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Republicans craft new deal to avert looming gov’t shutdown... House Republicans are eyeing a bill to extend government funding for three months while suspending the debt limit until January 2027, Punchbowl News reported, citing multiple sources involved in the talks.
The legislation would also extend the farm bill, provide $110 billion in disaster aid (including $10 billion in farmer aid) and extend a number of health care provisions. Changes to pharmacy benefit managers, originally in the bill, have dropped from the legislation. The legislation would also wipe the PAYGO scorecard to zero.
Republican leaders have kept President-elect Donald Trump apprised of the agreement. The House will reportedly vote on the measure at 6:00 p.m. ET. It was not clear whether it would get enough support from Republicans and Democrats to pass Congress before funding expires at midnight ET on Friday. Trump urged lawmakers to vote for the package.
We’ll have updates and further details in “First Thing Today” Friday morning.
La Niña-like extended weather forecast... A mild La Niña is expected to develop in early 2025 and the extended weather forecast from the National Weather Service reflects conditions that would be typical of such an event. The 90-day outlook calls for increased odds of below-normal temps across the northwestern part of the country from the Northern Plains through the Pacific Northwest. Above-normal temps are likely across the Southwest, Delta, Southeast and East Coast from January through March. The remainder of the country, including much of the Corn Belt, has “equal chances” for above-, below- and normal temps. The 90-day forecast calls for elevated odds of above-normal precip in the northwestern quadrant of the country, along with a bubble encompassing the eastern halves of Minnesota, Iowa and Missouri, the Mid-South and eastern Corn Belt. Below-normal precip is likely across the Southwest, Delta, Southeast and central Atlantic Coast. The remainder of the country, including most of the western Corn Belt, has “equal chances” for precip.
The Seasonal Drought Outlook calls for drought to persist over existing areas of dryness in the northern Corn Belt and Central and Northern Plains, along with far southern areas of the Southern Plains through March. Drought conditions are expected to improve in the eastern Corn Belt.
Click here to view the extended forecast maps and here for the Seasonal Drought Outlook.
Potential impact of broad tariffs on U.S. agriculture... The proposed sweeping tariffs on U.S. imports from foreign countries by the incoming Trump administration could have severe consequences for the American agricultural sector, as highlighted by economists during a Wednesday Joint Economic Committee hearing.
Ed Gresser, director for trade and global markets at the Progressive Policy Institute, warned the impact on U.S. agriculture would be “quite extensive.” He estimated tariffs on major trading partners like Canada, Mexico and China could affect up to 10% of all farm income, creating significant financial challenges for farmers.
The proposed tariffs risk destabilizing existing trade agreements, such as the U.S.-Mexico-Canada Agreement (USMCA), potentially jeopardizing tariff-free trade with two of America’s top agricultural export markets. Furthermore, escalating tariffs on Chinese goods could undermine already declining exports to one of the United States’ largest agricultural trade partners.
Historical precedent suggests U.S. trade policies targeting major partners like China often trigger swift and severe retaliatory measures. For instance, during the 2018-19 trade conflict, China responded to U.S. tariffs with significant retaliatory tariffs on American agricultural products, leading to substantial financial losses for U.S. farmers, particularly in the Midwest.
Under various tariff scenarios, U.S. soybean and corn prices could face significant downward pressure. Studies indicate that soybean prices could fall by nearly $1 per bushel on average, while corn prices could drop by $0.13 per bushel from already low baseline levels.
Depending on the scenario, U.S. soybean farmers could lose an average of $3.6 to $5.9 billion in annual production value, while corn farmers might face losses of $900 million to $1.4 billion annually.
The impact of these tariffs would extend beyond farmers, affecting rural communities where agricultural activities play a crucial economic role. The combined soybean and corn contribution to total economic output could potentially drop by $4.9 billion to $7.9 billion annually under different tariff scenarios.
USDA expands ag export markets with new RAPP grants... USDA announced $300 million in additional funding through the Regional Agricultural Promotion Program (RAPP) to diversify U.S. agricultural exports. This brings total 2024 RAPP funding to $600 million. The grants will target emerging markets in Africa, Latin America and South/Southeast Asia, fostering opportunities for American producers in regions with growing demand. USDA said it aims to reduce dependency on major markets like China and Canada while addressing global food insecurity through complementary programs. Proposals for the latest funding round exceeded $1 billion, highlighting strong interest in expanding market opportunities.
Dec. 1 feedlot inventory expected to be slightly below year-ago... Analysts expect USDA’s Cattle on Feed Report Friday afternoon to show the large feedlot (1,000-plus head) inventory down 0.3% from year-ago at 11.975 million head as of Dec. 1. The report is expected to show a 5.1% decrease in the number of cattle moved into feedlots last month, while marketings are anticipated to be down 1.8% from November 2023. Of note: The U.S. ban on Mexican cattle imports went into effect on Nov. 22, so this month’s report won’t fully reflect those restrictions. Next month’s report, featuring activity during December, will reflect the restrictions.
| Cattle on Feed | Avg. Trade Estimate (% of year-ago) | Range (% of year-ago) | Million head |
| On Feed on Dec. 1 | 99.7 | 99.1 – 100.3 | 11.975 |
| Placements in November | 94.9 | 91.3 – 98.9 | 1.778 |
| Marketings in November | 98.2 | 97.7 – 98.8 | 1.719 |
GAO report highlights USDA’s financial support to farmers for 2019–2023... The Government Accountability Office (GAO) report provides a comprehensive overview of the financial assistance provided by USDA to agricultural producers from fiscal years 2019 through 2023. Here are the key details: USDA distributed a total of $161 billion in financial assistance to agricultural producers over the five-year period. This substantial sum was allocated through various programs, including:
- Supplemental assistance programs (42% of total)
- Crop insurance program (33% of total)
- Other farm bill authorized programs
Distribution of assistance:
- On average, about 1 million agricultural producers received assistance each year.
- More than 90% of producers received an average of $12,000 per year
- Less than 10% of producers received an average of $272,000 per year
- The top 10 producers received an average of $18 million per year
- Individual assistance ranged from a few dollars to $215.2 million for a single producer in 2022.
The number of historically underserved producers participating in USDA financial assistance programs increased significantly, from 84,000 to 183,000 over the five-year period. This included new farmers, veterans, and people subject to racial or ethnic prejudice.
Participation of livestock and poultry producers also saw a substantial increase, from 76,000 to 243,000 producers over the five-year period. Top recipients by state: Texas, North Dakota and Iowa received the most assistance, in that order.
Missouri farmers sue Tyson Foods, Cal-Maine over anticompetitive practices... Missouri farmers allege Tyson Foods and Cal-Maine Foods conspired to block other buyers from purchasing Tyson’s Dexter facility, violating state antitrust laws. Tyson is accused of breaking its commitment to avoid antitrust behavior during the facility’s sale. Farmers who invested heavily in specialized infrastructure for Tyson say they face severe financial losses. The closure of the Dexter plant left farmers without nearby processing options, rendering their farms nearly worthless. Cal-Maine, the largest U.S. egg producer, acquired the Dexter facility in March 2024 to convert it for egg production. The company has proposed contracts to former Tyson farmers, offering terms far less favorable than previous agreements. Tyson seeks federal exoneration, while Missouri officials press for the facility’s resale to another poultry processor. Farmers must either shut down operations or take on debt to convert their farms to meet Cal-Maine’s requirements, with reduced earnings.
Port of Los Angeles sees record container flows in November... In a year of record container volumes, the Port of Los Angeles continued its strong performance in November, handling 884,315 twenty-foot equivalent units (TEUs). This marks a 16% increase year-over-year and 15% above the port’s five-year average for the month. Year-to-date, the port has processed over 9.3 million TEUs, up 19% from 2023. Executive Director Gene Seroka attributed the growth to a robust U.S. economy, strong consumer spending and geopolitical factors such as East Coast labor disputes and frontloading in anticipation of potential trade policy changes. November imports rose 19%, while exports increased 11%.