Likely Outcomes of Lingering Budget, Debt Issues

Grassley to seek re-election | Amy Walter on Biden’s competence | Commerce Sec. on trade w/China

In Today’s Digital Newspaper

Market Focus:
• Treasury yields surged back to levels last seen in middle of summer
• U.S. and European economies slowed in September
• Federal Reserve: Net worth of U.S. households $134 trillion in second quarter
• Costco costs are higher, running out of many general products within two weeks 
• China expands crackdown by declaring all crypto activities ‘illegal’
• U.S. posts energy product trade surplus for first time since 1970s
• USDA declares emergency for grain exporters located on lower Mississippi River
• Sizing up the U.S. wheat market
• Ag demand update
• Light price pressure as weekend approaches
• Argentina’s corn planting starts early
• China the lead buyer of Australian wheat, despite tensions (details below)
• Ukraine’s grain exports off a solid start
• Curbs on emissions have disrupted Chinese industrial operations
• U.S. farm & biofuel leaders to White House: Pull EPA back from the brink
• German urging Poland to help it create a wild boar-free zone to help battle ASF
• Cattle on Feed Report again expected reflect herd contraction
• Markets ready for H&P Report 

Policy Focus:
• Framework agreement announced on human infrastructure measure, but what is that?
• Update on bipartisan infrastructure (BIF/traditional) bill
• Update on combined CR/debt limit suspension bill
• Likely outcomes of key congressional issues 
• What is in the Dems’ hidden $28 billion for conservation in reconciliation measure 

Afghanistan:
• Hearing Sept. 28 with key Biden administration officials   

Biden Administration Personnel:
• Senate Ag panel forwards Wilkes’ nomination to full Senate for USDA post
• Holds remain on other USDA nominations
• Senate clears another USTR nominee 

China Update:
• Chinese regulators tell Evergrande to avoid a near-term default on dollar bonds
• China is lead buyer of Australian wheat, despite tensions
• Commerce secretary: U.S. must trade with China, given size of market
• China plane demand 

Energy & Climate Change:
• Farm, biofuel groups urge White House to intervene on expected lower RFS mandates
• Calif. Gov Newsom rolls out $15-billion climate plan 

Livestock, Food & Beverage Industry Update:
• U.S. pledges $10 billion at food summit, half for domestic programs 

Coronavirus Update:
• CDC panel endorses Pfizer booster shot for elderly, high-risk people
• NGFA raises concerns re: vaccine mandate’s unintended consequences on rural workforce 

Politics & Elections:
• Grassley (R-Iowa), the oldest senator at 88, running for re-election
• The competency question re: President Biden
• Jan. 6 committee issues subpoenas to four former Trump officials
• FEC rejects complaints about election interference
• GOP-led review of Arizona election results didn’t change President Biden’s victory 

Congress:
• Iron Dome funding clears
• House passes Dept. of Defense’s 2022 budget; more funding than Biden requested 

Other Items of Note:
• Cotton AWP falls a second straight week
• Delta Air Lines calls for national “no fly” list of unruly passengers
• New federal flood insurance rules that reflect real risks of climate change
• U.S. special envoy for Haiti resigned in protest over deportations of Haitian migrants
• USDA announces intent to establish an Equity Commission, solicits nominations

MARKET FOCUS

Equities today: Global stock markets were mostly weaker in overnight trading. The U.S. Dow opened up around 100 points lower. Asian equities were mixed as concerns lingered about the Evergrande situation. The Hang Seng index fell 318.82 points, 1.30%, at 24,192.16. Japan’s Nikkei rose 609.41 points, 2.06%, at 30,248.81 after being closed Thursday for a holiday. European equities are mostly lower in early trade action. The Stoxx 600 was off 0.9% with most regional markets seeing losses of 0.2% to 1.0%. Spanish shares, however, were seeing slight gains.

     U.S. equities yesterday: The Dow added 506.50 points, 1.5%, to 34,764.82 in its largest one-day surge since July. The S&P 500 gained 53.34 points, 1.2%, to end at 4,448.98, while the Nasdaq added 155.40, 1%, to 15,052.24 points. All three indexes are now higher on the week.

     Treasury yields surged back to levels last seen in the middle of the summer. The curve, as measured by the gap between the 2-year Treasury and the 10-year, had flattened after Fed chief Jay Powell's press conference, with the gap narrowing about 4 basis points. Yesterday saw steepening, with the gap jumping more than 10 basis points. It now stands around 117 basis points. The 10-year yield saw its biggest one-day move since February, pushing above 1.4% for the first time since early July. It's seen a ceiling of about 1.8% this year.

On tap today (see detailed list of events and reports below):

     • U.S. new-home sales are expected to rise to an annual pace of 720,000 in August from 708,000 a month earlier. (8:30 a.m. ET)
     • Baker Hughes rig count is out at 1 p.m. ET.
     • Federal Reserve: Cleveland’s Loretta Mester on the economic outlook at 8:45 a.m. ET, Chairman Jerome Powell, Vice Chairman Richard Clarida and governor Michelle Bowman at a Fed Listens event on the pandemic recovery at 10 a.m. ET, Kansas City’s Esther George on the economy and monetary policy at 10 a.m. ET, and Atlanta's Raphael Bostic on community development at 12 p.m. ET.
     • Kansas City Southern hosts a special shareholder meeting to vote on its proposed merger with Canadian Pacific Railway.

U.S. and European economies slowed in September as supply-chain bottlenecks and worries over the Delta variant weighed on businesses, adding to signs the global economy is experiencing a soft patch. Forecasting firm IHS Markit said its index measuring U.S. business activity fell to the lowest level in a year and its eurozone index dropped to a five-month low. Purchasing managers at both manufacturing and services businesses reported slower growth. The Delta variant of Covid-19 weighed on service-sector activity, with the latest reports showing a slower rise in new business and continued price pressures tied to higher costs for supplies and labor. There were bright spots. A measure of optimism at U.S. services businesses reached a three-month high as purchasing managers anticipated a pickup in demand and an easing of the pandemic.

Federal Reserve reported the net worth of U.S. households was $134 trillion in the second quarter — up from $128.4 trillion in the first quarter and $110 trillion in the fourth quarter of 2019, before the pandemic took hold. Much of that increase in wealth came about from gains in stock prices and the value of people’s homes. However, notable is how much more money people have lying around in cash: $16.5 trillion in the second quarter, a reflection of both how much people reduced spending, particularly in the early stages of the pandemic, and the substantial relief that the federal government has provided.

Costco costs are higher, running out of many general products within two weeks. Costco Wholesale said higher labor costs, freight costs and transportation costs, combined with a dearth of truckers and drivers, port delays, and container and component shortages were pushing the price of items higher. Chief Financial Officer Richard Galanti estimated overall price inflation on Costco products in the 3.5% to 4.5% range. Galanti said Costco is selling out of many of its general items within two weeks.

Market perspectives:

     • Outside markets: The U.S. dollar index was weaker ahead of U.S. trading even as the euro and British pound were both weaker versus the U.S. currency. The yield on the 10-year U.S. Treasury note is weaker, trading around 1.42%, while global government bond yields are higher. Gold and silver futures are little changed, with gold around $1,750 per troy ounce and silver around $22.50 per troy ounce.
 

     • China expands crackdown by declaring all crypto activities ‘illegal’. The People’s Bank of China, the country’s central bank, specifically targeted overseas cryptocurrency exchanges today, declaring that it was illegal for them to provide online services to residents in China. Bitcoin (BTC-USD) is down 1.7% and Ethereum (ETH-USD) is falling 6%.

     • Crude oil prices remain weaker ahead of U.S. market action, with U.S. crude around $73.10 per barrel and Brent around $76.30 per barrel. Futures were lower in Asian action, with U.S. crude down 27 cents at $73.03 per barrel and Brent down 24 cents at $76.22 per barrel.
 

     • U.S. posts energy product trade surplus for first time since 1970s. In 2020, the U.S. saw a trade surplus in energy products for the first time since at least 1974, the Energy Information Administration (EIA) detailed in a Sept. 22 post. Overall, the 2020 U.S. energy trade surplus stood at $27 billion, EIA said citing Census Bureau trade data. That compared with a record $938 billion trade deficit for non-energy goods. During the first six months of 2020, the U.S. has accumulated a $9 billion trade surplus in energy goods while seeing a trade deficit of $505 billion in non-energy products.

     Overall, EIA noted that petroleum accounts for 92% of U.S. energy import values and 74% of energy export values. “The net US petroleum trade value deficit peaked in 2008, but it has fallen over the past decade as volumes of US petroleum exports increased to record-high levels and imports decreased,” the agency detailed. “The 2020 net US petroleum trade value deficit was $3 billion, the smallest on record, partially because of less consumption amid COVID-19 mitigation efforts,” it added.

     Meanwhile, natural gas accounts for a rising share of U.S. energy trade, comprising 5% of energy import values and 22% of energy export values in 2020 — yielding a $26 billion surplus for the year. “Volumes of U.S. natural gas exports reached a record high in 2020, and they have continued to increase in 2021,” EIA said. “Through the first six months of 2021, the United States exported record volumes of pipeline gas to Mexico and liquefied natural gas (LNG).”

     • Ag demand: Pakistan bought around 575,000 MT of wheat in an international tender for 500,000 MT of the grain. Jordan issued a new international tender to buy 120,000 MT of milling wheat from optional origins. South Korea’s Korea Feed Association bought around 60,000 MT of feed corn in a private deal after earlier making no purchase in an international tender to 138,000 MT. Japan purchased 55,481 MT of food-quality wheat from the U.S. as well as 57,586 MT from Canada.

     • USDA declared an emergency for grain exporters located on the lower Mississippi River from Baton Rouge, La. to the mouth of the river. USDA also has issued a waiver of official inspection and weighing on a shipment-by-shipment basis until Sept. 30, 2021. Link for details.

     • Sizing up the U.S. wheat market. Grain trader and analyst Richard Crow says: “The wheat market had rumors of China buying Europe and U.S. wheat. The Small Grains report and stock numbers on Sept. 30 could be large for the wheat market. The spring wheat market is where the attention will be focused. The HRW stock number may reflect large wheat feeding?   The sw is dry for seeding; rains are forecasted for next week.”

     • NWS weather: Isolated instances of flash flooding possible across parts of New England, southern Florida, and the Southwest through this weekend... ...After a brief taste of autumn, well above average temperatures return to the Northern Plains by Saturday.

Items in Pro Farmer's First Thing Today include:

     • Light price pressure as weekend approaches
     • Argentina’s corn planting starts early
     • China the lead buyer of Australian wheat, despite tensions (details below)
     • Ukraine’s grain exports off a solid start
     • Curbs on emissions have disrupted Chinese industrial operations
     • U.S. farm & biofuel leaders to White House: Pull EPA back from the brink
     • German urging Poland to help it create a wild boar-free zone to help battle ASF
     • Cattle on Feed Report again expected reflect herd contraction
     • Markets ready for H&P Report

POLICY FOCUS

— Framework agreement announced on human infrastructure measure, but what is that?

• Senate Majority Leader Chuck Schumer (D-N.Y.) on Thursday morning announced the Senate, House and White House reached a deal on a “framework” to pay for the huge human infrastructure spending package they hope to pass this fall under budget reconciliation. “So, the revenue side of this, we have an agreement on,” Schumer announced at a joint press conference with Speaker Nancy Pelosi (D-Calif.) and Treasury Secretary Janet Yellen.
• Schumer said: “We reached an agreement on a framework, menu of options that will pay for any final negotiated agreement."
• Pelosi called it “an agreement on how we can consider, go forward in a way to pay for this… “It’s not about a price tag, it’s about values.”
• Of note, the deal does not include a top-line revenue number or a top-line spending number.
• House Democrats are planning to begin marking up the package Saturday afternoon, according to Budget Chair John Yarmuth (D-Ky.). Negotiations on that package have a long way to go, and there’s virtually no chance it will be ready for action by the time of Monday’s traditional infrastructure vote. Under reconciliation procedures, the Budget Committee takes the pieces of the package from the House committees — the work of 12 panels — and puts everything together into one bill. The Budget Committee does not alter or revise the work of those committees; it gives an up-or-down vote on the legislative product assembled. Budget then sends the measure onto the Rules Committee. That is where there will be a manager’s amendment offered that will significantly revise what has been approved by the House committees. House Democratic leaders want the substitute bill to be something that can pass the Senate unchanged. That means it will take time between the Budget Committee markup and whenever a deal is reached with Senate Democrats.
• Pelosi has promised moderates that “we would not have House Members vote for a bill with a higher topline than would be passed by the Senate.” That means they'll have to pare back any reconciliation package before putting it on the floor.
• Sen. Joe Manchin (D-W.Va.) doesn’t support expanding Medicare benefits without first addressing the program’s long-term solvency, putting him at odds with Sen. Bernie Sanders (I-Vt.) and other liberals. Asked about Democrats’ plans to expand benefits for dental, vision and hearing in the upcoming budget reconciliation bill, Manchin pointed to the program’s long-term financial problems instead. Asked if he still supports a work requirement for the child tax credit, Manchin said he wants “work requirements for everything. Means testing and work requirements.”
• Real cost of the now $3.5 trillion measure is really $5 trillion to $5.5 trillion, according to the Committee for a Responsible Federal Budget. Total U.S. annual GDP is about $23 trillion. How does the so-called bipartisan Congressional Budget Office (CBO) not see this? Because the CBO scored the bill based on the directions Democrats gave. Observers recall how CBO scored the federal takeover of student loans as a money raiser in 2010. That certainly did not occur. Link to a WSJ commentary which says: “The bills moving through committees are full of delayed starts, phony phase-outs, and cost shifting to states designed to fit $3.5 trillion into a 10-year budget window that can pass with a mere 51 Senate votes. Even if the bill shrinks to $2 trillion or less, the real costs will be far greater. Behold one of the greatest fiscal cons in history.”

— Update on bipartisan infrastructure (BIF/traditional) bill:

• Progressives insist they’ll vote against the BIF if Speaker Pelosi goes ahead with a vote she promised to deliver to centrists in her caucus by Sept. 27. Rep. Pramila Jayapal (D-Wash.), head of the Congressional Progressive Caucus (CPC), insists half of her 96-member-strong caucus will vote against the infrastructure bill if the House goes ahead with the vote and does not first move forward with a larger $3.5 trillion spending package. That is more than Republican support for the bipartisan bill, especially after the House minority whip, Rep. Steve Scalise of Louisiana, announced that he would urge Republicans to vote against it.
• Will Pelosi postpone the Sept. 27 vote, infuriating the members to whom she promised it, or will she let it go forward and fail? The outcome will shape negotiations over the partisan human infrastructure measure. Rep. Josh Gottheimer (D-N.Y.), a leader of the bipartisan Problem Solvers Caucus, said there’s “zero indication” Monday’s vote will be postponed due to liberal opposition. But veteran congressional observers don’t believe Pelosi will hold a vote she is going to lose to prove a point to moderates. The vote can be postponed several days under House rules.
• About six weeks ago the Senate passed the BIF, with 19 Republicans joining all 50 Democrats in support. Some of those Republicans are lobbing House Republicans to vote for the measure, despite House GOP leadership working against the measure. 

— Update on combined CR/debt limit suspension bill:

• The Senate will have a cloture vote on Monday (at 5:30 p.m. ET) on a House-passed bill to keep federal agencies open until Dec. 3. The cloture vote is almost certain to fail. The House bill, passed Wednesday night on a party-line vote, includes language suspending the debt limit until Dec. 2022. Senate Minority Leader Mitch McConnell (R-Ky.) and most of his GOP colleagues are opposed to such a move. Republicans are demanding that Democrats handle the debt-limit issue on their own via reconciliation.
• Democrats will have to decide on the next steps for government funding and the debt limit. This includes moving a debt-limit increase on their own, possibly as part of a separate scaled-back reconciliation package. A likely CR/stopgap spending measure without the debt limit suspension is the likely option to keep the government open.
• GOP alternative bill. Sen. Richard Shelby (R-Ala.), ranking member of the Senate Appropriations Committee, and McConnell have offered their own version of a short-term funding bill that is largely like the House-passed bill, except it doesn’t have the debt-limit language.
• In a report today, the Bipartisan Policy Center said that the U.S. government could run out of cash and start missing payments on things like Social Security checks as soon as Oct. 15, but no later than Nov. 4. 

— So, what’s the likely outcomes of key congressional issues?

• A stopgap spending bill without a debt limit suspension, but one including billions in aid for 2020 and 2021 ag disasters.
• Dems will include a debt limit suspension in a reworked and much-scaled back human infrastructure bill via reconciliation. Or, Dems could just do a separate reconciliation bill just to raise the debt ceiling. That would be faster than adding to a bigger recon bill.
• A House delay from a promised Monday vote on traditional infrastructure unless Pelosi works another deal with her moderates and progressives (liberals). 

— Wonder what is in the Dems’ hidden $28 billion for conservation that is part of the $3.5 trillion reconciliation package? Here is a summary reported by Politico and other news outlets:

• $5 billion for direct payments to producers who establish cover crops totaling $25 per-acre, up to 1,000 acres per producer through fiscal year 2026.
• $9 billion for the Environmental Quality Incentives Program through fiscal year 2026.
• $4 billion for the Conservation Stewardship Program through fiscal year 2026.
• $1.5 billion for the Agricultural Conservation Easements Program through fiscal year 2026.
• $7.5 billion for the Regional Conservation Partnerships Program through fiscal year 2026.
• $200 million for Natural Resources Conservation Service technical assistance through fiscal year 2031.
• $650 million for climate change adaptation through regional climate hubs and carbon sequestration and greenhouse gas emissions quantification through NRCS.

     Comments: While the Conservation Reserve Program (CRP) has been often mentioned by the current administration as one of the tools that it is aiming to use relative to climate-smart agriculture, the apparent summary does not indicate there are any additional funds set aside for the program. Also, the way Democrats have kept this information from Republicans Ag panel members could have negative overtones for the next farm bill debate. This continues a pattern of declining or disappearing bipartisanship on the House Ag Committee that started with the rancorous debate over nutrition programs that unfolded during the 2018 Farm Bill process. Meanwhile, tempers flared Thursday when House Agriculture Chairman David Scott (D-Ga.) limited discussion during a committee hearing. “We’re here to deal with climate change and nothing else,” he said, telling Rep Austin Scott (R-Ga.), “I’m tired of your disrespect.” Austin Scott followed the chairman’s instructions when it was his turn to question witnesses. At the end of his allotted five minutes, he asked, ‘Mr. Chairman, is that acceptable?” David Scott grinned but did not respond at least audibly.

AFGHANISTAN

— Hearing Sept. 28. Defense Secretary Lloyd Austin, Chairman of the Joint Chiefs of Staff Mark Milley, and U.S. Central Command chief Kenneth McKenzie testify in the Senate Tuesday, Sept. 28, about the chaotic U.S. withdrawal from Afghanistan. They will reprise that testimony the following day in the House.

BIDEN ADMINISTRATION PERSONNEL

— Senate Agriculture Committee forwards Wilkes’ nomination to full Senate for USDA post; holds remain on other nominations. The Senate Agriculture Committee approved the nomination of Dr. Homer Wilkes to be undersecretary for natural resources and the environment on a voice vote, sending the nomination to the full Senate. Senate action on Wilkes’ nomination is not clear, but two other USDA nominations are still pending before the chamber as holds have been put on the nominations of Robert Bonnie to be undersecretary for farm production and conservation and on Xochitl Torres Small to be undersecretary for rural development.

— Senate clears another USTR nominee. The Senate voted Thursday to approve Sarah Bianchi as deputy US trade representative to handle trade areas like China. The vote was 85-11.

CHINA UPDATE

— Chinese regulators tell Evergrande to avoid a near-term default on dollar bonds, and to focus on completing unfinished projects and repaying individual investors. The developer had an $83.5 million coupon due Thursday (with a face value of $2.03 billion) and a 30-day grace period to make the payment. A missed payment would set the stage for what could be the largest-ever dollar bond default by a company in Asia. Chinese authorities are asking local governments to prepare for the potential downfall of Evergrande, according to officials familiar with the discussions, signaling a reluctance to bail out the debt-saddled property developer while bracing for any economic and social fallout from the company’s travails.

     Shares of Evergrande dropped more than 10% today, but they are still up on recent lows. The company’s billionaire founder, Xu Jiayin, is affiliated with the Chinese Communist Party, most likely giving creditors more confidence to keep lending money.

     Of note, Evergrande’s auditor gave it a clean bill of health this spring — after a year in which its stock and bond prices seesawed, it offered deep discounts to keep sales growing and the government effectively said it had borrowed too much.

— China the lead buyer of Australian wheat, despite tensions. Political tensions between China and Australia have upended Australian exports of some products like wine, barley, coal and beef to China, but Beijing has remained a strong buyer of Australian wheat, speaking to its need for the grain. China has been Australia’s top buyer of wheat in 2021-22, accounting for 2 MMT of the country’s 5 MMT in sales, according to trade sources and an analyst cited by Reuters. One of them detailed that China cancelled some cargoes of French wheat due to quality issues and scooped up some Australian wheat instead.

— Commerce secretary: U.S. must trade with China, given the size of the market. Commerce Secretary Gina Raimondo said she will seek to improve business ties between the two countries, telling the WSJ in an interview (link) that business is of mutual benefit at a time of increasing tensions over national-security and human-rights issues. And though China disadvantages U.S. companies by subsidizing exports and winking at the theft of intellectual property, she said, the U.S. need to trade with China is “just an economic fact.”

— China plane demand. Boeing slightly raised the 20-year forecast for China's airline market, forecasting the country will need 8,700 new aircraft valued at $1.47 trillion by 2040 to meet rising air travel demand. In its annual commercial market outlook, Boeing notes the Chinese market's resilience during Covi-19 and estimates the market opportunity for commercial aviation services in the region at nearly $1.8 trillion. China's economic fundamentals and a middle-income demographic that is expected to double in two decades underpin the anticipated increase in air travel, Boeing says.

ENERGY & CLIMATE CHANGE

— Farm, biofuel groups urge White House to intervene on expected lower RFS mandates. With EPA expected to soon issue its proposed levels for biofuels under the Renewable Fuel Standard (RFS), perhaps as soon as today, a coalition of farm and biofuel groups called on the White House to intervene and pull EPA “back from the brink” of reducing biofuel mandates. The groups said the expected standards would “destroy a decade of progress on low-carbon biofuels and brazenly violate the promises that President Biden made to farmers, green voters, and his own allies in Congress.” The groups, including the American Farm Bureau Federation, Advanced Biofuels Business Council, American Soybean Association, National Corn Growers Association, National Biodiesel Board, Renewable Fuels Association, Growth Energy, and the National Farmers Union, said reported potential reductions in biofuel mandates would favor the oil industry and provide “handouts that eclipse those obtained by fossil fuel advocates under the previous administration.” The groups concluded by calling on President Joe Bident to “ensure the EPA avoids a mistake that would undermine the Biden-Harris administration’s relationship with farmers, biofuel producers, and climate advocates across rural America.”

— Calif. Gov Newsom rolls out $15-billion climate plan. Calif. Gov. Gavin Newsom on Thursday signed a $15-billion climate package for California, the largest such investment in state history. “We feel a deep sense of responsibility here in the state of California because of the smash-mouth realities of climate change,” Newsom said. “Not just the issues of the acuity and frequency and duration of these wildfires, but also what’s happening with this mega-drought over the entire West Coast of the United States.” The announcement arrived in tandem with Climate Week and the run-up to the United Nations Climate Change conference in Glasgow, Scotland, this fall. Big-ticket items in the package include $5.2 billion for drought response and water resilience; $3.7 billion for issues like extreme heat and sea level rise; $3.9 billion for electric vehicle investment and infrastructure; $1.5 billion for wildfire response and forest resilience, and $1.1 billion for sustainable agriculture.

LIVESTOCK, FOOD & BEVERAGE INDUSTRY

— U.S. pledges $10 billion at food summit, half for domestic programs. The U.S. joined other countries at a U.N.-sponsored food summit in pledging on Thursday to reduce world hunger. The Biden administration said it would put $10 billion into the effort, half of it to be spent domestically and half abroad.

CORONAVIRUS UPDATE

— Summary: Global cases of Covid-19 are at 230,663,767 with 4,730,159 deaths, according to data compiled by the Center for Systems Science and Engineering at Johns Hopkins University. The U.S. case count is at 42,672,441 with 684,357 deaths. The Johns Hopkins University Coronavirus Resource Center said that there have been 387,821,704 doses administered, 182,587,334 have been fully vaccinated, or 55.6% of the total U.S. population.

— CDC panel endorses Pfizer booster shot for elderly, high-risk people. The Centers for Disease Control and Prevention’s (CDC) vaccine advisory committee has endorsed the use of Pfizer and BioNTech’s Covid-19 booster shot for elderly people and those who may be at risk of developing severe disease. Dr. Rochelle Walensky overruled her agency’s advice by recommending an additional Pfizer vaccine dose for health care workers, teachers and others whose jobs put them at increased risk. The agency had recommended boosters only for people over 65 and those with underlying medical conditions.

— NGFA raises concerns about vaccine mandate’s unintended consequences on rural workforce. NGFA sent a letter (link) on Sept. 20 reflecting the interests of its members in response to President Joe Biden’s directive that private sector companies with 100 employees or more mandate Covid-19 vaccines or weekly testing. “In the midst of an already severe labor shortage, a mandate accompanied by heavy fines threatens the security of the U.S. animal and human food supply chain,” NGFA stated. In a letter addressed to Labor Secretary Marty Walsh and USDA Secretary Tom Vilsack, NGFA President and CEO Mike Seyfert noted that NGFA supports the use of vaccines to fight the spread of Covid-19 and NGFA member companies have held educational sessions and, in some cases, have mandated vaccinations for their employees.

POLITICS & ELECTIONS

— Sen. Chuck Grassley (R-Iowa), the oldest senator at 88, is running for re-election. Link to the announcement, which has a gif of Grassley running before dawn. The decision boosts Republican prospects for holding the seat next year when control of the chamber will be at stake. Recent polling has shown Grassley with a sizable lead over Democratic challenger Abby Finkenauer. in the most recent Des Moines Register poll, the former lawmaker trailed Grassley by nearly double digits. “It looked like he had some vulnerability, but a majority of likely voters still view him as a winner,” pollster J. Ann Selzer, president of Selzer & Co., told the Register in September. “Fifty-five percent is not huge, but it’s solid at this point.”

— The competency question. Amy Walter of the Cook Political Report with Amy Walter, writes: “The longer Biden fails to deliver on his promise of bringing back competency and normalcy, the greater the risk that he becomes more than just a less-than-ideal alternative, but a completely unpalatable one.”

— Jan. 6 committee issues subpoenas to four former Trump officials. The House Select Committee investigating the Jan. 6 assault on the U.S. Capitol issued subpoenas to four Trump administration officials, including former White House chief of staff Mark Meadows, seeking to compel them to turn over records and sit for depositions in connection with the events surrounding the attack. The subpoenas were also sent to Steve Bannon, a longtime adviser to former President Donald Trump; Dan Scavino, former White House deputy chief of staff; and Kashyap Patel, who was chief of staff to the acting Defense secretary at the end of the Trump administration. Patel once served on Trump’s National Security Council.

— FEC rejected complaints about election interference made by Rep. Matt Gaetz (R-Fla.) and former President Donald Trump against Twitter and Snapchat.

— A Republican-led review of the Arizona election results didn’t change President Biden’s victory, according to the county where the audit was conducted.

CONGRESS  

— Iron Dome funding clears House. The House Thursday overwhelmingly passed a bill to replenish Israel’s Iron Dome missile defense system, just two days after it was pulled from a gov’t funding package over objections from progressive lawmakers. The bill passed by a vote of 420-9, with eight Democrats and one Republican (Rep. Massey of Ky.)  voting against it, plus two Democrats voting present.

— House passed the Department of Defense’s 2022 budget, giving them a much larger sum for the next fiscal year than the Biden administration sought. Lawmakers on Thursday voted 316 to 113 in favor of passing the 2022 National Defense Authorization Act . The final bill increases the budget by nearly $25 billion, while House Armed Services Committee Chairman Rep. Adam Smith was one of the Democrats who was against the increase. The Biden Administration had requested $753 billion for the Defense Department, though lawmakers allocated roughly $768 billion, which is in line with the spending approved by the Senate Armed Services Committee.

OTHER ITEMS OF NOTE     

— Cotton AWP falls a second straight week. The Adjusted World Price (AWP) for cotton declined to 77.59 cents per pound, effective today (Sept. 24), the second consecutive weekly decline after it moved over 80 cents per pound the week of Sept. 10. Meanwhile, USDA announced Special Import Quota #23 will be established Sept. 30 for 53,532 bales of Upland cotton, applying to supplies purchased not later than Dec. 28 and entered into the U.S. not later than March 28.

— Delta Air Lines calls for a national “no fly” list of unruly passengers. The company said in a memo to other airlines that it had banned 1,600 people, and it called for carriers to combine their internal lists. A congressional panel yesterday heard that the FAA had logged 4,284 “unruly passenger reports” since January, with about three-quarters related to mask wearing.

— New federal flood insurance rules that reflect the real risks of climate change will make the premiums for waterfront homes soar. Link for details via the NYT.

— U.S. special envoy for Haiti resigned in protest over the Biden administration’s large-scale deportations of the thousands of Haitian migrants arriving at the southern border. Ambassador Daniel Foote said U.S. policy toward Haiti is flawed and that administration officials distorted or ignored his recommendations. A State Department spokesman disputed his characterization of events.

— USDA announces intent to establish an Equity Commission, solicits nominations for membership. USDA this morning announced it will establish an Equity Commission and is requesting nominations for membership on the Equity Commission Advisory Committee and Equity Commission Subcommittee on Agriculture.

EVENTS AND REPORTS

Friday, September 24

· Federal Reserve Listens. Fed Chairman Jerome Powell delivers opening remarks at the Federal Reserve Board virtual "Fed Listens" discussion with representatives of organizations that include nonprofits, small businesses, unions, the hospitality and entertainment industries, and the education sector "to share perspectives on the economic recovery from the Covi-19 pandemic." Fed Governors Michelle Bowman and Vice Chair Richard Clarida will moderate a discussion.
· Federal Reserve. Cleveland Fed President Loretta Mester to deliver remarks.
· Economic outlook and monetary policy. American Enterprise Institute for Public Policy Research (AEI) discussion on the economic outlook and monetary policy.
· Covid and work. Washington Post Live virtual discussion on "The Great Resignation," examining how many employees across the country are reevaluating what work means to them in response to the Covi-19 pandemic and pursuing "more meaningful careers, greater work-life balance and better compensation."

· Economic report. New Home Sales  

· Energy report. Baker-Hughes Rig Count

· USDA reports. ERS: Food Price Outlook NASS: Cattle on Feed | Poultry Slaughter | Turkeys Raised | Hogs and Pigs | Peanut Prices