China Unveils New Plan for Food Security

King Ten

Remarks of Officials

Economic

Commodity

Political

China–U.S. Trade War

Summary:

China's new agricultural policy focuses on diversification, self-sufficiency, and tech innovation amidst global tensions.

China has released its annual "No 1 document," a key policy blueprint outlining the government's top priorities for rural and agricultural development. The plan focuses on stabilizing grain and oilseed production, diversifying agricultural imports, and providing greater support to farmers.

This strategy comes as Beijing contends with a complex mix of trade friction with major food exporters like the US and Canada, a domestic economic slowdown, and mounting climate challenges. While China achieved record grain output last year, its heavy reliance on imports has prompted an accelerated push toward self-sufficiency through investments in machinery and seed technology.

Diversification as a Core Resilience Strategy

A central theme of the new policy is the push to diversify supply chains. The document mentions "diversification" three times, a notable increase from just once in 2025, signaling a strategic pivot. The goals are to expand oilseed supplies, develop a more varied food system, and broaden the sources of agricultural imports.

According to Even Rogers Pay, director at the Beijing-based consultancy Trivium China, this emphasis shows that policymakers view diversification as crucial for making the country's food system more secure. "(It's) a strategy to make China's food system... more resilient when shocks like natural disasters or trade wars occur," Pay noted. This approach could reduce dependence on traditional exporters and boost trade with nations in the Global South.

The Strategic Shift in Soybean Production

The policy on soybeans clearly illustrates this new focus. The directive has shifted from consolidating gains in planting area in 2025 to a new mandate of "consolidating and enhancing production capacity."

Pay suggests this change indicates a greater emphasis on improving crop yield and quality rather than simply expanding the land used for cultivation. This move is part of a broader effort to reduce reliance on US soybeans, which are primarily used for animal feed in China's massive pork industry. Since the first trade war, Beijing has actively boosted domestic production to bolster food security. As a result, the US market share for soybeans in China dropped from 41% in 2016 to just 15% in 2025.

Fostering Innovation Through Agri-Tech

The document also outlines ambitious plans to modernize the agricultural sector through technological innovation. Key initiatives include:

• Strengthening agricultural research platforms.

• Supporting leading agri-tech companies.

• Advancing industrialized biotech cultivation.

• Integrating artificial intelligence (AI) with farming practices.

• Cultivating a new generation of specialized agricultural talent.

Beyond technology, the plan aims to build internationally competitive agricultural enterprises, support key exports, and crack down on the smuggling of agricultural products while actively participating in global food governance.

Stabilizing the Domestic Meat Market

The policy blueprint also addresses challenges within the domestic meat industry, which has recently struggled with oversupply and low prices that have squeezed producer profits. The government intends to strengthen the management of pork production, a staple in the country.

Additionally, the plan calls for targeted support for the beef and dairy sectors and includes measures to promote dairy consumption. The government has already implemented policies to stabilize the industry, such as introducing a quota system for beef imports and placing tariffs on certain EU dairy products.

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George Anderson

Economic

Daily News

Remarks of Officials

Political

The U.S. House of Representatives is preparing for a tense vote on Tuesday to end the latest government shutdown, as a spending deal faces unexpected resistance from both Democrats and hardline conservatives.

While the funding package sailed through the Senate with bipartisan support and has President Donald Trump's endorsement, its passage in the House is far from certain.

What's Inside the Bipartisan Spending Package?

The legislation is designed to fund several key government functions through October. If passed, the bill would allocate funds for:

• Defense

• Healthcare and Labor

• Education

• Housing and other agencies

Crucially, it also includes a temporary funding extension for the Department of Homeland Security. This measure is intended to give lawmakers more time to negotiate potential changes to the nation's immigration enforcement policies. After clearing the House, the bill would head to President Trump's desk to be signed into law.

Dueling Demands from Democrats and Conservatives

The bill's path is complicated by an unusual alignment of opposition, with both sides of the aisle threatening to block it for different reasons.

Democrats Push for Immigration Restraints

Democrats are demanding new controls on President Trump's aggressive immigration enforcement strategies. Their position has hardened following an incident last month in Minneapolis where federal agents killed two U.S. citizens.

House Democratic Leader Hakeem Jeffries confirmed his party plans to vote "no" on an initial procedural vote Tuesday morning. However, he left the door open for some members to support the final package if it manages to clear that first hurdle.

Conservatives Demand Voter ID Rules

On the other side, a group of hardline Republicans is threatening to derail the legislation unless it incorporates new voting requirements. Their demands include provisions that would require proof of U.S. citizenship for voter registration and photo IDs for casting a ballot.

House Speaker Mike Johnson dismissed the proposal, stating that such measures do not belong in a spending bill. "Republicans are serious about governing. We'll demonstrate that," he said.

The Narrow Path to Passage for House Leadership

The political math for House Republicans is tight. With a slim 218-214 majority, they can only afford to lose a single Republican vote if Democrats remain united in their opposition.

President Trump weighed in on Monday, urging lawmakers not to amend the bill. He warned that any changes could risk prolonging the partial government shutdown that officially began on Saturday.

High Stakes: Averting Another Costly Shutdown

A swift resolution is needed to prevent widespread disruption to government services and the broader economy. The memory of the most recent government shutdown, which lasted a record 43 days in October and November, looms large.

That shutdown resulted in furloughs for hundreds of thousands of federal workers and is estimated to have cost the U.S. economy around $11 billion.

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Nathaniel Wright

Economic

Remarks of Officials

Central Bank

The Federal Reserve's recent interest rate cuts are a strategic "insurance" policy designed to protect the U.S. job market, according to Richmond Fed President Tom Barkin. Speaking on Tuesday, Barkin framed the moves as a way to support employment while the central bank navigates the "last mile" of its battle to bring inflation back to its 2% target.

Rate Cuts as a Buffer for the Labor Market

Since the fall of 2024, the Fed has approved 1.75 percentage points in rate cuts. Barkin explained these actions have "taken out some insurance to support the labor market as we work to complete the last mile to bring inflation back to target."

He noted that while the unemployment rate remains low by historical standards, inflation is still about a percentage point above the Fed’s goal but is expected to fall in the coming months.

"So far so good," Barkin said, but he emphasized the need for the central bank to finish the task of returning inflation to 2% after a nearly five-year miss.

The Urgency of Hitting the 2% Inflation Target

Barkin expressed serious concern about the persistence of high prices. "Inflation...still remains above our target. That's been the case since 2021," he stated in prepared remarks for a South Carolina education group. "I take this sustained miss seriously."

He argued that current price levels have a direct impact on future expectations, stating, "Today's inflation numbers, regardless of the 'why,' significantly influence tomorrow's inflation."

Although Barkin is not a voting member on monetary policy this year, his comments align with the Fed's current pause on further cuts. The central bank is awaiting more data confirming an expected decline in inflation, all while navigating a leadership transition following the nomination of former Governor Kevin Warsh to succeed Jerome Powell as Chair.

A Resilient Economy Expected in 2026

Looking ahead, Barkin projected that the U.S. economy will remain resilient in 2026. He anticipates "significant stimulus" from upcoming deregulation and tax reductions, which he believes will keep economic activity strong.

Business and consumer confidence also appears solid. "It's hard to imagine consumers and businesses moving to the sidelines," Barkin said. He added that corporate contacts confirm this sentiment, telling him that "demand is fine" and that "most firms I speak to still aren't doing layoffs at scale."

How Productivity Gains Are Helping Control Prices

A recent jump in productivity is providing another key support for the economy. Barkin noted that this trend helps ease inflationary pressures directly.

When productivity is high, "businesses can bear higher input costs without facing as much pressure to increase prices," he explained. This allows companies to absorb rising costs rather than passing them on to consumers.

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Ukadike Micheal

Commodity

Economic

Political

Energy

China's independent "teapot" refiners are strategically shifting their crude oil purchases, turning to discounted Iranian supplies to fill a major void left by the sudden disruption of Venezuelan oil exports. This pivot by the world’s largest crude importer follows a dramatic halt in shipments from the South American nation.

Figure 1: Chinese independent oil refineries are reportedly increasing purchases of discounted Iranian crude to offset disruptions in Venezuelan supply.

The Collapse of Venezuelan Supply

Venezuelan oil shipments to China effectively ceased after a series of events drastically altered the country's political and industrial landscape. The disruption began when US President Donald Trump imposed a blockade in December on Venezuelan oil tankers attempting to leave the country.

The situation reportedly escalated on January 3rd, when U.S. forces bombed the capital city of Caracas, abducted Venezuelan President Nicholas Maduro, and took control of the nation's oil sector. Washington subsequently announced it was placing Venezuela’s oil revenues into accounts in Qatar, to be controlled by the White House.

In the face of this uncertainty, the state-owned firm PetroChina has halted all its oil purchases from Caracas. While the White House has permitted global trading firms Vitol and Trafigura to sell up to 50 million barrels of Venezuelan oil, the direct flow to key Chinese buyers has been severed.

Iran Fills the Gap with Discounted Crude

In response to the supply vacuum, Beijing's independent refiners have ramped up their purchases of Iranian heavy crude. According to sources familiar with the matter, this oil is being sourced from bonded storage tanks within China and from ships, all at steep discounts.

Further Chinese purchases of Iranian Heavy and Pars crude grades are expected to continue through February and March. The primary driver is economic: with few willing buyers due to U.S. sanctions, Iran is offering its Heavy crude at a discount of about $12 per barrel.

A Shifting Global Oil Market

This pricing makes Iranian oil highly competitive. For comparison, Russian Urals crude also trades at a significant discount of $11 to $12 per barrel due to sanctions. Meanwhile, the Venezuelan crude being offered by Vitol with Washington's permission carries a much smaller discount of roughly $5 per barrel.

Before the disruption, China's imports from Venezuela were substantial, averaging 394,000 barrels per day (bpd) and accounting for around 4% of Beijing's total seaborne crude imports.

The geopolitical chessboard for energy continues to change. President Trump recently announced that India will begin purchasing Venezuelan oil, a move intended to help replace its Russian supplies amid U.S. tariff threats. This comes after New Delhi had previously stopped buying oil from Caracas last year after the Trump administration imposed a 25% tariff on countries doing so.

Ultimately, aggressive U.S. sanctions targeting Russia, Venezuela, and Iran have forced major energy consumers like China and India to constantly adapt their procurement strategies in a volatile global market.

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Warren Takunda

Economic

After getting battered since late last week in a dramatic sell-off, precious metals rebounded and clawed back losses on Tuesday as investors continue to digest the implications of President Donald Trump’s announcement of Kevin Warsh as the next chair of the US Federal Reserve.

Gold rose more than 3% in Asian trading to $4,822 an ounce and silver surged 5.3% to $83.50. Investors were likely drawn to the historically low prices after gold spent most of 2025 on a steady rise.

Fed nomination still cause for unease

Last week's nomination has sharpened debate over the future direction of US monetary policy and the degree of political pressure the Fed may face, prompting a swift reassessment of crowded positions across precious metals.

Spot gold fell as much as 10% in early trading on Monday, while silver plunged up to 16%, following Friday’s rout that marked the largest intraday decline on record for the white metal.

The pace of the retreat reflected how stretched positioning had become after months of relentless gains, as investors chased the rally amid heightened geopolitical tensions and expectations of easier US policy.

“Crowded one-sided trades unwind. FOMO [Fear of missing out] and chasing the rally are rarely, if ever, a case of economic fundamentals,” said Marcus Dewsnap, head of fixed income strategy at Informa Global Markets.

“Reality seems to have caught up with metals markets, after what for precious metals especially has been a parabolic rise.”

The initial trigger came late last week, when news of Warsh’s nomination sent the US dollar higher and forced investors to reprice the outlook for interest rates.

“The sharp selloff on Friday followed news that US President Donald Trump intends to nominate Kevin Warsh as the next Federal Reserve chair – a development that boosted the US dollar and reinforced expectations of a more hawkish policy stance,” said Ewa Manthey, commodities strategist at ING, and Warren Patterson, head of commodities strategy.

“While a correction was overdue after the intense rally, the scale of Friday’s decline far exceeded most expectations,” the ING report continued.

Why the Fed matters for gold

Gold and silver are particularly sensitive to US interest-rate expectations, as higher rates raise the opportunity cost of holding non-yielding assets, while a stronger dollar makes metals more expensive for overseas buyers.

Although Warsh has voiced support for aspects of President Trump’s vision for the Fed, including rate cuts, markets do not view him as an unequivocal advocate of aggressive monetary easing.

“Warsh isn’t thought to be in the dramatic US interest-rate cut camp to the extent that President Trump desires,” Dewsnap said.

“As far as Fed independence is concerned, he is currently considered a safer pair of hands than other named contenders.”

Reassessment has been swift

Investor caution has been evident in exchange-traded funds, with silver holdings falling for a seventh consecutive session to their lowest level since November 2025.

Futures data also show speculators cutting back sharply on bullish bets, signalling a broader retreat from the sector.

“CFTC positioning shows a cooling in speculative interest across precious metals,” the ING report said.

“Managed money net longs in COMEX gold fell by 17,741 lots last week… Speculators also cut net longs in silver… taking positioning to its lowest since February 2024.”

Margins rise, volatility bites

Market stress has been amplified by mechanical factors, with CME Group set to raise margin requirements on COMEX gold and silver futures after last week’s historic swings.

The move is forcing traders to post more collateral or reduce exposure, a dynamic that can accelerate sell-offs in heavily leveraged markets.

“When a market has experienced a rise well beyond anything fundamentals can explain, it doesn’t take much to open the exit door,” Dewsnap said.

“The extent of the one-sided positioning makes for what is termed a narrow exit… there aren’t enough buyers to deal with the selling cascade, which exacerbates the price drop.”

Attention is now turning to Asia, where Chinese investors have historically provided support during price dips. However, with volatility elevated, participation may be more cautious than usual.

“With volatility spiking and the Lunar New Year approaching, traders are likely to pare back positions and reduce risk,” the ING analysts said.

“Price direction in the near term will hinge on the extent of dip-buying from Chinese investors following Friday’s retreat.”

Outlook remains fragile

For now, the precious metals market remains at the mercy of macro forces, with little clarity on how quickly sentiment will stabilise.

Investors are watching US data closely for clues on real interest rates and the dollar’s next move, both of which will be shaped by expectations around the Fed’s future direction.

“Overall, volatility across precious metals is likely to remain elevated in the near term,” the ING analysis concluded.

“For gold and silver, macro uncertainty, real rate expectations, and USD direction will continue to dominate sentiment.”

Source: Euronews

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Warren Takunda

Economic

Bullied and buffeted by President Donald Trump’s tariffs for the past year, America’s longstanding allies are desperately seeking ways to shield themselves from the president’s impulsive wrath.

U.S. trade partners are cutting deals among themselves —- sometimes discarding old differences to do so — in a push to diversify their economies away from a newly protectionist United States. Central banks and global investors are dumping dollars and buying gold. Together, their actions could diminish U.S. influence and mean higher interest rates and prices for Americans already angry about the high cost of living.

Last summer and fall, Trump used the threat of punishing taxes on imports to strong-arm the European Union, Japan, South Korea and other trading partners into accepting lopsided trade deals and promising to make massive investments in the United States.

But a deal with Trump, they’ve discovered, is no deal at all.

The mercurial president repeatedly finds reasons to conjure new tariffs to impose on trading partners that thought they had already made enough concessions to satisfy him.

Just months after reaching his agreement with the EU, Trump threatened new tariffs on eight European countries for opposing his attempts to seize control of Greenland from Denmark – though he quickly backed down. And last month, he said he’d slap 100% tariffs on Canada for breaking with the United States by agreeing to reduce Canadian tariffs on Chinese electric vehicles.

“Our trading partners are discovering that the largely one-sided deals they concluded with the U.S. provide little protection,’’ said former U.S. trade negotiator Wendy Cutler, senior vice president at the Asia Society Policy Institute. “As a result, trade diversification efforts by our partners are on turbo charge, looking to reduce dependence on the U.S.’’

Trump supporters such as Paul Winfree, who was deputy director of the White House Domestic Policy Council during Trump’s first term, are wary of the relative decline in U.S. Treasury note holdings by foreign central banks and view the national debt as a vulnerability rivals would like to exploit.

Winfree, CEO of the Economic Policy Innovation Institute, a think tank, said that some of Trump’s advisers do not feel America has fully benefited from the dollar’s status as the world’s dominant currency.

“But the fact remains that every other country is jealous of our status, and many of our adversaries would love to challenge the U.S. dollar and Treasuries,” he said.

White House spokesman Kush Desai insists America’s standing on the global stage has not been diminished.

“President Trump remains committed to the strength and power of the U.S. Dollar as the world’s reserve currency,” he said.

India and the EU clinch a long-awaited deal

The most eye-opening deal so far has been the pact announced last week between the 27-country EU and India, the world’s fastest growing major economy. Negotiators had been at it for nearly two decades before they closed the agreement.

Likewise, an EU trade deal announced two weeks ago with the Mercosur nations of South America took a quarter century of negotiation. It will create a free-trade market of more than 700 million people.

“Some of these deals have been in the works for quite some time,’’ said Maurice Obstfeld, a senior fellow at the Peterson Institute for International Economics and former chief economist at the International Monetary Fund. “The pressure from Trump made them more eager to accelerate the process and reach agreement.’’

EU exporters were jubilant over the India deal. VDMA, a group of European machinery and plant engineering companies, welcomed lower Indian tariffs on machinery.

“The free trade agreement between India and the EU brings much needed oxygen to a world increasingly dominated by trade conflicts,” VDMA’s executive director, Thilo Brodtmann, said in a statement. “With this agreement, Europe is sending a clear signal in favor of rules-based trade and against the law of the jungle.”

‘We have all the cards’

On Monday, Trump went on social media to announce his own deal with India. The U.S., he posted, would reduce tariffs on Indian imports after India agreed to stop buying oil from Russia, which has used the sales to fund its four year war in Ukraine.

The president said that India would reduce its tariffs on American products to zero and buy $500 billion worth of American products. Trade lawyer Ryan Majerus, a partner at the King & Spalding and a trade official in the Biden administration and during Trump’s first term, said that businesses and legal analysts were awaiting official White House documents spelling out details of the deal.

Trump is banking on there being limits to other countries’ ability to pull away from the United States. America has the world’s biggest economy and consumer market. “We have all the cards,’’ Trump told Fox Business this month.

Countries like South Korea, dependent on America’s market and military protection, can’t afford to ignore Trump’s threats. On Monday, for example, the president said he was increasing tariffs on South Korea goods because the country’s legislature has been slow to approve the trade framework announced last year. On Tuesday, the country’s Finance Ministry responded by saying its chief, Koo Yun-cheol, would push lawmakers to quickly approve a bill to invest $350 billion as promised in the agreement.

“The U.S was trying to identify a counterpart that would find it difficult to refuse U.S. demands outright, given the depth of its economic and security ties,” said Cha Du Hyeogn, an analyst at South Korea’s Asan Institute for Policy Studies.

Or consider Canada, which sends 75% of its exports to its southern neighbor. “Canada and U.S. will always be tightly linked through international trade,” said Obstfeld, a professor at the University of California, Berkeley. “We’re talking about adjustments more or less on the margin.’’

But the world’s growing rejection of Trump’s policies is already having an impact, driving down the value of the dollar, long the currency of choice for global commerce, to its lowest level since 2022 last week versus several competing currencies.

Syracuse University political scientist Daniel McDowell, author of the book “Bucking the Buck: U.S. Financial Sanctions and the International Backlash against the Dollar,” sees a vibe shift under Trump: Foreign countries and investors want to reduce their exposure to the United States, which has moved from a source of security and stability to a driver of instability and unpredictability under Trump.

“Trump has shown that he is willing to use foreign countries’ economic dependence on the U.S. as leverage against them in negotiations,” McDowell said. “As global perceptions of the US are changing, it is only natural that investors — public and private alike — are reconsidering their relationship with the dollar.”

Source: AP

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Isaac Bennett

Remarks of Officials

Economic

Middle East Situation

Daily News

Political

The United Arab Emirates has issued a direct call for the United States and Iran to de-escalate their standoff ahead of renewed talks this week, stressing that the Middle East cannot withstand another war. The appeal comes as both sides prepare for negotiations in Turkey over Iran's nuclear program.

U.S. President Donald Trump has signaled that "bad things" could happen if a deal isn't reached, especially with U.S. warships positioned near Iran.

The UAE, a major regional power and a key U.S. ally, has made its position clear. "I think that the region has gone through various calamitous confrontations," said Anwar Gargash, an adviser to the UAE president, at the World Governments Summit in Dubai. "I don't think we need another one."

Gargash urged for direct negotiations between Washington and Tehran to resolve outstanding issues and suggested that rebuilding this relationship could help Iran's economy, which has been damaged by U.S. sanctions.

High-Stakes Diplomacy in Istanbul

Talks are scheduled for Friday in Istanbul, where U.S. Special Envoy Steve Witkoff will meet with Iranian Foreign Minister Abbas Araqchi. The primary goal is to revive diplomacy and ease fears of a new regional conflict.

According to a regional diplomat, representatives from other key countries, including Saudi Arabia and Egypt, will also participate. An official, speaking anonymously, confirmed that invitations at the foreign minister level were extended to a group of regional powers:

• Pakistan

• Saudi Arabia

• Qatar

• Egypt

• Oman

• United Arab Emirates

The priority for the meeting is to avoid conflict and de-escalate the current tensions between the U.S. and Iran.

Military Tensions and Recent History

The diplomatic push follows a recent U.S. naval buildup near Iran and a violent crackdown on anti-government protests within the country last month. While President Trump has held back from direct intervention, he has dispatched a naval flotilla to the coast and demanded nuclear concessions.

This standoff follows a U.S. strike on Iranian nuclear targets in June, which came after a 12-day Israeli bombing campaign. Since then, Iran has maintained that it has halted its uranium enrichment activities, which it claims are for peaceful purposes.

However, recent satellite images from Planet Labs of two targeted sites, Isfahan and Natanz, appear to show new roofing on two buildings that were previously destroyed. The imagery did not show other signs of rebuilding.

Iran's Internal Fears Mount

Sources within Iran suggest its leadership is increasingly concerned that a U.S. strike could destabilize its hold on power. Six current and former officials indicated that a foreign attack could drive an already angry public back into the streets.

Four officials briefed on high-level meetings reported that Supreme Leader Ayatollah Ali Khamenei was told that public anger following last month's crackdown—the deadliest since the 1979 Islamic Revolution—has eroded the government's ability to rule by fear.

Key Sticking Points in Negotiations

Last week, Iranian sources revealed that President Trump had laid out three core conditions for resuming talks:

1. Zero enrichment of uranium in Iran.

2. Limits on Tehran's ballistic missile program.

3. An end to its support for regional proxies.

Iran has consistently rejected these demands as violations of its sovereignty. However, two Iranian officials noted that the country's clerical rulers view the ballistic missile program as a greater obstacle to a deal than uranium enrichment.

One official elaborated on Iran's position: "Diplomacy is ongoing. For talks to resume, Iran says there should not be preconditions and that it is ready to show flexibility on uranium enrichment, including handing over 400 kg of highly enriched uranium (HEU), accepting zero enrichment under a consortium arrangement as a solution."

Tehran's negotiating position comes as its regional influence has been weakened by Israeli attacks on its proxies—including Hamas, Hezbollah, the Houthis, and militias in Iraq—and the ousting of its ally, former Syrian President Bashar al-Assad.

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