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Your Pro Farmer newsletter is now available... It was another active week on the tariffs/trade front, with President Trump saying a fresh trade deal with China was “possible,” signaling a potential willingness to avoid a brewing trade war between Washington and Beijing. Trump also said a 25% tariff on lumber could take effect by early April, alongside similar tariffs on vehicles, semiconductors and pharmaceuticals. Meanwhile, Thailand says it could ramp up purchases of U.S. ag goods to stave off tariffs on its exports to the United States. Aside from the active trade front, much focus remains on global production prospects, including soybeans and corn in South America and the northern hemisphere winter wheat crops. A hot-button topic is the highly pathogenic avian influenza outbreak and its impact on egg prices. The Trump administration is rolling out a new strategy to combat HPAI, focused on improved containment protocols and medication aimed at reducing reliance on widespread culling. The administration’s new approach includes measures to address egg prices. We cover all of these items and much more in this week’s newsletter, which you can access here.
Cattle on Feed Report: Numbers… The monthly USDA Cattle on Feed stated the February 1 U.S. large-lot (10,000-plus head) at 11.716 million head, down 0.7% from the year-ago total. This virtually matched pre-report estimates averaging 99.2% of last year.
The report stated January feedlot placements at 101.7% of last year (1.822 million head), which fell slightly below the forecast figure at 1.830 million head (102.2%) of year-ago. The close match with expectations for this figure, as well as the close COF result, suggest a minimal futures market reaction next Monday morning. January marketings were expected to rise 2.1% from last year, so the USDA figure at just 1.4% over last year, was a bit of a surprise. The underlying implication that slightly larger numbers remain in feedlots might be seen as slightly bearish for Monday’s opening.
U.S. soybean sales to China slowing…USDA weekly Export Sales activity for China showed a continued slowdown in sales of US soybeans but solid results for upland cotton. Sales activity for 2024-25 included net reductions of 518 metric tons of sorghum, net sales of 101,241 metric tons of soybeans, and net sales of 41,428 running bales of upland cotton. Activity for 2025 included net sales of 2,696 metric tons of beef and 2,440 metric tons of pork.
USDA’s 101st Annual Agricultural Outlook Forum will be held Feb. 27-28…near Washington, DC, with the theme of “Meeting Tomorrow’s Challenges, Today.”
The look at corn and soybean acreage under current conditions will be among the key focal points. The agency produced its budget-related figures last fall that were part of the Agricultural Projections publication that was released ahead of the conference. It is not clear how much the figures released next week will change relative to the initial budget-related outlooks.
USDA analysts in the forecasts released next week are not expected to make any assumptions on the impact of potential tariffs on US agricultural commodities. For the WASDE report, the analysts use the policy actions that are in effect at the time and their outlooks presented next week should follow that track.
USDA will update its forecast for U.S. Agricultural Trade which again should not bring in any impacts from potential tariffs since those are not yet in effect. And the retaliatory tariffs announced by China have not targeted U.S. agricultural products. Despite the lack of tariffs currently in place on imports from Canada and Mexico, those potential levies are likely to dominate or at least be one of the key discussion points in “hallway chatter” that takes place throughout the event.
USDA Secretary Brooke Rollins has already made several public appearances and has held several meetings at USDA in the short time she has occupied the office. Her remarks will be the first time some of the attendees that typically number more than 1,000 will hear from the USDA leader.
The other hallway chatter point will be on government workers and how many may have been fired because of being probationary workers.
Egg Prices and Market Power: A Misguided Blame Game…In the ongoing debate over rising egg prices, some policymakers are quick to blame market consolidation and alleged price manipulation. However, as Brian Albrecht, Chief Economist at the International Center for Law & Economics (ICLE), argues in his latest Economic Forces newsletter (link), the real explanation may be far simpler — supply shocks caused by avian flu. The following is an edited version of Albrecht’s comments on the topic.
Over the past three months alone, more than 30 million chickens — roughly 10% of the nation’s egg-laying population — have been culled to prevent disease spread. Since 2022, the total loss exceeds 136 million birds, creating a significant disruption in supply. Given the slow production cycle of egg-laying hens, even small disruptions can lead to drastic price swings.
Economists point out that egg supply is highly inelastic in the short run, meaning production cannot quickly ramp up to meet demand. Likewise, demand for eggs is also inelastic, as they are a dietary staple with few direct substitutes. This combination results in large price increases when supply drops, even without market manipulation.
Despite Federal Trade Commission (FTC) Commissioner Alvaro Bedoya’s concerns about potential price manipulation, economic fundamentals suggest otherwise. High profits at companies like Cal-Maine Foods—the largest U.S. egg producer—are not necessarily evidence of market power. Instead, firms that managed to maintain production during a crisis would naturally benefit from price increases.
Moreover, empty grocery store shelves contradict monopoly behavior, as monopolists typically restrict quantity while keeping products available at elevated prices. Instead, stock shortages and purchase limits signal a supply shock that retailers are struggling to manage.
While market structure in the egg industry is worth examining, jumping to conclusions without clear economic evidence risks misguided policy responses. Antitrust enforcement should be based on careful analysis, not assumptions about market power.
Ultimately, Occam’s Razor favors the simplest explanation — supply disruptions, not monopolistic manipulation, are driving the price surge. Instead of looking for conspiracy theories, policymakers should focus on addressing the real issue: rebuilding egg production capacity.
White House to scrap longstanding permitting rules... The White House’s Council on Environmental Quality (CEQ) announced plans to eliminate nearly 50-year-old permitting rules, citing concerns over its legal authority under the National Environmental Policy Act (NEPA). The office stated no court has confirmed that Congress granted CEQ the power to direct federal agencies on permitting procedures. This move aligns with President Donald Trump’s “Unleashing American Energy” executive order, which instructed CEQ to consider rescinding the rules. The rollback, set to take effect 45 days after publication in the Federal Register, will be issued as an interim final rule, limiting public notice and comment requirements.
Judge rejects union challenge to Trump-era federal layoffs... U.S. District Judge Christopher R. Cooper ruled against labor unions seeking to block the Trump administration’s mass firings of federal employees. The decision allows the government to proceed with planned layoffs, affecting thousands of workers across multiple agencies, including over 6,000 at IRS. Judge Cooper determined the court lacks jurisdiction, directing unions to the Federal Labor Relations Authority (FLRA). More than 500,000 federal workers could be affected, with economic concerns raised. The Trump administration asserts the president has legal authority to reshape the federal workforce. Unions vow continued legal action, arguing the layoffs threaten essential services.
Canadian trucking company plans U.S. move amid tariff concerns... TFI International, a Canadian trucking company, is planning to relocate to the U.S. as more Canadian businesses consider shifting their operations in response to President Trump’s tariff threats, the Wall Street Journal reports. The company, which has been operating in the U.S. since 2011, already conducts about 70% of its business south of the border. CEO Alain Bédard stated that the move would better align the company with its “shareholder base and commercial presence.” The Trump administration’s proposed tariffs on Canadian imports are causing significant concern among Canadian businesses. Many companies are delaying expansion plans, putting hiring on hold or revising sales outlooks downward.
These reactions indicate how the proposed levies could potentially reshape cross-border supply chains. According to a recent survey by KPMG Canada, nearly half of the business leaders surveyed are planning to either shift investments to the U.S. or establish production operations there. This move is aimed at securing tariff-free access to the U.S. market and reducing costs considering the potential trade barriers.
U.S., Ukraine revive minerals deal talks amid strained relations... Ukraine and the U.S. are accelerating negotiations on a critical minerals deal following tensions between President Volodymyr Zelenskyy and President Trump. After rejecting an initial U.S. offer, Zelenskyy met with special envoy Keith Kellogg, expressing renewed optimism. The deal, which would grant U.S. access to Ukraine’s mineral resources in exchange for security guarantees, is central to Trump’s efforts to end the war with Russia. While discussions continue, Kyiv seeks a more balanced agreement amid concerns over sovereignty and economic fairness.
Meanwhile, the U.S. signaled sanctions relief for Russia could be on the table as Trump rushes toward a deal to end the three-year conflict in Ukraine.
Germany’s leadership shift amid U.S./EU tensions... As Trump reshapes U.S./European relations, Germany is set for a pivotal parliamentary election on Sunday, determining its stance on NATO, the EU and support for Ukraine. Chancellor Olaf Scholz faces tough odds after his coalition collapsed, with Friedrich Merz’s center-right CDU leading the race. However, the far-right AfD, backed by Elon Musk, remains a strong contender. Even if Merz wins, Trump’s administration may not find a smooth partnership, given Merz’s recent criticisms of Vice President JD Vance and U.S. reliability.