President Donald Trump is displayed on a television screen as traders work on the floor of the New York Stock Exchange on April 7, 2025, in New York City.  (Photo by Spencer Platt/Getty Images)

WASHINGTON — Global markets plummeted Monday for the third consecutive trading day since President Donald Trump announced his “Liberation Day” tariffs — and the administration gave mixed signals on meeting other nations at the negotiating table.

U.S. stocks reacted positively to a short-lived, incorrect report amplified on social media that Trump may pause the tariffs for 90 days, but the market plunged quickly when the White House dismissed the claim as “FAKE NEWS.”

Any upward progress was erased upon Trump’s announcement that he planned to further punish China starting Wednesday.

At about 11:15 a.m. Eastern Trump threatened to raise tariffs on China a further 50% if the country does not back down on its retaliatory 34% tax on U.S. imports by Tuesday. If left unresolved, the latest U.S.-China trade war will hit American farmers, particularly soybean producers.

Writing on his platform Truth Social, Trump said “Additionally, all talks with China concerning their requested meetings with us will be terminated! Negotiations with other countries, which have also requested meetings, will begin taking place immediately.”

The administration maintains more than 50 countries have reached out to negotiate.

U.S. Treasury Secretary Scott Bessent wrote on X that Trump has tasked him to negotiate with Japan, which could face a 24% levy beginning Thursday.

“Japan remains among America’s closest allies, and I look forward to our upcoming productive engagement regarding tariffs, non-tariff trade barriers, currency issues, and government subsidies. I appreciate the Japanese government’s outreach and measured approach to this process,” Bessent wrote on the social media platform.

“China has chosen to isolate itself by retaliating and doubling down on previous negative behavior,” Bessent added.

European Union’s stance

Meanwhile, European Commission President Ursula von der Leyen said she has offered the U.S. zero-for-zero tariffs on industrial goods.

“But we are also prepared to respond through countermeasures and defend our interests,” von der Leyen said Monday at a press conference.

Trump slapped a 20% tax on goods from the EU, set to take effect Thursday, on top of 25% tariffs on steel and aluminum that began in mid-March. A 25% tariff on all foreign cars imported to the U.S. also launched Thursday.

The EU is poised to impose retaliatory duties on American products in response to the import taxes. The bloc of 27 nations is scheduled to vote Wednesday on a list of U.S. goods to be taxed at its borders.

When asked by reporters in the Oval Office Monday if the EU offer was enough to scale back the tariffs, Trump said “No, it’s not.”

Journalists had gathered in the Oval Office for Trump’s meeting with Israeli Prime Minister Benjamin Netanyahu, who visited to discuss Trump’s new 17% tax on his country’s imports.

Netanyahu promised to “eliminate” his country’s trade deficit with the U.S.

“We intend to do it very quickly. We think it’s the right thing to do and we’re going to also eliminate trade barriers, a variety of trade barriers that have been put up unnecessarily. And I think Israel can serve as a model for many countries who ought to do the same,” Netanyahu said.

When asked by reporters if he intends to lower the tariffs on Israel, Trump said, “Maybe not.”

“We give Israel billions of dollars a year,” he added.

The meeting was streamed on C-SPAN.

‘Let’s take the deal’

Two Republican senators publicly urged Trump on social media to take the EU offer.

Sen. Mike Lee of Utah wrote, “Let’s take that deal! Much to gain.”

“Totally agree,” Sen. Ron Johnson of Wisconsin replied. “At some point you have to take YES for an answer.”

Another Senate Republican, Ted Cruz of Texas, has publicly criticized Trump’s steep levies on almost every nation around the globe.

A bipartisan effort to claw back power from the president’s near-unilateral authority to impose tariffs might not get far, despite the economic uncertainty unleashed since Trump unveiled his “Liberation Day” plan.

Legislation co-sponsored by Democrat Maria Cantwell of Washington and Republican Chuck Grassley of Iowa would require the president to notify lawmakers prior to new tariffs from the White House and limit the levies to a 60-day window unless Congress approves an extension.

Senate Majority Leader John Thune of South Dakota seemed to shut down the idea Monday, according to reporters on Capitol Hill.

“I don’t think that has a future. The president has indicated he will veto it. I don’t see how they get it to the floor on the House,” Thune told Politico.

A companion bill in the House is sponsored by Republican Rep. Don Bacon of Nebraska.

Chances of House Speaker Mike Johnson bringing the bill to the floor are likely slim, as the Louisiana Republican supported Trump’s tariff unveiling in person last week.

In the Perspectives guest blog series, Farm Foundation invites participants from among the varied Farm Foundation programs to share their unique viewpoint on a topic relevant to a Farm Foundation focus area. Michelle Klieger is a 2024 Farm Foundation Young Agri-Food Leader and president of Stratagerm Consulting. In this blog she discusses the European Union’s new deforestation regulations.

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The European Union aims to raise the global bar with new Deforestation Regulations. Effective since June of 2023, the regulations ban imported goods that stand to profit off of deforestation practices. By devaluing and even penalizing these practices, the EU hopes to create a  commodity trade standard that will reverse the effects of deforestation. They predict 177,920 acres of forests, or one quarter of Rhode Island, will be saved in 2025, and are optimistic that these steps will reduce air pollution.

Soy, palm oil, beef, coffee, and cocoa trades are expected to experience a significant impact due to these new requirements. Brazil, Argentina, Malaysia, Indonesia, Canada and parts of Africa are on edge as they consider trading options. Some argue this is the beginning of a new era, while others see it as a reorganization of supply chains.

Complexities of EU Regulations

For companies working to meet regulations, the process is complex. While individual companies must produce data to receive deforestation- free certification, entire supply chains must be vetted. Each industry faces unique obstacles.  Soy, for example, goes from farm production, and is then transported to processing facilities, then moved onto crushers, then to product manufacturers, and finally to retailers. If at any point in the process operations have made use of deforested land, the trading company could be banned from exporting goods to EU countries. Palm oil batches typically mix fruit from many sources at once. Many of these companies can only trace a product after it has been processed and would need to develop brand new traceability methods to meet requirements.

Meeting the new regulations requires an investment in technology and manpower. In order to make products fully traceable many companies are purchasing GPS technology that allows them to accurately map and consistently monitor their farms. Similarly, if products must be tracked and segregated from planting all the way to a grocery store shelf, digital tracking technology will also be needed. Guaranteeing deforestation-free methods must include in person inspections done by real people traveling from farm to farm to see operations up close. 

It’s a time consuming process to build out this framework, but one that many companies deem both valuable to the global environment and financially lucrative in the long run. Decisions involve farmers, transportation companies, processing plants and manufacturers, but they also must include government policy, technology and in some cases legal crossroads. There is no overnight shift, but rather a development of practices.

A Supply Chain Split

Already many companies are rerouting supplies to other buyers and avoiding EU regulations altogether. The trend prompts speculation that the new requirements will not raise the bar, but simply split or change the flow of supply chains. Brazil could turn to China as a new soy buyer and Indonesia could potentially trade palm oil to Africa. We’ve seen substitute shifts like these in the past with the U.S.-China trade war and sanctions on Russian energy. It may prove simpler and more cost effective to change buyers rather than invest in meeting new EU regulations. Many of these companies have little ability to enforce downline or upline adherence to regulation and they fear penalties.

Interestingly, in 2020 Brazil produced ⅓ of the world’s soy, but only 13% of crops account for 95% of the deforestation that occurred that year. The other 87% appear to have been produced on grassland and savannah areas.  The scenario is true elsewhere and begs the question; will this create a new environmental imbalance that puts stress on other ecosystems? Companies looking to meet regulations could potentially exploit approved farming areas by over farming them. 

Demand For a Different Type of Supply

Will it be harder to secure buyers or much used commodities? For the EU, value is placed not just on the product, but how it is sourced. The decision will impact both consumers and European agriculture. 

European countries are braced to experience a decreased supply of things like chocolate and coffee. But, exactly how increased operating costs will be absorbed remains uncertain. Typically consumer prices reflect production cost increases, but in this situation one or more points along a supply chain may need to take ownership of costs to ensure tradability. The result, at least in the initial stages, would be lower profit margins for most of these companies and possibly higher purchase prices for consumers.

Several European countries are seeking reduced regulations and maintain that the current requirements are virtually impossible for small and medium sized farms to accommodate. They also argue that these regulations negatively impact many of the current sustainability processes farmers are working to implement for the sake of biodiversity, crop and grazing rotations. Farmers worry that they will not be able to produce the soy meal needed to feed their own livestock and that the EU will become too reliant on exports which would negatively affect the European ag sector.

Good News For U.S. Producers

The EU is not alone. Other countries have similar environmentally focused goals and policy in the works to support these goals. The United States has seen a growing consumer demand for traceability, prompting many businesses to begin the process of leveraging technology and better communication up and down supply chains to help customers make informed decisions.

The Forest Act of 2023 was birthed out of the same desire to stabilize regions of the world that have suffered from illegal deforestation and offer opportunities for many industries and individual businesses to clean up their processes. If it goes into effect, the Forest Act would be very similar to the EU’s Deforestation Regulation; banning products that have been produced on illegally deforested land and penalizing unmet requirements.

Many American operations are positioned to receive deforestation-free certification. Several top soy producers are predicted to meet regulations and be granted access to the EU markets. A welcome relief to farmers who have faced narrowing markets in recent years. 

Exactly how competitive this “new” market will be, only time will tell.  Traceability efforts take time. Unless trade lines were already working toward deforestation-free goals, it will take years for many of these supply chains to implement methods that meet EU regulations.  In the meantime, it’s highly likely that global trade negotiations will be impacted and supply chains will shift in response to the environmental standard.

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A version of this blog originally appeared on the Stratagerm Consulting website. It is reposted with permission.

The post Perspective: European Union’s Deforestation-Free Product Regulation appeared first on Farm Foundation.