We’ll be watching today for details of some U.S.-China progress on trade.

Treasury Secretary Scott Bessent says the U.S. and China have made “substantial progress” in talks aimed at de-escalating rising trade tensions and indicated the two sides may have struck a deal. The administration is set to provide further details on the state of discussions today.

Bessent and U.S. Trade Representative Jamieson Greer spent the weekend in Switzerland holed up with Chinese officials in the first high-level talks since both sides hiked tariffs on each other’s products.

Going into the meetings, Bessent was cool on the prospects of securing a trade deal but told Fox News that the priority was de-escalating the existing trade tensions. In a statement, Greer suggested the weekend talks had progressed more rapidly than expected, however.

“It’s important to understand how quickly we were able to come to agreement, which reflects that perhaps the differences were not so large as maybe thought,” Greer said in a statement.

Why it matters: The administration has hiked tariffs on China by 145% since entering office, and China has retaliated with new 125% duties on U.S. exports. U.S. ag has been warning officials of potential export losses from the tariffs and will continue to do so this week.

But, but, but: President Donld Trump has already suggested those duties will soon come down. In a post to Truth Social, Trump suggested the U.S. rate should be closer to 80% but insisted he would leave the decision up to Bessent.

One thing that won’t be on the table though, is the 10% baseline tariff. Commerce Secretary Howard Lutnick told CNN on Sunday that he expects the baseline to remain “for the foreseeable future.”

House GOP sets committee action on reconciliation

The House Ag Committee and two other panels are set to start consideration Tuesday of their pieces of the giant budget reconciliation bill needed to enact the president’s legislative priorities.

The Ways and Means Committee will consider tax provisions that would extend and even expand some expiring provisions of the 2017 Tax Cuts and Jobs Act. 

The draft text of the Ways and Means bill would increase the Section 199A business income deduction for small businesses from 20% to 22%. The estate tax exemption would be increased from $14 million to $15 million per individual. 

For more on the reconciliation process and the rest of this week’s D.C. agenda, read our Washington Week Ahead. 

U.S.-Mexico border shut; re-evaluation in two weeks

USDA has banned the import of cattle from Mexico once again over concerns about the spread of the New World screwworm. The department says it will evaluate developments and data in two weeks.

The department is concerned that the pest has spread from the state of Chiapas on the border with Guatemala to two adjacent states.

Bottom line: The import suspension will allow USDA to “reassess whether current mitigation standards remain sufficient,” a USDA statement says. Imports were first suspended in November.

Ukrainian ambassador: New Black Sea grain deal would slow, not help, exports

The Ukrainian ambassador to the U.S. warns that renewed Russian interest in reviving a Black Sea grain deal could be a way of curbing Ukraine’s exports.

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Russian officials have reportedly expressed interest in reviving the Black Sea Grain Initiative as part of ceasefire discussions, according to reporting from Reuters last month. But Ambassador Oksana Markarova and analysts said during a panel discussion at the Danish embassy in Washington that entering a new deal would not be in Ukraine’s interests.

Ukrainian grain exports increased after the Black Sea Grain Initiative collapsed, as Russian inspections had slowed exports and military gains allowed the creation of new routes.

“We need the freedom of navigation, and we need the access to our ports,” Markarova said. “That could be done without any particular grain agreement or something which Russia might try to install in order to slow down the exports.”

Groups seek $1.2B for conservation operations at NRCS

Some 128 conservation and farm groups are urging congressional  appropriators to provide $1.2 billion to the Natural Resources Conservation Service's conservation operations account.

In fiscal 2025, the current fiscal year, $895 million is set aside for the account, which in large part includes funding for conservation technical assistance as well as money for soil and snow surveys. The account received $941 million in FY23 and again in FY24, USDA budget summaries show.

In a letter, the organizations said the funding “is critical to the effective administration of USDA conservation programs.” They added that “our country’s conservation delivery system and producers across the country depend on the availability of on-the-ground technical assistance to implement effective conservation practices.”

Take note: Trump’s fiscal 2026 budget proposes a $754 million cut to conservation technical assistance.

New postmaster general chosen

David Steiner, a FedEx board member and former CEO of Waste Management, has been chosen by the U.S. Postal Service’s Board of Governors as the new Postmaster General.

Why it’s important:  Trump has in the past expressed interest in privatizing the postal service, though it remains to be seen whether Steiner would attempt to move the organization in that direction.

National Rural Letter Carriers Association President Don Maston said in a lengthy statement that his organization is ready to work with Steiner but added that it is closely watching him due to his ties to FedEx, a private competitor. He warned against privatization, noting that rural communities would be hit hardest by the price increases that would result.

Final word

"These communities have long been among the Postal Service’s most consistent and loyal users — and among the most affected when service is reduced, or access is limited.” – Maston said of rural areas. 

Philip Brasher, Oliver Ward and Noah Wicks contributed to today’s Daybreak 

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