Good morning!
Grains supported by U.S., China framework trade deal... Corn and soybeans built on Tuesday’s gains during overnight trade while wheat modestly rebounded after a framework trade deal between the U.S. and China. As of 6:30 a.m. CT, corn futures are trading 3 to 4 cents higher, soybeans are mostly 2 cents higher and wheat futures are 3 to 6 cents higher. The U.S. dollar index is trading near unchanged while front-month crude oil futures are nearly $1.00 higher.
U.S., China reach deal to ease export curbs, keep tariff truce intact... U.S. and Chinese officials said after two days of meetings in London they had agreed on a framework deal to keep the trade truce intact and remove China’s export restrictions on rare earths. Commerce Secretary Howard Lutnick said the framework deal puts “meat on the bones” of an agreement reached last month in Geneva to ease bilateral retaliatory tariffs. Lutnick said the agreement would remove restrictions on Chinese exports of rare earth minerals and magnets and some of the recent U.S. export restrictions “in a balanced way,” but he did not provide specific details. As trade officials prepare to brief their respective leaders, both sides appear eager to avoid a collapse in negotiations — but the road to ratifying the deal remains politically charged.
U.S, Mexico negotiating steel tariffs... The U.S. and Mexico are reportedly nearing a deal to reduce or eliminate President Donald Trump’s 50% steel tariffs on imports up to a certain volume. An industry source familiar with the talks told Reuters that a likely outcome would include a quota arrangement, under which a specified volume from Mexico could enter duty free or at a reduced rate and any imports above that level would be charged the full 50% tariff. The specific volume level of the quota was not yet determined.
EU braces for prolonged trade talks with U.S. beyond July 9 deadline... Trade negotiations between the EU and U.S. are expected to stretch beyond President Donald Trump’s self-imposed July 9 deadline, despite a recent acceleration in talks. Citing people familiar with the matter, Bloomberg reports that EU officials see reaching a deal on broad principles by that date as the best-case scenario — but emphasize that more time will be needed to resolve technical details. The negotiations come ahead of a looming 50% U.S. tariff set to hit nearly all EU exports starting July 9. The EU estimates that the Trump administration’s tariff policy already covers about €380 billion ($434 billion), or 70% of the bloc’s U.S.-bound exports. According to Bloomberg, the EU is “stepping up preparations for countermeasures, including actions that could go beyond tariffs.” The EU has offered to gradually move toward zero-for-zero tariffs on cars and industrial goods, with interim quotas under consideration. However, Brussels has drawn firm red lines against U.S. demands that would infringe on the EU’s regulatory or tax sovereignty. Bloomberg also notes that “EU officials believe there is an opportunity to cooperate on critical minerals,” with the issue potentially surfacing at this month’s G7 summit in Canada.
Appeals court keeps Trump-era tariffs in place — for now... The U.S. Court of Appeals for the Federal Circuit has ruled that tariffs imposed under the Trump administration using the International Emergency Economic Powers Act (IEEPA) will remain in effect while legal proceedings continue. This decision extends a previous stay of a ruling by the Court of International Trade (CIT), which found the tariffs lacked proper legal justification under IEEPA. In its order, the appeals court noted it will hear oral arguments in the case on July 31, setting an expedited schedule that both sides had requested. However, the three-judge panel offered no indication of how it might rule, only stating, “Both sides have made substantial arguments on the merits.” If the losing party chooses to appeal after the Federal Circuit’s decision, the case is widely expected to reach the U.S. Supreme Court. The case could have major implications for presidential tariff authority under IEEPA.
World Bank cuts global growth forecast amid trade uncertainty... The World Bank on Tuesday slashed its economic global growth forecast for 2025 by 0.4 percentage point to 2.3%, saying higher tariffs and heightened uncertainty posed a “significant headwind” for nearly all economies. At that level, global growth would be the lowest since the Great Recession in 2008. The U.S. forecast was slashed 0.9 point to 1.4% and the 2026 outlook was lowered 0.4 point to 1.6%. World Bank left its forecast for China unchanged at 4.5%, saying Beijing still had monetary and fiscal space to support its economy and stimulate growth. The report forecast global trade growth would slow to 1.8% this year from 3.4% in 2024 – based on tariffs in effect as of late May. World Bank said global inflation was expected to reach 2.9% in 2025 given tariff increases and tight labor markets.
India’s rice stocks record high, wheat inventories at four-year high... India’s rice stocks in government warehouses rose 18% from a year ago to a record 59.5 MMT as of June 1, more than four times larger than the government’s target of 13.5 MMT for July 1. Wheat inventories stood at 36.9 MMT on June 1, well above the target of 27.6 MMT. Record rice stocks will boost exports, while ample wheat inventories will help the government tame any price spikes later this year by increasing open market sales.
EPA to repeal Biden-era power plant emissions rule... EPA Administrator Lee Zeldin is set to unveil the Trump administration’s formal repeal of a key Biden-era power plant emissions rule at an event today, confirming conservative energy policy advocates’ hopes for a regulatory rollback. Zeldin will be joined by several House Republicans from the eastern U.S., underscoring the political messaging tied to regional energy concerns and coal industry support. The announcement will mark a significant reversal of the Biden administration’s efforts to curb greenhouse gas emissions from fossil fuel-fired power plants. The rule in question aimed to limit carbon dioxide emissions under the Clean Air Act and had been framed by the Biden EPA as essential for achieving the U.S. climate goals for 2030 and beyond. The Trump administration is expected to propose a narrower replacement rule in the coming months that emphasizes plant-level efficiency upgrades and voluntary state compliance pathways.
OMB restores small refiners’ session on EPA biofuel mandate... A meeting between the Small Refineries Coalition, Wynnewood Refining Company and the Office of Management and Budget (OMB) regarding the Environmental Protection Agency’s (EPA) Renewable Fuel Standard (RFS) Program: Set 2 proposed rule is back on the schedule after briefly being removed. Initially set for June 12, the session is now rescheduled for June 16. No explanation was given for the date change. With this update, the total number of stakeholder sessions at OMB on the EPA’s RFS rule now stands at 24 — either completed or scheduled. The final meeting remains slated for June 23.
ICE raids Omaha meat production plant... The U.S. Immigration and Customs Enforcement (ICE) raided a Glenn Valley Foods meat production plant in Omaha, Nebraska, on Tuesday, detaining dozens of workers. The raid was “based on an ongoing criminal investigation into the large-scale employment of aliens without authorization to work in the United States,” an ICE spokesperson told an ABC News affiliate.
Mexico shifts to targeted ban on Brazilian chicken due to HPAI... Mexico eased a ban on chicken shipments from Brazil, setting the restriction now only to products coming from the Brazilian state of Rio Grande do Sul, instead of a previous countrywide ban, Brazil’s ag ministry said. Brazil in mid-May identified a case of highly pathogenic avian influenza (HPAI) on a commercial farm in Rio Grande do Sul.
Wholesale beef prices still climbing... After showing potential signs of pausing last week, wholesale beef prices have regained upward momentum. Boxed beef prices jumped $4.51 to $371.76 for Choice and 91 cents for Select to $359.84 on Tuesday. Despite the strength, the wholesale market is not keeping pace with the historic surge in cash cattle prices, keeping packer margins deep in the red.
Pork packer margins still black... Pork plant margins have tightened amid the seasonally rising cash market but remain slightly in the black due to strengthening wholesale pork prices. The CME lean hog index is up another 92 cents to $99.97 as of June 9. Pork cutout firmed 59 cents to $110.88 on Tuesday.
Overnight demand news... Taiwan purchased 65,000 MT of corn expected to be sourced from Brazil and tendered to buy 95,450 MT of U.S. milling wheat. Iran passed on a tender to buy 120,000 MT each of corn, feed barley and soymeal.
Today’s reports
- 9:30 a.m. Weekly Ethanol Production — EIA
- 1:00 p.m. Meat Price Spreads — ERS
- 2:00 p.m. Broiler Hatchery — NASS