U.S. Importers Experiencing Delays at Major Pacific Ports

Lawmaker proposes 60% tax on land purchases by U.S. adversaries

Aside from the FOMC decision on June 14, the rest of the global economy also looks busy this week. The European Central Bank is likely to keep raising rates, the Bank of Japan may remain on hold, and Chinese monetary officials could avoid adding stimulus for now.

Europe’s best strategy to avoid a winter energy crisis could be to stash gas in Ukraine, amid warnings from Germany of an industry shutdown.

China’s property sector is facing the likelihood of an “L-shaped” recovery, according to Goldman Sachs economists.

China has a big role in Iranian drone supply chain for Russia. See Russia/Ukraine section.

Americans are accumulating a mountain of credit card debt, reaching a record $988 billion, up 17% from the previous year. Details below.

Propane prices are at their lowest start-of-summer levels since the Covid-19 lockdown three years ago.

Financial Times reports that the U.S. is considering the release of Iranian oil tanker Suez Rajan, which has been anchored off the coast of Texas since being seized.

Unionized dockworkers and employers at West Coast ports were close to reaching an agreement last month, but a roadblock emerged in the form of a final issue: wages. As a result, U.S. importers are now experiencing delays at major Pacific gateways from Seattle to Southern California, with job actions erupting at various ports. These disruptions have significant implications for the American economy. Though the job actions have been relatively limited, especially compared to the 2014 contract negotiation cycle that cost retailers millions in lost sales, the two parties remain far apart on wage proposals. The longshore union initially aimed to double worker wages over six years, but a compromise is yet to be reached. The U.S. Chamber of Commerce has requested that the Biden administration appoint an independent mediator to facilitate the negotiations. More in Markets section.

Canada’s longshore union plans to hold a vote to authorize a strike at British Columbia ports amid ongoing contract negotiations.

Major U.S. freight railroads have reached a series of labor-friendly agreements with several unions, addressing concerns like paid sick leave and predictable shifts. Unlike previous tumultuous negotiations, these deals aim to improve worker morale and attract new talent. More in Markets section.

Russia remains dissatisfied with Black Sea grain deal. Details in Russia & Ukraine section.

OMB is nearing the end of its review of the EPA’s final rule for volume requirements under the Renewable Fuel Standard for 2023 and beyond. More in Energy section.

Department of Energy has purchased 3 million barrels of crude oil for the Strategic Petroleum Reserve (SPR) for approximately $73 per barrel. Details below.

How Tractor Supply’s ‘inflation chickens’ are ruling the backyard roost. When inflation drove the price of eggs up this year, some consumers took the issue into their own hands by raising chickens. Tractor Supply, America’s largest seller of live poultry, could top the all-time record it set in 2020, when it cleared 11 million birds, according to a Forbes’ article. Details in Livestock and Food section.

Former President Trump is due to be arraigned on Tuesday in Miami, facing 37 federal felony charges in connection to his handling of classified documents after leaving office. The indictment reveals that 31 documents are central to the case, including 21 marked “Top Secret” and nine marked “Secret”. One of the documents from 2020 concerned the nuclear capabilities of a foreign nation. Despite the charges, Trump called them a “political hit job” while addressing Georgia Republicans, blaming the Biden administration for the indictment. He also pledged to continue his run for the presidency in 2024 even if convicted.

“If even half of it is true, he’s toast.” — William Barr, an attorney general under former President Donald Trump, says the charges against his ex-boss over handling of classified government documents seem “very, very damning.” Trump is set to be arraigned tomorrow in a Miami federal court — and then will host the first fund-raiser for his 2024 campaign.

Four young children have been found alive after surviving a plane crash in the Amazon more than a month ago that killed their mother.

A tanker fire caused part of Interstate 95 in northeast Philadelphia to collapse on Sunday. No injuries or deaths have been reported yet, but officials have not been able to reach a tanker truck trapped under the rubble, according to NBC News. The stretch of the highway that connects New York City and Philadelphia, and is a key corridor for commuters and goods, could take “months” to repair, Pennsylvania Gov. Josh Shapiro said. He noted that the roadway “supports our economy and plays an important role in folks’ everyday lives.”

Equities today: Asian stock markets were mixed overnight, and European stock indexes were mostly firmer. U.S. Dow opened up around 60 points. In Asia, Japan +0.5%. Hong Kong +0.1%. China -0.1%. India +0.2%. In Europe, at midday, London flat. Paris +0.7%. Frankfurt +0.6%.

U.S. equities Friday: All three major indices registered modest gains on Friday after dipping into or near negative territory around midday. All three notched gains for the week, with the S&P finishing the week up 0.4% and registering its seventh winning week. The Dow was up 0.3% while the Nasdaq advanced 0.1%.

On Friday, the Dow rose 43.17 points, 0.13%, at 33,876.78. The Nasdaq gained 20.62 points, 0.16%, at 13,259.14. The S&P 500 was up 4.93 points, 0.11%, at 4,298.86.

At $147.5 billion, cash inflows to ETFs are running at their slowest pace since 2019, when the market was significantly smaller, according to FactSet data.

Agriculture markets yesterday:

• Corn: July corn futures fell 6 cents on the session to $6.04 1/4, falling 4 3/4 cents on the week. December corn futures fell 2 1/2 cents Friday to $5.30 1/2, bringing the week’s loss to 10 3/4 cents.
• Soy complex: July soybeans rose 23 1/4 cents to $13.86 1/2, marking the highest close since May 16 and a 34-cent gain on the week. November bean futures gained 15 1/4 cents to $12.04 1/4. July meal fell $6.80 to $397.20 and July soyoil rose 209 points to 54.59 cents.
• Wheat: July SRW wheat rose 4 cents to $6.30 1/4, near the session high and for the week up 11 1/4 cents. July HRW wheat fell 7 cents to $7.97 3/4, near mid-range and for the week down 14 1/2 cents. July spring wheat futures fell 4 cents to $8.11 3/4 but rose 4 cents on the week.
• Cotton: July cotton futures fell 27 points on the session to 84.04 cents, bringing the weekly loss to 201 points.
• Cattle: Expiring June live cattle futures fell 55 cents to $178.225 Friday, while most-active August dropped 40 cents to $171.85. That represented a weekly drop of $1.05. August feeder futures posted a strong late surge and ended the week at $239.00, which marked a daily rise of 35 cents but fell $2.90 on the week.
• Hogs: Expiring June hog futures edged up 20 cents to $87.875, while August lean hog futures rose $1.525 to $83.95, near the daily high and for the week up $1.65.
  

Ag markets today: Corn futures posted double-digit gains overnight amid increased weather/crop concerns. Soybeans also traded higher, while wheat has turned mostly firmer. As of 7:30 a.m. ET, corn futures were trading 12 to 13 cents higher, soybeans were 3 to 10 cents higher, SRW wheat was 2 to 3 cents higher, HRW wheat was narrowly mixed and HRS wheat was mostly 3 cents higher. Front-month crude oil futures were more than $1.50 lower, and the U.S. dollar index was down around 125 points this morning.

Market quotes of note:

• Oil prices are a bit lower than when OPEC-plus announced production cuts last weekend, with WTI crude recently down 0.5% at $70.94 a barrel after briefly dipping into the $60’s. And that’s raising the specter of more production cuts down the road. “I believe if we see sub-$70/bbl WTI for an extended period OPEC could once again act for additional cuts,” says Dennis Kissler at BOK Financial, in a research note. “Global demand is working higher but at a slower pace than most analyst had expected ... Near term the technical trend remains bearish with major support for July Nymex crude at the 69.03 area. Near term resistance will be the 73.28 area then 74.60.”
  
• Sevens Report: “Looking forward, we know what can push this market higher: More of the same (evidence of accelerating dis-inflation, not hawkish Fed, solid economic data). Specifically this week, that looks like 1) CPI (and especially Core CPI) solidly under expectations, 2) The Fed pausing rate hikes and markets not believing threats to hike in the future and 3) Solid economic data from Philly Fed, Empire Manufacturing, Retail Sales, Jobless Claims and Industrial Production. But even if we get that outcome from the data and news, the S&P 500 is facing a real valuation constraint. At 4,300, the S&P 500 is now trading at a 19.4X multiple if we use the 2023 S&P 500 EPS estimate of $223, and a 17.4X multiple if we use the 2024 S&P 500 EPS estimate of $247. Those aren’t “best case” scenario multiples, but they aren’t that far off, either, and even with the bullish momentum currently helping stocks ignore any news that doesn’t fit the bullish narrative, it’s hard to see investors pushing the broad averages materially higher from here (any more than 5% or so).”
  
• UBS imposed strict restrictions on Credit Suisse after the Swiss bank completed the takeover of its rival. The measures include a ban on taking on new clients from high-risk countries such as Russia. Credit Suisse’s final years as an independent bank were marred by scandals, which an internal report blamed on a “lackadaisical attitude towards risk.”
  

• China’s property sector is facing the likelihood of an “L-shaped” recovery, according to Goldman Sachs economists. “The ongoing property cycle is different from previous rounds,” Goldman China economists including Lisheng Wang wrote in a note to clients Sunday. While policymakers will likely take steps to support the sector, they aren’t about to apply the scale of measures they did in the past — in part out of recognition about “falling demographic demand.” China’s property sector is facing the likelihood of an “L-shaped” recovery, according to Goldman Sachs economists. “The ongoing property cycle is different from previous rounds,” Goldman China economists including Lisheng Wang wrote in a note to clients Sunday. While policymakers will likely take steps to support the sector, they aren’t about to apply the scale of measures they did in the past - in part out of recognition about “falling demographic demand.”

  
  

On tap today:

• USDA Weekly Grain Export Inspections report, 11 a.m. ET.
• U.S. federal budget deficit is expected to widen to $235.5 billion in May from $66 billion one year earlier. (2 p.m. ET)
• USDA Crop Progress report, 4 p.m. ET.
• President Biden holds a meeting with Jens Stoltenberg, secretary-general of the North Atlantic Treaty Organization, at 3:15 p.m. ET to discuss the upcoming NATO summit.

Americans are accumulating a mountain of credit card debt, reaching a record $988 billion, up 17% from the previous year. This comes to an average of $5,700 per person, as consumers face dwindling purchasing power due to high inflation. The rising figure, approaching the $1 trillion milestone, is causing concern as non-discretionary spending increases and interest rates reach over 20%. This surge in credit card debt is contributing to the overall U.S. household debt, which exceeded $17 trillion in the first quarter.

Former Treasury Secretary Lawrence Summers recently commented on the U.S. economy, describing it as “very, very hot,” albeit not as strong as it was six to 12 months ago. He stated that the U.S. is currently experiencing an underlying inflation rate of 4.5-5%. Summers participated in the Caixin Asia New Vision Forum in Singapore through a video link.

Summers mentioned that soft landings tend to be more wishful thinking rather than reality, and highlighted potential pockets of distress in commercial real estate. He also emphasized the importance of stronger U.S./China ties, advocating for greater cooperation on issues such as climate change and debt diplomacy for low-income countries. Summers believes that the best way to ensure peace is to promote interdependence and intertwining between the two countries, so that both societies are invested in each other’s success.

The Federal Open Market Committee (FOMC) policy makers are expected to maintain the federal-funds rate target at 5% to 5.25% after their meeting June 14. However, they are also expected to emphasize the possibility of future interest-rate increases, a position described as a “hawkish hold.” Despite taking time to assess the impact of previous rate hikes, the Fed’s economic projections indicate slower progress towards reaching its 2% inflation target.

The FOMC will release a revised Summary of Economic Projections, which is expected to show a quarter-percentage-point increase in the projected year-end fed-funds rate. Additionally, the FOMC will likely update other economic projections, with unemployment expected to be lower and inflation higher than previously estimated for the end of 2023.

Some analysts believe that investors are underestimating the chances of a rate hike this week. Futures traders favor a rate hike of at least a quarter percentage-point in July by roughly 2-to-1. For December, the distribution of potential rate outcomes is distributed around the current 5% to 5.25% range, with similar chances for boosts or cuts.

Market perspectives:

• Outside markets: The U.S. dollar index was weaker, with the euro slightly firmer against the greenback. The yield on the 10-year US Treasury note was firmer, trading around 3.74%, with a mixed tone in global government bond yields. Crude oil remains under pressure, with U.S. crude was trading around $68.50 per barrel and Brent around $73.30 per barrel. Gold and silver futures were narrowly mixed ahead of US market action, with gold firmer around $1,977 per troy ounce and silver weaker around $24.29 per barrel.

• Iron ore fell for the first time in nine sessions as Goldman Sachs Group Inc. warned that property-sector weakness would likely be a multiyear growth drag for China’s economy. The steelmaking staple dropped almost 5% in Singapore.

• $12,560: The Baltic Exchange’s estimate of average spot-rate prices for bulk shipping’s largest capesize vessels on June 9, up 36% from the week before on stronger iron ore demand.

• Canadian steel maker Teck Resources, which has already rejected two full takeover bids from Glencore, has now received an offer specifically for its coal business from the Anglo-Swiss commodities giant. Last week, Teck announced it received several offers for its coal unit. While Glencore is still open to pursuing its initial $23 billion proposal for a full merger, it has put forward the offer for Teck’s coal assets as an alternative. The initial proposal included a plan to demerge Glencore’s and Teck’s combined coal assets and create a new company called CoalCo. In Glencore’s alternative bid, CoalCo would be demerged within approximately 12-24 months if an accepted deal closes. Teck is now engaging with Glencore regarding the proposal and continues to evaluate “all actionable, value-accretive proposals” for its coal business.

Coal has proved a contentious issue for investors, particularly for those looking at ESG (environmental, social, governance) factors. While Glencore’s rivals are in the process of divesting from coal, it has opted not to—instead it plans to wind down its coal business and achieve net-zero emissions by 2050.

• Propane prices are at their lowest start-of-summer levels since the Covid-19 lockdown three years ago. A mild winter left an excess supply of heating fuel, and record output from natural gas drillers and oil refiners has counterbalanced record exports. As a result, propane prices in commodity markets have dropped over 50% compared to last year. This makes it a good time to buy propane and propane accessories for grilling and other uses.

• Tensions between employers and unions continue at ports along the U.S. West Coast, though some key terminals have seen improved productivity over the weekend after a week of disruptions. The Pacific Maritime Association (PMA) blames the International Longshore and Warehouse Union (ILWU) for shutting down the port of Seattle on Saturday, an accusation ILWU President Willie Adams denies. Ports of Long Beach and Los Angeles experienced increased productivity during the weekend, which the Marine Exchange of Southern California attributes to container carriers adjusting vessel speeds.

Details: “On the second and third shift yesterday, work slowdowns directed by ILWU officials brought ground operations at marine terminals to a halt, resulting in longshore workers being sent home,” PMA said in a bulletin. “On the first shift today, the ILWU refused to dispatch any longshore workers to container terminals. As a result, the Port of Seattle is currently shut down, leaving American exports sitting idle at the docks.

The U.S. Chamber of Commerce has urged President Biden to appoint an independent mediator to address the ongoing labor dispute, as disruptions could impact the peak shipping season. An agreement in the labor dispute is particularly important for seasonal consumer products like back-to-school items.

Analysts at Sea-Intelligence discussed the pay package of dockworkers, noting that the average full-time port worker earned $211,000 annually in 2022, including benefits like pensions and health care.

• U.S. freight railroads are reshaping their labor relations by striking a series of agreements with various unions in response to past tumultuous contract negotiations that sparked fears of walkouts and led to federal intervention. The labor-friendly deals, reported by WSJ’s Esther Fung (link), are aimed at boosting morale among existing workers and making rail jobs more attractive to outsiders. The improved labor landscape stems from targeted agreements that carriers have made with unions representing employees such as track workers and machinists. The previous broad labor pact did little to resolve employee discontent, as railroads faced complaints from customers and federal officials to improve rail service - issues that have been linked to worker shortages.

• Palm oil near two-year low. Malaysian palm oil futures fell to below MYR 3,320 per tonne, approaching the two-and-a-half-year low of MYR 3,200 touched on May 31 amid evidence of lower demand and strong supply. Early cargo surveyors showed that exports of Malaysian palm oil products fell by 16.7%-17.6% from the previous month in the first ten days of June. The developments were affected by stronger competition from the world’s top producer, Indonesia, as oversupply in its domestic market spurred higher exports. In the meantime, data from the Malaysian Palm Oil Board showed that inventories were at 1.67 million tonnes in the end of May, 12.6% higher than the previous month to mark the first buildup in four months.

• EU deforestation law not seen affecting major Malaysia palm oil exporters. Major Malaysian palm oil exporters, such as Sime Darby Plantation and United Plantations, claim that the European Union (EU) deforestation laws will not impact their exports as they stopped planting on deforested land years ago. Executives from both companies feel that these regulations primarily affect smaller farmers who may struggle with supply chain traceability. Notably, small holders constitute around 40% of the palm oil production area in Indonesia and Malaysia.

• U.S. agribusiness Bunge Ltd. is near a deal to acquire Glencore-backed Viterra, Bloomberg reports, citing people familiar with the matter. It would create a giant capable of competing with the biggest agricultural players. Bunge investors would hold a significant majority in the deal, which may be announced today.

• NWS weather outlook: Multi-day severe thunderstorm and flash flooding threat to continue between the southern Plains and Southeast over the next few days... ...Instances of flash flooding and severe weather possible across parts of the central High Plains and Mid-Atlantic today... ...Triple digit and potentially record-breaking heat expected throughout much of central and southern Texas.

Items in Pro Farmer’s First Thing Today include:

• Corn and beans higher, wheat mostly firmer to open the week
• Limited rainfall, mild temps this week
• Firm cuts EU + UK wheat production forecast
• Bullish cash cattle expectations, but cautious attitudes
• Summer-month hogs maintain premiums to cash index

— Ukraine has reported early progress in its counteroffensive against Russian forces, having recaptured three villages — a claim that Russia has largely confirmed. Analysts predict that a larger assault may be imminent, as much of the military aid provided by the West has not been deployed yet. Success in this counteroffensive is vital for Ukraine to regain territory and to ensure continued military aid and financial support from the U.S. and Europe.

— Bleak prognosis for Russia post-Putin. Two recent essays warn that Russia will suffer the consequences of President Vladimir Putin’s war in Ukraine long after his eventual exit. In Foreign Affairs, the Russia expert Eugene Rumer argued that, in acquiescing to the war, the country’s elite and people were implicated in the conflict. “When Putin does leave power, it is unlikely that Russia’s elites and the general public will wake up and face the legacy of his rule,” he said. In The Guardian, the Russia-focused journalist Peter Pomerantsev wrote that Moscow’s elite lacked any ideas for progress. “Russia claims to be a powerful ‘pole’ in the world to balance the West,” he argued, “but has failed to create a successful political model others would want to join.”

— China’s role in Iranian drone supply chain for Russia. Western researchers have found evidence that China has been supplying Iran with crucial parts for their drone program, despite U.S. efforts to hinder the supply chain. China’s support enables Iran to rapidly build and send drones to Russia. With Iran’s persistent drone use, Ukraine faces challenges in maintaining its air defenses.

— Ukraine claims Polish farmer subsidies exceed WTO commitments. Ukrainian Deputy Economy Minister Taras Kachka argues that the subsidies given to Polish farmers in response to a surge in Ukrainian grain exports breach World Trade Organization (WTO) rules. Kachka made the statement at an International Grains Council conference in London, suggesting that although the issue may seem minor, it could potentially lead to global trade disturbances. The increasing flow of Ukrainian grain and agricultural products has been causing tension with Eastern European countries that share borders with Ukraine.

— Russia remains dissatisfied with Black Sea grain deal. Russia is still not satisfied with how a Black Sea grain deal is being implemented, Deputy Foreign Minister Sergei Vershinin said on Saturday after meeting senior United Nations trade officials a day earlier, TASS news agency reported. Vershinin said, “Barriers to our exports remain.” Russia has threatened to walk away from the deal on July 17 if demands are not met, including the resumption of the transit of ammonia from Russia via Ukrainian territory to Pivdennyi port in Odesa, from where it is exported.

— Europe’s plan to avert another winter energy crisis may involve stashing natural gas in Ukraine. One potential site can store more than four times as much as the largest facility in Germany, and it’s far enough from the front line with Russia to be considered safe. Link to details via Bloomberg.

— Lawmaker proposes 60% tax on land purchases by U.S. adversaries. The House of Representatives’ tax-writing committee chairman, Rep. Jason Smith (R-Mo.), has sponsored a bill that seeks to prevent foreign adversaries, such as China, Russia, Iran, North Korea, Cuba, and Venezuela, from acquiring U.S. agricultural land by imposing a 60% excise tax on their purchases. The measure, co-sponsored by Rep. Beth Van Duyne (R-Texas), is an extension of state and federal efforts to restrict farmland ownership to Americans and U.S. allies, aiming to bolster food and economic security. Link for details.

Foreign entities own 3.1% of the U.S.’ private land (40.8 million acres of agricultural land), with China owning about 0.9% of the total. The Smith-Van Duyne bill also proposes a 10-50% excise tax on purchases by publicly traded companies with up to 50% ownership by disqualified persons.

Texas has already banned Chinese firms’ access to the state power grid, setting a precedent for further restrictions.

— Taiwan deployed aircraft and warships after spotting ten Chinese warplanes crossing the Taiwan Strait’s median line. The island’s defense ministry also claimed that Chinese naval ships had conducted combat patrols. Last week Taiwan identified 37 Chinese aircraft entering its air-defense zone. China has previously said such military activities are aimed at preventing “collusion” between Taiwan and the United States.

— The Biden administration plans to permit certain chip makers like Samsung Electronics and Taiwan Semiconductor Manufacturing to maintain their operations in China without facing U.S. reprisals, extending export-control exemptions granted to them. While some analysts see this move as weakening U.S. export controls and China’s technological progress, industry executives see it as the U.S. authorities’ acknowledgment of the challenges of isolating China in a highly integrated global industry. The decision comes as some foreign businesses express concerns over Washington’s growing interference in their operations.

— The economic recovery in China has been slow, but the country’s central bank Governor Yi Gang expressed confidence that they will achieve their economic growth targets. Yi attributed weak consumer (CPI) and producer (PPI) price inflation to base effects and noted the lag between supply and demand recovery. He stated that domestic production is recovering with policies supporting economic stability, but consumer demand remains weak. Recent data showed a small increase in CPI and a contraction in PPI. Yi expects the CPI to be above 1% by December and said the central bank will work to reduce financing costs, support economic growth, and boost financing support to help China achieve technological self-reliance. Despite these efforts, there’s limited impact the central bank can have due to the lack of confidence among key economic actors. Experts believe that a fiscal boost from Beijing is necessary for economic recovery.

Meanwhile, after years of heavy borrowing, many in China are focused on paying down their debts this year — and the result could be weaker growth for a long time to come, the WSJ reports (link). The world’s No. 2 economy binged for years on credit to finance everything from canyon-spanning bridges to new apartments. Now China finds itself facing a protracted period of what economists call deleveraging — the painful process in which borrowers divert income to pay down debts instead of spending and investing.

— Dept. of Homeland Security (DHS) has updated the Uyghur Forced Labor Prevention Act (UFLPA) Entity List, adding two entities and eight subsidiaries. These additions include Xinjiang Zhongtai Chemical Co. Ltd., Ninestar Corporation, and eight Ninestar Zhuhai-based subsidiaries. These companies are accused of involvement in recruiting, transporting, and using forced labor from persecuted groups in Xinjiang. Products from entities on this list are presumed to be using forced labor, and their goods are banned from being imported into the U.S. No entities have been removed from the list since its original publication in June 2022.

— OMB is nearing the end of its review of the EPA’s final rule for volume requirements under the Renewable Fuel Standard for 2023 and beyond. The Office of Management and Budget (OMB) has scheduled 10 meetings to discuss the final rule, resulting in consultations with 35 different companies/groups — significantly more than the 15 meetings held for the proposed rule in late 2022. EPA has promised to finalize the plan by June 14, with an announcement expected shortly after, likely yet this week.

Recent reports indicate that the EPA may have decided to remove provisions relating to awarding renewable credits for electricity generation from renewable sources that power electric vehicles (EVs). If true, attention will be on EPA’s guidance regarding the timeline for regulations in this area.

Biodiesel and renewable diesel stakeholders will also be looking to see if the EPA has increased volume requirements for these fuels in the final plan, as previous increases have often been met with disappointment.

— The Department of Energy (DOE) has purchased 3 million barrels of crude oil for the Strategic Petroleum Reserve (SPR) for approximately $73 per barrel. The oil will be delivered to the Big Hill SPR site between Aug.1-31. Ten companies submitted 30 proposals, with five companies winning the bids. Additionally, the DOE announced a new solicitation to purchase around 3.1 million barrels of crude oil for the Big Hill SPR site in September, with offers due by June 20 and the announcement of successful offers by June 30.

— The Financial Times reports that the U.S. is considering the release of Iranian oil tanker Suez Rajan, which has been anchored off the coast of Texas since being seized by the Department of Justice back in April. The seizure occurred as the vessel was en route to China and led to Iran capturing a U.S. ship in retaliation. With the U.S. and allies imposing sanctions on Iran’s oil exports due to concerns over their nuclear program, the presence of the Suez Rajan off U.S. shores may signal an agreement on criminal penalties between the U.S. gov’t and the tanker operators and owners. The ship is reportedly carrying around 800,000 barrels of crude oil valued at $56 million. The U.S. Department of Justice and Treasury’s Office of Foreign Assets Control have not commented on the matter.

— Tesla’s known for its sleek cars but it’s the company’s Superchargers, which now cover North America, Asia, Europe and the Middle East, that are its most strategic product. Its Magic Dock allows other EVs to use the network without needing to carry an adapter. Partnerships with Ford and GM will also allow customers to buy a Tesla-made adapter to access more than 12,000 Superchargers starting 2024. The deals may bring in as much as $3 billion by 2030, according to Piper Sandler, providing an ongoing stream of revenue.

— Why America isn’t ready for the EV takeover. The adoption of electric vehicles represents the biggest shift in our energy and transportation systems in more than a century — but it’s also the biggest shift in consumer electronics since the debut of the iPhone. On both counts, progress is accelerating in the U.S. And on both counts, we are far from where we need to be. The WSJ’s Christopher Mims describes (link) how much more needs to be done for EV drivers to have a consistent and satisfying experience on par with buying a gasoline vehicle.

— Solar energy will power California’s $100 billion electric bullet train, the country’s most ambitious and expensive infrastructure project connecting Los Angeles and San Francisco. The California High-Speed Rail Authority will own and operate a $200 million utility-scale system that it aims to have ready to power trains by 2030, the targeted opening date of the initial segment. Link for details.

— How Tractor Supply’s ‘inflation chickens’ are ruling the backyard roost. When inflation drove the price of eggs up this year, some consumers took the issue into their own hands by raising chickens. Tractor Supply, America’s largest seller of live poultry, could top the all-time record it set in 2020, when it cleared 11 million birds, according to a Forbes’ article (link).

Tractor Supply has experienced a significant increase in the sale of live poultry, with a 60% rise in foot traffic in the category over the last five years, selling 50 million birds in that time. Factors such as inflation, with egg prices increasing, and people migrating from big cities have contributed to the demand. Good egg-laying hens can produce 250-300 eggs a year, making them an attractive alternative for those looking to avoid high egg prices.

Millennials, who have moved out of big cities during the pandemic, are among Tractor Supply’s best new customers, often investing in backyard hobbies like raising chickens and gardening. People generally start with 4-6 birds, but the average customer eventually has around 14.

While the revenue from selling chicks might not be substantial, Tractor Supply gains additional income from related purchases like brooders, food and water dispensers, feed, and coops, turning the poultry business into a large part of their overall operation.

— Donald Trump is broadly holding on to his base as he heads to court Tuesday. About three-quarters of likely GOP primary voters said the case is politically motivated, a CBS News/YouGov poll showed.

— Biden’s re-election campaign is targeting North Carolina as a top state to try to flip in 2024. Yet for all the reasons Democrats feel encouraged by their chances in the state, they see an uphill fight. Link for more.

— Philanthropist George Soros is set to transfer control of his $25 billion enterprise to his son, Alex, who is 37 years old. George Soros, 92, is known for his significant contributions to Democratic causes in the U.S., which have made him a target of right-wingers. In an interview with the Wall Street Journal, Alex Soros described himself as “more political” than his father and expressed concern about Donald Trump’s potential bid to retake the presidency. As a result, he suggested that he may become heavily involved in efforts to defeat Trump in the upcoming election.

— House Republicans are returning to Washington, following a week of turmoil when conservative rebels halted floor action and blocked votes on GOP priorities, raising questions about Speaker Kevin McCarthy’s (R-Calif.) ability to lead his party. Republican leaders have planned votes on non-controversial bills for Monday evening, with a greater challenge planned for Tuesday when they hope to pass the four bills that were blocked last week. McCarthy’s optimism drives this move, as he hopes to gain the hardliners’ trust in time for the votes. But the conservative agitators have not indicated any intention to end the standoff or stated their specific demands.

This tense situation comes at a time when the Republican Party has been destabilized by last week’s indictments of former President Trump. Some McCarthy allies are asking the conservative rebels to cease their floor blockade to unite against President Biden and the Democrats.

While the conservative holdouts blocked four separate bills last week, their concerns lie primarily with McCarthy’s handling of the debt limit deal he struck with Biden. They want the Speaker to take a stronger stance in future battles, especially in negotiations over government funding to prevent a shutdown at the end of September.

McCarthy remains confident and unafraid of the conflict, telling reporters last week, “I always think tension only makes you stronger.” However, it remains to be seen if the conservative group will end their protest or continue to block GOP priorities, particularly with no concrete demands presented thus far.

— Young and beginning farmers could tap $100 million a year in USDA funding to acquire land, secure clear titles, and receive training under a bipartisan bill filed in the House. Link for details.

— On Sunday, a section of Interstate 95 in Philadelphia collapsed after a tanker truck caught fire, causing significant damage that may take months to repair. No injuries or fatalities have been reported, but it’s unclear if anyone was inside the burning truck. The Governor of Pennsylvania, Josh Shapiro, declared that both northbound and southbound lanes are now “not structurally sound” and cannot carry traffic. Officials are working on providing alternate routes after witnessing the “remarkable devastation” from a flyover.

— A group of four young children who survived a plane crash that killed their mother in the Amazon, have been found alive after more than a month. Colombian President Gustavo Petro said that they had demonstrated a remarkable example of survival and will be remembered in history. The children, who were weak but survived by eating cassava flour and fruit, were found thanks to an extensive search operation involving over 100 Colombian special forces troops and 70 indigenous scouts.

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