Good morning!
Grains continue to show resilience... Corn, soybeans and wheat traded on both sides of unchanged overnight but are higher and near their session highs this morning, despite the escalating U.S./China tariffs war. As of 6:30 a.m. CT, corn futures are trading around a penny higher, soybeans are unchanged to 4 cents higher, winter wheat markets are 7 to 9 cents higher and spring wheat is mostly 4 cents higher. The U.S. dollar index is down nearly 1,200 points, plunging to the lowest level since April 2022 – which has implications for the economy and ag sector.
China ramps up tariffs on U.S. imports... China announced it will raise tariffs on all U.S. goods from 84% to 125% starting April 12, in its sharpest retaliatory move yet against President Donald Trump’s latest tariff escalation. The move is accompanied by a sharp rhetorical pivot: Beijing is done matching Washington dollar-for-dollar. “Given that American goods are no longer marketable in China under the current tariff rates, if the U.S. further raises tariffs on Chinese exports, China will disregard such measures,” said the ministry of finance. In a separate rebuke, China’s commerce ministry declared Washington’s use of high tariffs is now “economically meaningless,” calling them a bullying tactic meant to coerce Beijing. Nonetheless, the ministry issued a stark warning: “If the U.S. continues to infringe on China’s rights and interests, we will resolutely counterattack and fight to the end.” Of note: USDA Secretary Brooke Rollins said the administration is watching the impact of Chinese retaliation “hour by hour.” She predicted “we’ll see a little bit more movement and adjustment by the market as we move forward” but reiterated the administration was open to aid for farmers
Chinese exchanges restrict daily stock sales as U.S. trade war escalates... Chinese exchanges have set daily restrictions on net share sales by hedge funds and large retail investors, four sources told Reuters, as Beijing steps up support for its stock markets in an intensifying trade war with the United States. Two investor sources said a soft limit on daily net sales by individual hedge funds and big retail investors – implemented through verbal warnings from brokerages – had been set at 50 million yuan ($6.83 million). Failure to comply risked a suspension of trading accounts by the stock exchanges, which have issued the directive, two brokerage sources said.
EU leaders plan Beijing summit with Xi amid tariff shift... European Union leaders are preparing for a high-level summit in Beijing with Chinese President Xi Jinping in late July, according to the South China Morning Post. The planned shift in venue — the meeting was originally slated for Europe — signals the bloc’s growing urgency to engage China directly as trade tensions escalate with the United States.
Japan’s top trade envoy heads to U.S. for April 17 talks... Japan’s chief trade negotiator Ryosei Akazawa will visit Washington next week for high-level trade discussions with U.S. officials, according to a report from NHK cited by Bloomberg. The talks are scheduled for April 17 (Japan time). Akazawa will meet with U.S. Treasury Secretary Scott Bessent and U.S. Trade Representative Jamieson Greer. The agenda is expected to include tariffs, supply chain cooperation and potential adjustments to bilateral trade terms amid escalating global trade tensions.
Facing U.S. tariffs, Vietnam eyes crackdown on some China trade... In hope of avoiding punishing U.S. tariffs, Vietnam is prepared to crack down on Chinese goods being shipped to the United States via its territory and will tighten controls on sensitive exports to China, according to a person familiar with the matter and a government document seen by Reuters. The offer came as senior U.S. officials, including the influential White House trade advisor Peter Navarro, raised concerns about Chinese goods being sent to America with “Made in Vietnam” labels that draw lower duties. While Trump’s 46% tariffs on Vietnam have been paused for 90 days, the export-reliant country is hoping to get the duties reduced to a range of 22% to 28%, if not lower, according to three people with knowledge of the matter. In announcing the start of trade talks with the U.S. on Thursday, Vietnam’s government said on its official portal it would crack down on “trade fraud,” without providing specific details.
French wheat crop ratings decline... France’s ag ministry rated the country’s wheat crop as 75% good/excellent as of April 7, down one percentage point from the previous week. The rating is well above 64% on this date last year but the second lowest during the past five years. A dry start to spring has helped drain fields that remained soggy during fall and winter.
UK economy outperforms expectations in February but tariffs a threat to further growth... British GDP expanded 0.5% from the previous month in February, marking the strongest performance in 11 months. Finance minister Rachel Reeves called the data “encouraging” and investors trimmed their bets on Bank of England (BOE) interest rate cuts for the remainder of this year. However, markets are far more focused on U.S. tariffs, which BOE Deputy Governor Sarah Breeden warned on Thursday would have a “chilling effect” on output.
GOP budget plan clears, paving way for tax cuts, debt limit hike and possibly new farm bill provisions... Congress finalized the fiscal year 2025 budget resolution, setting the stage for Republicans to use reconciliation to pass sweeping changes to tax, immigration, border, energy and defense policy — without Democratic support. The measure directs committees in both chambers to begin drafting legislation aligned with President Trump’s key priorities, while also laying the groundwork for a significant increase in the debt limit and potential new tax cuts. If GOP leaders agree, some important new farm bill provisions could be included in the reconciliation package, including an increase for reference prices and some positive crop insurance program changes.
Trump floats legal path for undocumented farm workers to temporarily exit and re-enter... President Trump is considering a plan to allow undocumented workers in agriculture and hospitality to voluntarily leave the U.S. and return legally after a brief period abroad — potentially around 60 days. Announced during a Cabinet meeting, the proposal aims to ease labor shortages caused by intensified deportation policies. “We’re going to work with them… on trying to get them back in legally,” Trump said, framing it as a solution to retain essential workers while reinforcing legal migration processes. Businesses could vouch for workers’ return, especially in the agricultural and service sectors, which rely heavily on immigrant labor. Foreign-born workers now account for around 50% of the U.S. ag sector workforce, and their removal could lead to severe labor shortages, disrupting food production and increasing costs for farmers and consumers. The proposal signals a potential softening of Trump’s hardline immigration stance — balancing deportation rhetoric with economic realities.
USDA overhaul: Mass layoffs and major relocations planned... USDA is preparing for a sweeping reorganization that will bring mass layoffs and major geographic shifts, Government Executive reports. According to several USDA officials, the department is planning to eliminate thousands of jobs — potentially up to 9,000 positions — as it scales back to fiscal year 2019 staffing levels, the Government Executive magazine reports. In one of the most consequential shakeups to hit a federal agency in recent memory, USDA will reduce its Washington, D.C. presence significantly and relocate many remaining employees to newly established regional “hubs,” the locations of which remain undisclosed, the report added. USDA staff have also been told remote work will no longer be an option. Those who remain after the reduction in force must live within 50 miles of a new hub or relocate.
Futures pull cash cattle sharply lower... Cattle futures continue to closely follow activity in the stock market amid recessionary concerns and potential implications for beef demand. Recent heavy selling in cattle futures has dragged cash cattle prices lower, with most activity through Thursday $4.00-plus lower than week-ago.
Cash hog fundamentals continue to weaken... Pork cutout fell another $1.06 to $89.70 on Thursday. The CME lean hog index is down another 33 cents to $87.67 as of April 9. April lean hog futures, which expire next Monday and are settled against the index for April 16, finished Thursday $1.67 below today’s cash quote. May hogs hold a $1.17 discount, while June hogs currently have only a $5.505 premium.
Overnight demand news... South Korea purchased 34,632 MT of rice, mainly to be sourced from the United States. Bangladesh purchased 50,000 MT of optional origin non-basmati parboiled rice.
See ‘Policy Updates’ for late-breaking morning news updates... For updates to items in “First Thing Today” or any late-breaking morning news stories, check “Policy Updates” on www.profarmer.com.
Today’s reports
- 2:00 p.m. Season Average Price Forecasts — ERS
- 2:00 p.m. Wheat Data — ERS
- 2:00 p.m. Peanut Prices — NASS
- 2:30 p.m. Commitments of Traders — CFTC