus USDA’s late-day announcement of a phased U.S./Mexico border reopening — reset the table for the livestock trade
Weather did the heavy lifting in the grain and oilseed markets this week. A hotter, drier turn in Midwest forecasts heading into August — the make-or-break month for the U.S. soybean crop — sent November beans to a new contract high and pulled corn to a two-month peak before both markets paused Friday to consolidate. The wheat complex told a more cautionary tale: contract highs scored overnight Thursday into Friday gave way to heavy profit-taking and technically bearish key reversals, an early warning that near-term tops may be in place there. In the livestock pits, cattle futures strung together two straight days of solid gains to close out the week, and traders now must digest a rare double-barreled Friday dose of USDA data — the midyear Cattle Inventory and monthly Cattle on Feed reports — along with a late-Friday announcement that the U.S./Mexico border will begin a phased reopening to Mexican cattle on Aug. 24.
•Corn: Bulls catch their breath, keep the wheel. December corn closed steady Friday at $4.87 1/2, near mid-range, after notching a two-month high early in the week. For the week, the contract gained 20 cents. Friday’s pause was mild profit-taking, not a rejection — prices remain in an uptrend on the daily chart, and that keeps the bulls in the driver’s seat heading into next week. With pollination largely behind the crop, the market’s attention shifts to grain fill and whether the heat building into August trims top-end yield potential. Monday afternoon’s USDA crop progress and condition ratings become the first checkpoint.
Soybeans: New contract high as August heat looms
• November soybeans rose 9 3/4 cents Friday to $12.53 1/2, nearer the daily high after posting a new contract high, and finished the week up a stout 50 1/2 cents. September soybean meal gained $2.00 to $330.80, an eight-month high, and added $13.70 on the week. September bean oil was the laggard, falling 122 points Friday to 73.47 cents — pressured by solid losses in crude oil — and slipped 46 points for the week. The bean and meal rallies are a classic weather-premium build: the Midwest is heating up just as the crop enters its critical pod-setting and pod-filling stretch, and the trade is unwilling to sell that risk until forecasts prove otherwise. So long as August maps lean hot and dry, the path of least resistance in beans and meal stays up.
Wheat: Contract highs, then key reversals — a yellow flag.
•The wheat markets delivered the week’s clearest technical warning. September SRW hit a contract high in overnight trade Friday, then buckled under heavy profit-taking and long liquidation to close down 18 1/4 cents at $6.78, nearer the daily low and down 4 3/4 cents on the week. September HRW followed the same script — a contract high overnight, then a 14 1/2-cent slide to $7.45 1/4, though it still finished the week up 13 cents. September spring wheat fell 15 3/4 cents Friday to $7.14 1/4 but gained 22 1/2 cents for the week. Friday’s action carved technically bearish key reversals on the winter wheat daily bar charts — early clues that near-term tops are in place. Bulls will need fresh fundamental fuel, likely from export demand or a Northern Hemisphere weather scare, to negate that damage.
•Cotton: Profit-taking trims a solid week. December cotton fell 123 points Friday to 79.98 cents, near the daily low, as traders booked profits ahead of the weekend and crude oil’s slide added spillover pressure. Even so, the fiber finished the week up 135 points. Cotton remains hostage to the same August-weather question hanging over the grains, and traders will be watching Monday afternoon’s weekly USDA crop progress report for condition ratings across the Cotton Belt.
•Cattle: Bottoming clues meet a big Friday news cycle. August live cattle rose $1.675 Friday to $227.075, near mid-range and up $2.65 for the week — a technically bullish weekly high close. August feeders gained $1.55 to $345.325, though they slipped 62 1/2 cents on the week. Two straight sessions of decent gains, following Thursday’s rebounds, are early clues the bears may finally be exhausted and market bottoms may be in place after the recent corrective break. The trade now has a full plate of fresh fundamentals to sort through. USDA released two major reports Friday (link to our special report). The midyear Cattle Inventory report showed the total herd at 94.2 million head, up fractionally from a year ago — the first year-over-year increase since 2018 — but beef cow numbers still down about 1%, and beef replacement heifers up 3%, the first increase in nine years. That combination reads as a cycle inflection point rather than expansion: heifer retention signals the bottom is in for the herd, but it also tightens near-term feeder supplies. The Cattle on Feed report put July 1 feedlot inventories at 11.37 million head, up 2% from a year ago, with June placements down 3% and June marketings down 3% — the smallest June marketings on record since the series began in 1996. Net-net, the reports look near-term neutral but structurally bullish, especially for feeders and deferred live cattle. Then, late Friday, USDA announced a phased reopening of the U.S./Mexico border to cattle imports beginning Aug. 24, starting with the port at Douglas, Ariz., with Santa Teresa and Columbus, N.M., to follow pending evaluation. The border has been closed to Mexican cattle since July 2025 over the New World screwworm outbreak, and USDA says every animal will undergo full inspection, with the phase-in subject to pause if risk rises. The reopening will eventually add feeder supplies at the margin — a modest headwind for feeder futures — but volumes will build slowly and conditionally, and the announcement does little to change the structurally tight U.S. supply picture the Friday reports confirmed. Watch Monday’s open for the market’s verdict on the combined news. Links (here and here) to two special reports we did regarding the phased reopening of the border.
•Hogs: Nine-week high, bullish weekly close. August lean hogs rose 70 cents Friday to $102.85, nearer the daily high, after hitting a nine-week high, and gained $1.20 for the week. Speculative technical buying keeps flowing into a market in a solid daily-chart uptrend, and Friday’s technically bullish weekly high close only strengthens that posture heading into next week. Firm cash and pork cutout fundamentals would keep the path of least resistance pointed higher; the chart bulls have the momentum until proven otherwise.
The week ahead: Monday afternoon’s USDA crop progress and condition report is the first test for the grain market weather premium, and updated August forecast maps will drive the daily headlines in corn, beans and cotton. In cattle, watch how futures absorb the inventory data and the border news — a follow-through higher close early in the week would go a long way toward confirming that bottoms are in.
| Commodity | Contract Month | Close July 24 | Change From July 23 | Weekly Change |
| Corn | December | $4.87 1/2 per bu. | Steady | +20 cents |
| Soybeans | November | $12.53 1/2 per bu. | +9 3/4 cents | +50 1/2 cents |
| Soybean Meal | September | $330.80 per ton | +$2.00 | +$13.70 |
| Soybean Oil | September | 73.47 cents per lb. | -122 points | -46 points |
| SRW Wheat | September | $6.78 per bu. | -18 1/4 cents | -4 3/4 cents |
| HRW Wheat | September | $7.45 1/4 per bu. | -14 1/2 cents | +13 cents |
| Spring Wheat | September | $7.14 1/4 per bu. | -15 3/4 cents | +22 1/2 cents |
| Cotton | December | 79.98 cents per lb. | -123 points | +135 points |
| Live Cattle | August | $227.075 per cwt. | +$1.675 | +$2.65 |
| Feeder Cattle | August | $345.325 per cwt. | +$1.55 | -62 1/2 cents |
| Lean Hogs | August | $102.85 per cwt. | +$0.70 | +$1.20 |
| ENERGY MARKETS & POLICY |
—Friday: Oil retreats on diplomacy hopes, but supply risks remain elevated
Friday’s profit-taking trims prices, while disrupted shipping and continued U.S./Iran fighting keep a substantial geopolitical premium in crude
Oil prices fell sharply Friday as reports that China was seeking to revive U.S.-Iran peace negotiations encouraged traders to lock in profits after Brent crude briefly climbed above $100 per barrel earlier in the week.
Brent crude settled at $96.78 per barrel, down 3.88%, while West Texas Intermediate finished at $89.31, a decline of 3.12%. The pullback did little to erase the week’s broader rally: Brent gained nearly 10%, and WTI rose 8.27%, reflecting persistent concern that the Middle East conflict could disrupt global oil supplies.
The market’s focus remains on physical shipping conditions rather than diplomatic headlines alone. Tanker traffic through the Strait of Hormuz is still running well below normal, while missile exchanges between the U.S. and Iran, attacks on Saudi oil tankers in the Red Sea and Houthi threats near the Bab el-Mandeb Strait have placed multiple energy chokepoints at risk.
Friday’s decline therefore appears to be profit-taking rather than a fundamental easing of the supply threat. China’s diplomatic push could lower crude’s geopolitical premium if it produces a ceasefire or restores shipping confidence, but negotiations have not yet translated into normal tanker movements.
The widening gap between Brent and WTI also reflects the market’s concern about internationally traded barrels. Brent is more directly exposed to disruptions involving Middle Eastern and seaborne supplies, while WTI remains partly insulated by strong North American production and infrastructure.
Bottom line: The outlook remains highly volatile. Any sustained reopening of shipping routes could send prices lower quickly, but prolonged restrictions through Hormuz or the Red Sea could remove substantial volumes from the market and push crude back above $100. Until tanker traffic recovers, Friday’s retreat should be viewed as a pause in the risk rally rather than confirmation that the oil-supply threat has passed.
| POLITICS & ELECTIONS |
—Brown’s Ohio comeback tests Democrats’ working-class brand
Veteran Democrat must bridge a red-state divide without looking like the past
The Wall Street Journal (link) portrays former Sen. Sherrod Brown (D-Ohio) as both Democrats’ strongest available candidate in Ohio and an illustration of the party’s deeper problems. Brown, 73, is attempting to return to the Senate by defeating Sen. Jon Husted (R-Ohio) in the race to complete the final two years of JD Vance’s term. But he must win back blue-collar and rural voters who have moved toward Republicans while also energizing younger progressives who view veteran party leaders as too cautious and entrenched.
Brown’s case rests on a political identity that once fit Ohio unusually well. He opposed the North American Free Trade Agreement when many Democrats embraced free trade, warned early that globalization was hurting workers and built a reputation as a labor ally willing to challenge corporations. That economic-populist record now sounds similar to themes Republicans — particularly President Donald Trump — have used to capture former Democratic industrial voters.
The difficulty is that Brown must run simultaneously as an experienced problem-solver and an anti-establishment reformer. His long tenure gives him relationships, legislative knowledge and a record of obtaining federal support for Ohio. But Republicans can turn those same credentials against him, portraying a politician first elected to Congress in 1992 as part of the Washington system he criticizes.
Brown is emphasizing affordability, health-insurance costs, electricity expenses associated with data centers and opposition to congressional stock trading. He is also drawing on his antiwar background to criticize the U.S.-Iran conflict and the higher gasoline prices that followed. Those issues allow him to connect economic populism with household concerns rather than relying solely on traditional Democratic appeals.
He will not lack financial support. Senate Minority Leader Chuck Schumer (D-N.Y.) encouraged Brown to run, and a Schumer-aligned group has pledged $60 million to help him. Yet national Democratic backing may be politically double-edged: It provides the resources needed for an expensive statewide campaign while making it easier for Republicans to depict Brown as the candidate of the national party establishment.
The electoral math remains unforgiving. Brown won re-election in 2018 by nearly seven percentage points but lost in 2024 by four points as Ohio continued moving toward Republicans. Democrats also face an enthusiasm problem in urban areas, where turnout has lagged heavily Republican regions, while some progressives want Brown to take more confrontational positions on Middle East policy.
Rural Ohio presents a different challenge. Brown can still attract respectful audiences and engage farmers on practical issues, but even voters who like him express disappointment with the Democratic Party and doubt that elected officials can deliver results. Brown’s strategy is to separate himself from the party’s image through personal contact and a record of constituent service.
The broader analysis: Brown probably has a higher ceiling in Ohio than a more conventional Democrat because his trade, labor and economic positions predate Trump’s takeover of the working-class message. But personal credibility may no longer be enough to overcome the state’s partisan realignment. His path requires an unusually difficult coalition: strong urban turnout, renewed enthusiasm among younger Democrats, continued union support and enough crossover backing from rural and working-class voters to narrow the Republican advantage.
Upshot: The race therefore amounts to more than a political comeback attempt. It will test whether Democrats can still compete in a formerly pivotal industrial state by reviving an older economic-populist identity — or whether Ohio’s shift toward Republicans has become too deeply rooted for even Brown to reverse.
—Democrats favored for House; Republicans retain Senate edge
Iran and affordability drive the mood, but the Senate map resists a wave
The Hill reports that, 100 days before the Nov. 3 midterms, Decision Desk HQ gives Democrats roughly a 60% chance of winning the House and Republicans roughly a 60% chance of retaining the Senate. Its central outcome is a 225-210 Democratic House and a 50-50 Senate, where Vice President JD Vance would preserve Republican control through his tiebreaking vote. Those numbers represent modest leans, not settled outcomes: DDHQ’s initial July forecast was almost identical, putting Democrats’ House chances at 61%, Republicans’ Senate chances at 57% and the average seat counts at 226-209 and 50-50. A 60% probability still leaves about a two-in-five chance that the other party wins.
The House advantage is real but fragile. Democrats benefit from an unfavorable national environment for the party controlling the White House, along with voter dissatisfaction over affordability and President Trump’s performance. But Republican gains from midcycle redistricting have raised the GOP’s floor and reduced the number of districts available for Democrats to capture. DDHQ estimates the new maps provide Republicans with an effective net gain of five seats, meaning Democrats’ practical hurdle is closer to eight seats than the nominal three needed to reach 218. The model indicates that a Democratic generic-ballot lead of roughly 3.5 to 5.5 points produces only a modest House advantage; around D+2.5, control becomes a coin flip. Axios similarly describes a national climate favoring Democrats but a district-level map that still helps Republicans.
The Senate is fundamentally a geography problem for Democrats. Republicans are defending 22 of the 35 seats being contested, but only Maine is in a state Trump lost in 2024. North Carolina is the sole Republican-held seat in a state Trump carried by fewer than 10 percentage points. Democrats need a net gain of four seats for an outright majority, and DDHQ calculates that their most plausible route requires winning seven of the 10 races most likely to decide control — including at least two states Trump won by between 11 and 14 points. That explains how Democrats could win the national House vote and flip the lower chamber while still falling short in the Senate.
Michigan is the hinge contest. The open seat created by the retirement of Sen. Gary Peters (D-Mich.) is Democrats’ most important defensive race. DDHQ estimates that a Republican victory there would raise the GOP’s chances of Senate control from 59% to 87%. The Aug. 4 Democratic primary between Rep. Haley Stevens (D-Mich.) and progressive candidate Abdul El-Sayed therefore carries national consequences. Republicans will try to make the general election about Democratic Socialists of America-aligned candidates and the Democratic Party’s ideological direction rather than Trump, Iran and household costs. The question is not whether one ideological label automatically determines the result, but whether the eventual nominee can maintain party unity and appeal beyond the Democratic base in a must-hold state.
Iran’s political importance runs through the economy. The conflict becomes especially damaging for Republicans when renewed fighting raises oil and gasoline prices, reinforcing existing affordability concerns. In a July 10-13 Economist/YouGov survey, 57% called the decision to go to war with Iran wrong, 59% disapproved of Trump’s handling of Iran and 55% said the U.S. should not continue its attacks. Those figures suggest the administration has limited room for further escalation without increasing its political exposure among independents and less committed Republican voters.
The new Emerson College survey showing Democrats ahead 53%-42% among likely voters is therefore significant, but it should be treated as a high-end indicator until replicated. Emerson also measured Trump’s approval at 39%, with 57% disapproving. Other measures are less favorable to Democrats: DDHQ has generally described the generic-ballot margin as roughly D+3.5 to D+5.5, while Silver Bulletin’s July 24 average was D+6.1. The common signal is a Democratic lead; the uncertainty is whether that lead is merely enough to overcome the Republican-leaning House map or large enough to generate a broader wave.
One further caution is that the chamber results are correlated. Although the most intuitive chamber-by-chamber forecast is a Democratic House and Republican Senate, DDHQ’s initial simulations gave Democrats a 40% chance of winning both chambers, Republicans a 36% chance and split control only a 24% chance. A late economic, military or candidate-related shock could therefore move House and Senate races in the same direction rather than producing the currently projected split.
Bottom line: This is not yet a blue-wave environment. Democrats have the clearer route to the House, but redistricting leaves little margin for polling erosion. Republicans retain the easier Senate path because Democrats must defend Michigan while winning several states that favored Trump decisively in 2024. The decisive variables will be whether the Democratic generic-ballot advantage holds through the fall, whether the party emerges unified from the Michigan primary.
| WEATHER |
— NWS outlook: Hazardous heat continues over parts of central and southern U.S. into next week… …Risk for severe thunderstorms and flash flooding across the Upper Midwest/Great Lakes, Ohio Valley, and portions of the Northeast… …Risk of severe thunderstorms and flash flooding across Southeast near a stalled frontal boundary… …Active monsoonal moisture fuels thunderstorms over the Southwest and into portions of the central Plains.
—Heat dome grips western Corn Belt at crop’s make-or-break moment
Triple-digit highs from the Dakotas to Kansas through Monday — and near-record warm nights — hit corn pollination and soybean pod set head-on, easing only slowly from the east by midweek.
The maps show a classic heat-dome signature parked over the Plains and western Corn Belt. Saturday’s observed highs reached 107° at Pierre, 104° at North Platte, 103° at Bismarck and 102° at Omaha, while the eastern Belt stayed comfortable in the 70s and 80s. Sunday the heat expands — 100°+ from Fargo to Wichita, with Omaha at 103° and Minneapolis near 98° — and Monday it peaks in the central and southern Plains (Dodge City 108°, Omaha, Kansas City and Topeka near 102°). By Tuesday the ridge begins to flatten: readings slip back into the low 90s across Iowa and Nebraska, and a lake-cooled front holds Chicago to 77°, though western Kansas stays near 100°.
Just as telling is the overnight-lows map: Sunday night bottoms out only at 82° in Kansas City, 80° in Omaha, Topeka and Wichita, and 78–79° from Des Moines to Minneapolis — the kind of hot nights that do damage no daytime map shows.
Why it matters now: late July is the single most yield-sensitive window of the season. Corn across the heart of the Belt will determine grain fill, when temperatures at or above the mid-90s can disrupt kernel set, and soybeans are flowering and setting pods, when sustained heat causes flower and pod abortion. Warm nights compound the stress — when lows stay above about 70°, plants burn energy on respiration instead of grain fill, trimming kernel weight even where daytime damage is limited. The saving grace in this pattern is its geography and duration: the worst heat is centered on the western Belt and Plains, the eastern Belt (Illinois, Indiana, Ohio, Michigan) stays in the 80s, and relief starts working in from the east by Tuesday. Whether that relief arrives with rain will decide how much of this heat event shows up in the next round of crop-condition ratings.
