With the U.S. government once again on the brink of a partial shutdown, Senate Democrats are refusing to fund the Department of Homeland Security (DHS) following a fatal immigration enforcement incident in Minnesota. Senate Minority Leader Chuck Schumer said on Saturday that his party won't support any budget deal that includes DHS funding, escalating the political standoff just days before the January 27 deadline.

A shutdown would be more limited than the one in fall 2025. Funding for the USDA, Interior, Commerce, and Justice Departments, as well as the EPA, was passed in previous bills. However, other unresolved measures-especially those related to agriculture, biofuels, and trade policy-are hanging in the balance.

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One casualty of the budget battle is the stalled push for year-round E15 ethanol sales. The House-passed bill that would have legalized year-round sales of the fuel blend was dropped from final negotiations after small refiners objected to provisions limiting exemptions under the Renewable Fuel Standard (RFS).

The dispute reflects a widening rift between major oil and gas firms, who support revamping the SRE (Small Refinery Exemption) system, and independent refiners and unionized workers, who argue that changes to SREs would raise fuel production costs. The Fueling American Jobs Coalition praised Congress for halting "a sweeping policy change," while the American Petroleum Institute is still pushing for E15 legislation to return.

Amid the national unrest triggered by the immigration shooting, agribusiness giants including Cargill, CHS, General Mills, Hormel, and Land O'Lakes joined a statement from the Minnesota Chamber of Commerce urging federal and local authorities to deescalate tensions.

Meanwhile, the National Governors Association, led by Oklahoma Gov. Kevin Stitt and Maryland Gov. Wes Moore, called for collaborative law enforcement strategies between state and federal governments. "Clarity of purpose is essential," their statement reads, emphasizing transparency and local alignment in federal actions.

Former President Donald Trump reignited trade tensions by threatening to impose 100% tariffs on Canadian goods if Canada finalizes any trade agreement with China. Trump accused Canadian Prime Minister Mark Carney of turning Canada into a "Drop Off Port" for Chinese products.

Carney has denied intentions to form a free trade agreement with China, stating that the recent tariff-lowering deal only applies to select Chinese electric vehicles in exchange for improved Canadian ag export access. However, Trump's remarks signal renewed trade pressure on agricultural commodities, especially as USMCA renegotiations loom later this year.

More ag policy flashpoints

• Right to Repair: USDA's Stephen Vaden criticized equipment makers like John Deere for restricting independent farm repairs and parts sourcing, aligning with FTC efforts to defend farmer repair rights.

• Endangered Species Conflict: A bill to delist the Mexican gray wolf from the Endangered Species Act is moving through the House, drawing sharp lines between livestock advocates and conservationists.

• Gene-Edited Livestock: Canada has approved the sale of gene-edited pigs resistant to PRRS, echoing a U.S. approval from April. The pigs, developed by PIC, are a major biotech milestone for the pork industry.