Trump pushes Asia to import more U.S. ag goods amid tariff tensions... The Trump administration is intensifying efforts to boost U.S. agricultural exports to Asia, pressing countries like Japan, South Korea, India and Thailand to lower tariffs and expand imports of American rice, soybeans, corn, pork and beef.
Japan and South Korea made up 20% of U.S. rice exports in 2024 and were also top buyers of U.S. pork, with Japan importing 2.5 times more than China. Beef exports to Japan, South Korea and Taiwan accounted for 47% of total U.S. beef shipments. Six Asian countries represented 41% of total U.S. wheat exports.
“Asia has already opened up quite a lot where it can,” said Keisuke Sano of Nomura Research Institute, adding that deeper agricultural shifts will require cultural adaptation.
U.S. presents draft trade framework to Japan amid stalled tariff talks... In this week’s Washington negotiations, the U.S. handed Japan a draft framework for a potential trade agreement, according to Nikkei. Despite the exchange, the talks — led by top officials including U.S. Treasury Secretary Scott Bessent and Japan’s Ryosei Akazawa — yielded no breakthrough after over two hours of discussion.
Tokyo proposed increasing U.S. imports of corn, soybeans and rice and reviewing non-tariff barriers affecting American autos. But the U.S. showed no sign of easing tariffs on cars, steel and aluminum—raising Japanese concerns.
Ministerial-level talks resume in mid-May, with speculation a basic agreement could emerge by the June G7 summit.
China ‘evaluating’ U.S. offer to talk tariffs... Beijing is “evaluating” an offer from Washington to hold talks over President Donald Trump’s tariffs, China’s commerce ministry said. The ministry said the U.S. has approached China to seek talks over tariffs and Beijing’s door was open for discussions. However, it warned the U.S.: “Attempting to use talks as a pretext to engage in coercion and extortion would not work.”
National Economic Council Director Kevin Hasset told CNBC, “We’re hopeful for progress,” and noted that he was pleased to see China had pulled back tariffs on many U.S. products, signaling a potential thaw in trade tensions. This sentiment aligns with President Trump’s recent comments indicating a will-ingness to negotiate and possibly reduce the steep tariffs currently imposed on Chinese goods. Hassett suggested that news regarding tariff talks could emerge soon, although he was careful not to confirm specifics. “We are very optimistic about China, and particularly optimistic about our relations with nearly everyone else,” Hassett said.
Trump ends ‘de minimis’ tariff loophole, targeting Chinese e-commerce imports... President Donald Trump’s executive order eliminating the “de minimis” tariff exemption takes effect today, ending duty-free treatment for small-value packages ($800 or less) shipped from China and Hong Kong. This move is expected to hit discount platforms like Temu and Shein, raise costs for U.S. consumers and disrupt independent e-commerce sellers. Packages will be taxed at 120% of value or face a flat fee starting at $100.00, rising to $200.00 by June 1. It applies to shipments from China and Hong Kong first, with other countries likely to follow.
Status and extension of the 45Z tax credit... Section 45Z of the Internal Revenue Code, established by the Inflation Reduction Act (IRA), provides a technology-neutral tax credit for producers of clean transportation fuels-including both sustainable aviation fuel (SAF) and non-SAF transportation fuels-based on the lifecycle greenhouse gas (GHG) emissions of the fuel produced. The credit is available for fuel produced at qualified U.S. facilities and sold to unrelated parties between Jan. 1, 2025, and Dec. 31, 2027. However, significant uncertainty has surrounded its implementation due to delays in Treasury guidance, especially regarding emissions calculations and registration requirements.
Extension of the 45Z tax credit is being considered as part of the broader congressional budget reconciliation process, which allows for expedited passage of budget-related legislation. Supporters are pushing for inclusion of the extension in upcoming reconciliation bills to ensure timely passage and avoid further uncertainty for the clean fuels sector.
Global food prices increase in April... The UN Food and Agriculture Organization global food price index increased 0.9% in April and was 7.6% higher than last year. Increases in cereal grain, dairy and meat prices outweighed decreases in sugar and vegoils. Compared to year-ago, prices rose 4.3% for meat, 22.9% for dairy and 20.7% for vegoils, while values fell 0.8% for cereal grains and 10.9% for sugar.
Cereal grains:
- Wheat prices edged up due to tightening exportable supplies in the Russian Federation, steady export pace from other major exporters, and currency movements, especially a weaker U.S. dollar against the euro.
- Corn prices increased, influenced by seasonally tighter stock levels in the United States and currency fluctuations. Changes in U.S. import tariff policies also contributed to upward price pressure.
- Rice prices rose 0.8% on stronger demand for fragrant varieties and reduced fresh supply in Vietnam.
Meat:
- Beef and sheep meat prices increased, supported by steady import demand and limited global supplies, especially from Australia and Brazil.
- Poultry prices rose moderately, especially in Brazil, where robust demand and holiday-related processing slowdowns tightened exportable supplies.
Dairy:
- Butter prices hit a new all-time high, up 2.9% from March, driven by reduced inventories and strong milkfat demand in Europe, despite seasonally higher milk production.
- Milk powder and cheese prices also rose, reflecting steady domestic demand and shifting export interest from Europe to Oceania.
Sugar and Vegetable Oils:
- Sugar prices fell for a second consecutive month, mainly due to concerns about global economic outlook, increased sugar output in Brazil and a weaker Brazilian real.
- Vegoil prices were led by lower palm oil prices as global export supplies recovered, though soy and rapeseed oil prices continued to rise due to firm demand and tightening supplies.