Annual U.S. Inflation Rose 6.4% in January on Higher Housing, Still-Elevated Food Costs

Latest Mexican decree still bars GMO corn for food as of 2024, to transition away from GMO corn in animal feed

The consumer price index climbed 6.4% in January from a year earlier, down from 6.5% in December, the Labor Department said this morning. That marked the seventh straight month of cooling in annual inflation since peaking at 9.1% in June, the highest reading since 1981. January’s inflation rate was still much higher than the 2.1% average in the three years before the pandemic. From a month earlier, inflation firmed. The CPI increased 0.5% in January from December, compared with a 0.1% increase the prior month. The cost of shelter was the largest contributor to the monthly gain, the department said. Prices for food, gasoline, and natural gas also rose in January. Core CPI, which excludes volatile energy and food prices, rose 5.6% from a year earlier, down from 5.7% in December. Core prices rose 0.4% on the month in January, the same as in December.

Senate Majority Leader Chuck Schumer (D-N.Y.) said a new briefing today will give senators more information about three “unknown objects” that U.S. forces recently shot down after they entered U.S. and Canadian airspace and were deemed to pose a threat to civilian aviation. “Congress is going to conduct a careful bipartisan examination of these various incidents and also look into why U.S. authorities didn’t find these Chinese surveillance balloons sooner,” Schumer said.

NATO chief Jens Stoltenberg said Monday that Russia has begun a new offensive in Ukraine. “We see how they are sending more troops, more weapons, more capabilities,” he said during a press conference in Brussels. Russia’s immediate goal, according to Eurasia Group analysis, is to gradually overwhelm outnumbered Ukrainian forces and take full control of the so-called Donbas region of Donetsk and Luhansk provinces, two of the Ukrainian regions Russia annexed last September. The early timing of this new escalation suggests Russia hopes to make significant gains before powerful new weapons sent by the West arrive in Ukraine.

China’s recovery from years of Covid-19 lockdowns may have a limited impact on the global economy. More in China section.

President Ebrahim Raisi of Iran met with Chinese leader Xi Jinping in Beijing today at the start of a three-day trip, as the two countries shored up ties amid their escalating tensions with the U.S. China pledged to import more agricultural products from Iran and cooperate with Iran on Belt and Road projects, Xinhua reported.

Ford confirmed plans to invest $3.5 billion to build a lithium iron phosphate battery plant in Michigan with the aid of Chinese battery giant CATL. The new facility will employ 2,500 people when production begins in 2026 (though the automaker just announced thousands of layoffs elsewhere overnight).

Lured by tax credits, a European EV battery maker mulls moving production to North America.

EU lawmakers vote to ban sale of new gasoline-powered cars from 2035. Details in Energy section.

USDA tapped the first $850 million out of $19.5 billion Congress approved for additional conservation program spending over five years. Details in Policy section.

Mexico attempted to answer U.S. trade officials’ desire for more info regarding a controversial push to ban some GMO corn. More in Trade Policy section.

Former South Carolina Gov. Nikki Haley (R) early on Tuesday announced her presidential campaign. “Get excited! Time for a new generation,” Haley wrote on Twitter. “Let’s do this!” The former United Nations Ambassador becomes the first challenger in the upcoming Republican presidential primary against former President Donald Trump.

We include a graphic in the Politics section that farm-state lawmakers who want more funding for the new farm bill should use to convince GOP leaders it’s pay-back time for the ag sector.

20 million: The number of people from California to Arkansas who are under winter weather alerts ahead of two weather systems expected to cross the U.S. this week.

Equities today: Global stock markets were mixed but mostly higher overnight. In Asia, Japan +0.6%. Hong Kong -0.2%. China +0.3%. India +1%. In Europe, at midday, London +0.4%. Paris +0.6%. Frankfurt +0.5%. The U.S. Dow opened around 100 points lower, then went down over 200 points and is now up around 70 points.

U.S. equities yesterday: The Dow finished with a gain of 376.66 points, 1.11%, at 34,425.93. The Nasdaq rose 173.67 points, 1.48%, at 11,891.79. The S&P 500 moved up 46.83 points, 1.14%, at 4,137.29.

Oil prices, a key inflation component, fell on a report that the Biden administration plans to sell more crude oil from the Strategic Petroleum Reserve — but Biden officials said they don’t want to, but Congress is making them do it. The congressionally mandated sale will amount to 26 million barrels of crude, according to people familiar with the matter. The sale is in accordance with a budget mandate enacted in 2015 for the current fiscal year. The Energy Department has sought to stop some of the sales required by the 2015 legislation so that it can refill the emergency reserve, which currently has about 371 million barrels. After this latest release, the reserve will dip to about 345 million barrels. West Texas Intermediate crude futures dropped below $80 a barrel.

Agriculture markets yesterday:

• Corn: March corn futures rose 4 1/2 cents to $6.84 3/4, just below resistance at $6.85 3/4.
• Soy complex: March soybeans rose 1/4 cent to $15.42 3/4 after reaching a 6-month high early in the session. March soymeal rose $4.60 to $504.00 while March soyoil dropped 40 points to 60.14 cents.
• Wheat: March SRW futures rose 6 cents to $7.92. March HRW rose 3 1/4 cents to 912 1/4, while March spring wheat rose 1/2 cent to settle at $9.30 3/4.
• Cotton: March cotton rose 27 points to 85.54, ending the session above the 10-day moving average.
• Cattle: April live cattle rose $1.15 to $165.10, nearer the session high and hit a contract high. March feeder cattle gained 80 cents to $187.20 and near mid-range.
• Hogs: April lean hogs closed up $3.025 at $86.35 today and near the session high.
  

Ag markets today: Two-sided trade was seen in the grain and soy markets overnight, with corn and wheat mildly firmer and soybeans weaker early this morning. As of 7:30 a.m. ET, corn futures were trading 1 to 2 cents higher, soybeans were mostly 1 to 4 cents lower and wheat futures fractionally to 2 cents higher. Front-month crude oil futures were around $1.25 lower, and the U.S. dollar index was down nearly 400 points this morning.

Technical viewpoints from Jim Wyckoff:

On tap today:

• U.S. Consumer Price Index for January is expected to increase 0.4% from one month earlier and 6.2% from one year earlier. Excluding food and energy, the CPI is forecast to rise 0.3% and 5.5%. (8:30 a.m. ET) UPDATE: See report results in item below.
• President Biden will leave the White House for the Washington Hilton, where he will address the National Association of Counties. 12:45 p.m. ET.
• Federal Reserve speakers: Dallas’s Lorie Logan on the economic outlook at 11 a.m. ET, Philadelphia’s Patrick Harker on the economic outlook at 1 p.m. ET, and New York’s John Williams to the New York Bankers Association at 2:05 p.m. ET.

U.S. annual consumer prices rose 6.4% in January versus the year before, the lowest since October 2021, versus expectations of 6.2%. It marked a slight step down from the 6.5% annual rate notched in December, and a drop from last summer’s peak of 9.1%. The report showed January prices rose 0.5% compared to the previous month, the most in three months.

While food inflation eased slightly and the cost of used cars declined further, shelter and energy prices grew faster. Compared to December, the CPI rose 0.5%, the most in three months.

A slowdown was seen in food prices (10.1% vs 10.4%) while cost of used cars and trucks continued to decline (-11.6% vs -8.8%). In contrast, the cost of shelter increased faster (7.9% vs 7.5%) as well as energy (8.7% vs 7.3%), with gasoline prices rising 1.5%, reversing from a 1.5% decline in December. Meanwhile, both fuel oil (27.7% vs 41.5%) and electricity prices slowed (11.9% vs 14.3%).

U.S. core consumer prices, which exclude volatile items such as food and energy, went up by 0.4% from a month earlier, the same pace as in the prior month and in line with market estimates. Year-on-year, core consumer prices advanced 5.6% in January, slowing from a 5.7% increase in December, but slightly above market forecasts of a 5.5% rise. This core measure of inflation is showing that consumers are still briskly spending on things like cars, holiday travel and restaurants. “

Upshot: Although inflation has shown signs of peaking at 9.1% in June last year, it remains more than three times above the Fed’s 2% target and continues to point to a broad-based advance on the general price level, particularly services and housing.

“The moral of the story is that inflation is not cooling as rapidly as the Fed would like, especially core inflation,” said Diane Swonk, chief economist at KPMG, referring to a narrower inflation measure that strips out more volatile sectors. “And that is something that is just going to affirm their commitment to continue raising rates at least two times.”

Note: The January data includes annual updates to historical seasonal factors, which affect the one-month price change. Using the new seasonal adjustments, both overall and core inflation cooled less toward the end of 2022 than previously thought. The new data also reflects an update to the weights of goods and services in the spending basket to capture changes in consumer preference. The Labor Department previously updated these every two years but starting with Tuesday’s release will revise them annually.

Market impact: A 25 basis point hike in June has now taken the lead in Fed funds futures over a steady rate decision — 46% odds for 25 bp vs 42.7% for steady rate decision. One week ago steady was at 49%, 25 bp at 36%. CPI data definitely altered market thinking.

The average monthly payment for a new car has soared to a record $777, nearly doubling from late 2019, according to Cox Automotive. That’s almost a sixth of the median after-tax income. Electric vehicles are making the affordability crisis even worse, costing about 25% more than the average car.

Federal Reserve Governor Michelle Bowman said she expects the Fed will need to hold interest rates higher for “some time” to bring supply and demand back into a better balance and achieve the central bank’s target 2% inflation rate. Speaking to attendees at an American Bankers Association conference, Bowman did not specify what she thought the peak rate should be, but said she believes a soft landing is still possible.

Japan’s economy resumed modest growth in the October-December period thanks to a revival in tourism. The world’s third-largest economy after the U.S. and China grew 0.2% in the three months to December from the previous quarter, or 0.6% on an annualized basis. For all of 2022, real growth was 1.1%, but the economy was still slightly smaller than it had been in the pre-Covid-19 years of 2017 through 2019 because of a big drop in 2020 caused by the pandemic.

Market perspectives:

• Outside markets: The U.S. dollar index was weaker ahead of the CPI report, with the euro and British pound firmer against the U.S. currency. The yield on the 10-year U.S. Treasury note was slightly weaker, around 3.69%, with a mixed tone in global government bond yields. Crude oil remained under pressure, with U.S. crude around $79.15 per barrel and Brent around $85.85 per barrel. Gold was firmer ahead of U.S. inflation data, trading around $1,872 per troy ounce, with silver weaker around $21.83 per troy ounce.

• Freeport LNG seeks regulatory approval for initial restart. The Freeport LNG plant in Texas on Monday asked the Federal Energy Regulatory Commission to approve the first phase of a full commercial restart as they work to resume operations halted since a June 2022 explosion.

• 10,659: Average weekly shipments of petroleum and petroleum products carried by North American railroads through early February, a 13% increase over 2022, according to the Association of American Railroads.

• Ag trade: Japan is seeking 76,203 MT of milling wheat in its weekly tender.

• NWS weather outlook: A rapidly developing low pressure system could bring blizzard conditions from the northern Plains to the upper Great Lakes Tuesday night into Wednesday as high winds and some thunderstorms spread across the southern Plains... ...Another low-pressure system is expected to bring more heavy mountain snows into the Four Corners Tuesday night and Wednesday... ...The same low pressure system will likely bring strong to severe thunderstorms across the mid-South as moderate snow and gusty winds sweep across the central Plains.

Items in Pro Farmer’s First Thing Today include:

• Varied grain price tone overnight
• Consultant lowers Brazil corn crop, Argentine soybeans and corn
• France raises wheat planted area
• Indian trade body trims cotton production estimate
• Cash cattle climbing
• Cash hog rally picking up steam

— Summary: Russia has a major offensive underway in Bakhmut. The eastern Ukrainian city of Bakhmut was facing heavy artillery fire as the NATO chief backed reports from local officials that a major new Russian offensive had begun, days before the first anniversary of Moscow’s invasion on Feb. 24. Bakhmut is a prime objective for Russian President Vladimir Putin, and its capture would give Russia a new foothold in the industrial Donetsk region and a rare victory after months of setbacks.

• Moldovan President Maia Sandu accused Russia of plotting to overthrow her pro-European Union government. The claim, first made by Ukraine’s President Volodymyr Zelenskyy last week, came days after Sandu’s prime minister resigned. She has since replaced him with another pro-EU leader.

— Clawing back unspent funds appropriated in Covid-19 emergency bills is also a top priority for House GOP conservatives. Rep. Andy Harris (R-Md.), according to Bloomberg, said there may be “hundreds of billions of dollars of unspent Covid money. “The conservative members want to break this parity between defense and nondefense,” Harris said. “It’s an artificial parity.”

Harris is the senior member of the Freedom Caucus appropriators and is the new chairman of the Agriculture/FDA Subcommittee, where he also aims to cut the Food and Drug Administration’s budget, block Chinese purchases of U.S. agricultural land, and impose stricter work requirements for nutrition aid. A measure to ban Chinese purchases of U.S. agricultural land, previously proposed as an amendment to House appropriations bills by Rep. Dan Newhouse (R-Wash.), “will almost certainly be in the draft bill,” Harris said. Harris also said he’ll aim to reduce Supplemental Nutrition Assistance Program (food stamp) funding to its pre-Covid levels, which would be a roughly 50% cut.

— USDA starts tapping $19.5 billion Congress approved last year for additional conservation spending over five years. USDA on Monday announced $850 million under several conservation programs — for the Environmental Quality Incentives Program (EQIP), Conservation Stewardship Program (CSP), Agricultural Conservation Easement Program (ACEP) and Regional Conservation Partnership Program (RCPP). The extra funds, provided via the Inflation Reduction Act (IRA), will help the oversubscribed programs, USDA said. Link to USDA announcement.

Background: The IRA included additional funds totaling $8.45 billion for EQIP, $4.95 billion for RCPP, $3.25 billion for CSP and $1.4 billion for ACEP. This marks the first installment of the extra funds which will “build rapidly over four years,” USDA said. The funds are aimed at providing what USDA said is “direct climate mitigation benefits” and expanding financial and technical assistance to producers. USDA’s Natural Resources Conservation Service (NRCS) will direct the funding and USDA said the agency is “working to support department-wide work on Measurement, Monitoring, Reporting and Verification (MMRV).” USDA also noted the extra funding will “support other environmental co-benefits, including — among other things — water conservation, wildlife habitat improvements, and reducing runoff.”

Applications for EQIP and CSP are accepted year-round, but USDA said that those interested in the additional funding for those two programs should apply by the ranking dates in their state to be considered for funding which is provided via a competitive process.

For ACEP Agricultural Land Easements or Wetland Reserve Easements, applications must be submitted by March 17 for the first funding round.

For RCPP, NRCS is expected to announce the signup opportunity in early spring. USDA said other actions at the state level will be announced for fiscal year 2023.

USDA Secretary Tom Vilsack also announced a WaterSMART Initiative to spend $25 million in three new and 37 existing priority areas to help farmers and ranchers conserve water and build drought resilience in arid regions.

Perspective: Congress said the $19.5 billion in conservation funding was to prioritize practices that reduce greenhouse gas emissions and increase climate resiliency. USDA spends around $5 billion a year on conservation programs so the additional funding would allow a huge boost.

— ERP, CFAP 2 payment updates. Payments under the Emergency Relief Program (ERP) and Coronavirus Food Assistance Program 2 (CFAP 2) moved up as of Feb. 12, with total ERP payments at $7.39 billion, up from $7.38 billion the prior week. The total includes $6.28 billion for non-specialty crops ($6.27 billion prior) and $1.11 billion for specialty crops (essentially unchanged).

Total CFAP 2 payments are at $19.42 billion, up from $19.37 billion the prior week. The total includes $14.52 billion in original CFAP 2 payments ($14.48 billion prior) and $4.91 billion in top-up payments ($4.89 billion prior). There was essentially no change in CFAP 1 payments.

The ERP payments are being made under Phase 1 of the program while USDA is still not reporting any payments under the Phase 2 that has been criticized as being overly cumbersome.

— House Speaker McCarthy will speak at today’s farm bill listening session in Tulare, Calif., according to an announcement from Rep. Glenn “GT” Thompson (R-Pa.), chair of the House Ag Committee. McCarthy (R-Calif.) will be joined by lawmakers who are active in agriculture, including Reps. Doug LaMalfa (R-Calif.) and Jimmy Panetta (D-Calif.). McCarthy’s support and influence will be key for Thompson and other members of his committee as they seek to usher the farm bill through the House by Thompson’s self-posed deadline of “by September.”

— President Joe Biden has decided to name Fed Vice Chair Lael Brainard as his top economic adviser to head the National Economic Council with an announcement coming as soon as today (Feb. 14). Brainard will replace outgoing NEC Director Brian Deese. Brainard’s move to the White House would create an opening at the central bank. The move could position Brainard to be the next in line for Treasury secretary if Biden wins another term and Janet Yellen departs, some observers speculate. Brainard, a Democrat with dovish economic views, is a veteran of Treasury Department during the Obama administration.

Meanwhile, Jared Bernstein, a member of the Council of Economic Advisers, is considered likely to be named its chair, replacing Cecilia Rouse, who is stepping down.

— Biden plans for permanent NHTSA chief. President Joe Biden intends to nominate Ann Carlson, a former environmental law professor, to lead the federal regulator charged with keeping the country’s roads safe. Carlson has been the agency’s interim chief since September 2022 and must still be confirmed by the Senate before formally taking the upgraded role. She is a former faculty member at the UCLA School of Law, where she served as a professor of environmental law.

— President Biden removed Brett Blanton, architect of the Capitol, amid allegations of wrongdoing, including misleading investigators and impersonating a police officer. Link for details.

— Japan’s government nominated Kazuo Ueda to helm the central bank in a move some observers say will likely pave the way for a gradual paring back of stimulus. Ueda is known as a soft-spoken pragmatic academic, but was also a former member of the central bank’s policy board and kept close ties to the BOJ since leaving the position in 2005. Many previously thought that the top spot at the BOJ would go to a seasoned central banker like Deputy Governor Masayoshi Amamiya, but the surprise nomination of Ueda could mean that things may be changing in terms of direction. Japanese inflation hit a multi-decade high of 4% in December, which is double the BOJ’s longstanding 2% target. Earlier today, the country’s Q4 annualized GDP growth expanded only 0.6%, which was much less than expected amid slumping business investment.

— U.S. Secretary of State Antony Blinken is reportedly mulling a meeting with Wang Yi, China’s top diplomat, at a security conference later this week. It would be their first face-to-face talks since Beijing ignited an international uproar with an alleged spy balloon that moved across the U.S. mainland. Blinken and Wang would meet at the Munich Security Conference, which runs Feb. 17 to Feb. 19, provided both sides agree.

— China’s recovery after years of Covid-19 lockdowns will likely look a lot different from previous ones. And for many parts of the world, economists warn, it could be less potent than governments and businesses hope. China has historically relied on government stimulus and heavy investment to power itself out of slumps. That mix helped yank the global economy out of the doldrums after the 2008 financial crisis. This time, China is deeply in debt, its housing market is in distress, and much of the infrastructure the country needs is already built, the Wall Street Journal reports (link). China’s latest revival will be led by consumers, after public-health restrictions and travel bans were abruptly dismantled. Official data suggest the strongest growth will come from service industries such as restaurants, bars and travel. That means that while an accelerating China is good news for fragile global growth, the direct effects of its revival will likely be less pronounced elsewhere than in the stimulus-led expansions of the past.

— Iran’s Ebrahim Raisi brought a big entourage to Beijing this week on the first visit by an Iranian president to China in 20 years. With Iran’s economy reeling from western sanctions over its nuclear program, its shipment of drones to Russia for the war in Ukraine, and its brutal crackdown on protesters following the in-custody death of Mahsa Amini, Tehran hopes to foster economic growth by deepening trade ties with China. Raisi’s main goal is to implement a sweeping 25-year cooperation agreement the two countries signed in 2021 that includes economic and security cooperation. He met with Chinese President Xi Jinping, and talks about reviving the Iranian nuclear deal were expected. The countries have grown closer in recent years.

Chinese imports of Iranian oil climbed to a record 1.2 million barrels a day on average in December, up more than 130% from a year earlier, according to a report last month by London-based energy and shipping data firm Vortexa.

Xi told his Iranian counterpart that China will support Iran in safeguarding its interests to properly resolve the Iranian nuclear issue, according to China’s state-run Xinhua News Agency. China was part of a group of nations that negotiated the 2015 deal alongside the U.S. with Iran.

China also pledged to import more agricultural products from Iran and cooperate with Iran on Belt and Road projects, Xinhua reported.

— After nearly seven years of companies consistently directing money to China, they’re pulling capital out of the country. Over the last six months, foreign direct investment into China has gone negative for the first time since 2016. Link for more via Forbes.

— China to strengthen regulation of hog production. Part of China’s No. 1 document, the blueprint for agricultural policy, includes strengthening regulation of its hog production capacity, mainly for breeding sows. Details of the new regulations are lacking, though following the African swine fever outbreak, China has pushed more production to major hog farms and tried to eliminate smaller backyard herds.

— AMLO’s government softened Mexico’s stance on genetically modified U.S. corn, according to a decree, yielding to pressure from the Biden administration. It’s scrapping a deadline to ban it for animals and manufactured products, but will still prohibit importation for flour and tortillas, and glyphosate, a commonly used pesticide.

The phasing out will depend on supply and establishing working groups with domestic and foreign businesses for an orderly transition.

Most U.S. corn exports to Mexico are used for livestock feed.

Mexico comments. The new decree “does not represent any impact on trade or imports, among other reasons because Mexico is greatly self-sufficient in the production of white corn free from transgenics,” Mexico’s economy ministry said. Mexico will not grant new authorizations for GM corn for human consumption, the decree said. Health authority COFEPRIS, however, may grant authorizations for GM corn to be used as animal feed or industrial use for human food until a substitute is achieved. The decree, which stated that it will go into effect on Tuesday, said it is in accordance with Mexico’s food self-sufficiency policies and protection of the health of the population and the environment.

The National Corn Growers Association has pushed for an arbitration panel under the U.S.-Mexico-Canada agreement on trade to settle the dispute, saying Mexico’s plans violate the deal. Last month, the group signaled there was no room for compromise, saying a ban would “deliver a blow to American farmers and exacerbate current food insecurity in Mexico.”

Bottom line: Mexico maintains the new decree does not violate its commitments under the USMCA as it does not affect trade and imports as Mexico is self-sufficient in white corn used for food. The decree on halting imports of GMO corn also does not apply to corn imported for industrial use. The decree maintains Mexico’s plans to revoke authorizations and permits to import, produce and distribute glyphosate with a transition period in effect until March 31, 2024. The U.S. has asked Mexico to clarify its position on GMO corn and Politico reported that the Office of the U.S. Trade Representative (USTR) said was reviewing the decree and that it does not meet the U.S. request for an explanation of their plans by Feb. 14.

— Biden restarts $10 billion tax credit for clean energy makers. The Biden administration is restarting a popular tax credit for manufacturers of solar panels, wind turbines, fuel cells and other clean energy equipment after getting a $10 billion infusion from the climate-and-tax law.

— Ford Motor is investing $3.5 billion to build a battery plant 100 miles west of Detroit. The Wall Street Journal reports (link) that the investment is part of the company’s goal of producing 2 million electric vehicles a year globally by the end of 2026. Ford considered sites for the factory in Mexico and Canada but settled on Michigan in part because of new federal subsidies available under the Inflation Reduction Act (IRA). The factory will be run by a wholly owned Ford subsidiary and will produce lithium-iron-phosphate battery cells using technology and expertise provided by China’s Contemporary Amperex Technology. The batteries have less energy density than nickel-and-cobalt-based batteries. But they are becoming increasingly popular in the EV sector as the price of nickel-and-cobalt batteries continues to rise and as auto makers find new ways of boosting lithium-iron-phosphate batteries’ driving range.

Meanwhile, Toyota Motor’s next chief executive wants to accelerate development of parts and manufacturing methods optimized for electric vehicles. “We need to drastically change how we do business,” said Koji Sato, the incoming chief executive of Toyota, on plans to accelerate the auto maker’s development of electric vehicles.

— Lured by tax credits, a European EV battery maker mulls moving production to North America. Peter Carlsson, the CEO of Sweden’s Northvolt, told Bloomberg (link) that the “really, really big” subsidies offered by the Inflation Reduction Act are forcing it to consider postponing construction of a German factory in favor of a move across the Atlantic.

— EU lawmakers vote to ban sale of new gasoline-powered cars from 2035. European Union lawmakers approved a law that will effectively ban the sale of new gasoline- and diesel-powered cars in the bloc from 2035, as the block accelerates the transition to electric vehicles and a move observers say will likely further fuel a global shift that is already having a huge impact on investment and product development by car manufacturers and their suppliers.

The law is set to require new cars and vans to have significantly lower carbon emissions by 2030 and zero emissions by 2035, a requirement that industry groups say is expected to result in an end to the sale of new vehicles that use traditional combustion engines, and accelerate the shift to EVs.

The deal left the door open for the possibility that vehicles that run exclusively on carbon-neutral fuels could be sold after 2035. It also included a review clause that requires the European Commission, the EU’s executive body, to assess progress toward the zero-emission targets in 2026.

Europe is now the second-largest market for electric vehicles, after China, with EVs accounting for more than 20% of all new cars sold last year, data from ev-volumes.com shows.

— Global spending on electric vehicles is surging. According to a new report (link) published by BloombergNEF on investment in the energy transition, annual spending on passenger EVs hit $388 billion in 2022, up 53% from the year before. With the 2022 tally included, the total value of electric vehicles sold to date in the passenger vehicle segment has now crossed $1 trillion.

— Argentina announces price controls for beef cuts. Argentina’s economy ministry announced a price control program to bring down the cost of popular beef cuts amid ongoing high inflation. An economy ministry official said some popular cuts of meat would see prices drop around 30%. The ministry said the program has been applied to seven different types of meat and will be in effect until March 31, when a smaller price cut of 3.2% will come into play until June 30.

— Summary:

• Global Covid-19 cases at 673,103,630 with 6,855,305 deaths.
• U.S. case count is at 102,870,375 with 1,114,546 deaths.
• Johns Hopkins University Coronavirus Resource Center says there have been 670,306,507 doses administered, 269,208,743 have received at least one vaccine, or 81.71% of the U.S. population.

— Covid tracker coming to an end March 10. Johns Hopkins University has operated one of the most prominent resources for tracking Covid-19 case counts and deaths across the world. After more than three years, the university will stop updating its tracker on March 10 as the country has moved into a different stage of the pandemic with a different data flow.

— Nikki Haley enters GOP presidential race. The former South Carolina governor and United Nations ambassador said she is entering the 2024 Republican presidential nomination race in a move that puts her in direct competition with her one-time boss, former President Donald Trump. “It’s time for a new generation of leadership to rediscover fiscal responsibility, secure our border, and strengthen our country, our pride and our purpose,” Haley said in an announcement video released a day before she is scheduled to give a formal campaign launch speech in Charleston, S.C.

— Here’s a chart Republican farm-state lawmakers should use to get more new farm bill funding:

— 11: The number of states considering farm “right to repair” laws, which would allow farmers to repair their own equipment without having to pay manufacturers and lose valuable time. Link for details via the Associated Press.

— Valentine’s Day spending by consumers is forecast by the National Retail Federation and Prosper Insights to rise 8.4% to $25.9 billion in 2023, to become one of the highest spending years on record. The top gifts expected to be doled out include candy (57% of respondents), greeting cards (40%), flowers (37%), an evening out (32%), jewelry (21%), gift cards (20%) and clothing (19%).

— An attempt by the Indian government to rebrand Valentine’s Day as “Cow Hug Day” backfired but far-right Hindu nationalist groups still warned couples against celebrating. In a statement last week, the Animal Welfare Board of India urged citizens to mark Feb. 14 by hugging a cow to promote Hindu values, which they deemed to be under threat from Western culture. It didn’t take long for the jokes and memes to flood social media: One TV anchor was filmed trying to hug cows “which appeared to rebuke his advances,” observed Rhea Mogul on CNN, as he noted that consent was important.

— Super Bowl LVII was the third-most-watched TV show of all time, preliminary data showed. Betting set a record, but the high final score meant lackluster profits for sports-betting companies.

WASDE | Crop Production | USDA weekly reports | Crop Progress | Food prices | Farm income | Export Sales weekly | ERP dashboard | California phase-out of gas-powered vehicles | RFS | IRA: Biofuels | IRA: Ag | Student loan forgiveness | Russia/Ukraine war, lessons learned | Election predictions: Split-ticket | Congress to-do list | SCOTUS on WOTUS | SCOTUS on Prop 12 | New farm bill primer | China outlook | Omnibus spending package |