WHY IT MATTERS: Analysts said the April 5 attack on the ship added to risks to global food security and agricultural trade stemming from the ongoing U.S.-Israeli war against Iran.

Russian media said the vessel was carrying wheat from the Port of Azov, near the city of Rostov, to Port Kavkaz in the strait separating the Crimean peninsula from mainland Russia, where the grain is usually loaded onto larger vessels for export.

TASS quoted emergency services as saying the vessel, which was gutted by fire and began to sink, was towed to the village of Kuchugury in Russia’s Krasnodar region. A video posted by the news agency showed the vessel engulfed in flames and smoke. The agency said two badly burned bodies were found aboard the ship, bringing the death toll to three. An aide to the vessel’s captain had earlier been reported dead.

Public ship databases list Volgo-Balt 138-class vessels at about 3,165 tons deadweight.

Grain consultancy Sovecon earlier described the incident as the first known sinking of a grain-loaded ship in the Black Sea-Azov basin, a major grain-trading route, since the start of the war in Ukraine in 2022.

“Against the backdrop of Iran’s conflict and the effective paralysis of diplomacy among Washington, Moscow and Kyiv, the risk of further escalation in the region appears to have increased significantly,” Sovecon head Andrey Sizov said.

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The war, which has closed the Strait of Hormuz, has shut down fertilizer plants in the region and severely disrupted shipping routes, potentially curbing supplies to key importers around the world just as farmers in the Northern Hemisphere prepare to plant seeds.

“It’s a mess because it’s spring,” said Cedric Benoist, who farms wheat, barley and other crops south of Paris, referring to global fertilizer prices that have jumped by dozens of euros per metric ton. “This situation can’t continue.” Farmers from Srinagar in Kashmir to Saskatchewan in Canada rely on fertilizer and diesel shipped through the strait, the conduit for about one-third of global trade in fertilizer and 20 per cent of the world’s export fuels.

Because of a global grains glut, many farmers were already expecting to lose money on this year’s crop. Now the outlook is especially gloomy for farmers who still need to buy spring fertilizer, like Jeff Harrison of Quinte West in Ontario. “We’re in a real bad situation now,” Harrison said.

Prices in the United States, which imports much of its fertilizer needs despite a large domestic industry, rose at the war’s outbreak. Prices for fertilizer jumped from $516 (C$706) per metric ton on Friday to up to $683 (C$934) at the import hub of New Orleans on Thursday. Prices could jump higher if the Persian Gulf closure persists and shipments can’t make it in time for spring planting, analysts told Reuters.

“Literally, this could not happen at a worse time of the year,” said StoneX analyst Josh Linville.

World’s largest single-site urea plant shuts down

Seth Meyer, former U.S. Department of Agriculture chief economist and now at the Food and Agricultural Policy Institute, said farmers might alter crop choices and fertilizer applications due to the price spike.

Farmers need fertilizers for virtually all their crops if they want a good yield, but each crop and the soil they are grown in have different demands.

Farmers could cut back on corn, which requires high rates of nitrogen fertilizer, or else sharply reduce fertilizer application rates, Meyer said.

Shipments from the Middle East are likely to drop not only because transit through the Strait of Hormuz has all but stopped, but also due to cuts in production.

Qatar Energy has had to stop production at the world’s largest single-site urea plant, as it lost its source of natural gas feedstock after the company shut down gas output due to attacks on its LNG facilities.

At the same time, sulfur output has been cut in other parts of the Middle East.

“We have lost a significant chunk of the global supply because of this situation,” Linville of StoneX said.

India buys more than 40 per cent of its urea and phosphatic fertilizers from the Middle East. While imports could be hit, output within India has already been affected.

Three Indian plants have been forced to reduce urea output as LNG supplies from Qatar have dropped sharply, said a New Delhi-based senior industry official. As a result, supply is expected to be tight for urea and diammonium phosphate in the short term, the person said.

Fertilizer market tight before war

The global fertilizer market was already tight, with China restricting exports this year to ensure domestic availability, while producers in Europe have cut output due to the loss of cheap Russian gas supply, analysts said.

Urea prices had risen by around $80 (C$109) per ton from around $470 per ton quoted before the start of the Iran war, they said.

China is likely to expand fertilizer export controls because of the conflict, two agricultural analysts said, although the restrictions may not be formally announced and instead communicated to major producers and customs.

While China sources more than 50 per cent of its sulfur imports from the Middle East, Indonesia relies on the region for nearly 70 per cent of its supplies, traders said. Sulfur is a key ingredient for phosphate fertilizers like diammonium phosphate and monoammonium phosphate.

“It is really hard to find readily available spot cargoes now. There are no spot cargoes anywhere,” said one Chinese sulfur trader.

Australia is dependent on imports to meet most of its fertilizer needs, say industry analysts.

“Another nail in the coffin”

Agricultural economist Corne Louw of GrainSA, which represents South African farmers, told Reuters that fertilizer can make up as much as 50 per cent of their production costs.

“Any increases in the current situation where farmers are already struggling with record low grain prices will just be another nail in the coffin,” he said.

Markets might not yet have fully priced in the possibility of a long war, according to Morningstar analyst Seth Goldstein, who estimates that nitrogen prices could roughly double and phosphate prices rise 50 per cent from current levels.

“If the supply shock lasts more than a few weeks, I wouldn’t be surprised to see prices go back to the highs of 2022, when the Russia-Ukraine conflict began,” Goldstein said.

— Additional reporting by Lewis Jackson, Daphne Zhang and Amy Lv in Beijing, Trixie Yap in Singapore and Rajendra Jadhav in Mumbai, Tristan Veyet in Gdansk, Gus Trompiz in Paris, Wendell Roelf in Johannesburg and Nigel Hunt in London.

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Markets have reacted to the global impact of closing this incredibly busy shipping channel, focusing on the risk to oil and gas flows, the prospect of higher crude prices and the inflationary pressures that would follow.

That concern is justified. But it captures only part of the story. A sustained disruption of traffic through Hormuz would not simply constitute an energy crisis. It would also represent a fertilizer shock (where prices go up dramatically and supply goes down) – and, by extension, a direct risk to global food security.

WHY IT MATTERS: A third of globally traded urea passes through the Straight of Hormuz. The Persian Gulf also offers access to some of the world’s cheapest natural gas, which is essential for ammonia production.

Modern agriculture runs not only on sunlight and soil, but on natural gas. When German chemists Fritz Haber and Carl Bosch developed their nitrogen fixation method in the early 20th century, they did more than just manufacture ammonia at scale.

They launched a global chemical revolution that remains a cornerstone of modern civilization and agriculture. Through this process, methane is transformed into ammonia, and ammonia into nitrogen fertilizers such as urea – the most widely used nitrogen fertilizer. Those fertilizers allow crops to reach the yields on which today’s global population depends. Without it, harvests of wheat, maize and rice would fall dramatically.

Around a third of globally traded urea passes through the Strait of Hormuz. The Persian Gulf sits at the centre of this system for two structural reasons. First, it offers access to some of the world’s cheapest natural gas, essential for ammonia production.

Second, over decades, vast capital investments have built ammonia and urea capacity in countries within the region, including Qatar, Saudi Arabia, and the United Arab Emirates. This is aimed at the export market. A significant share of globally traded nitrogen fertilizer – and the liquefied natural gas (LNG) that powers fertilizer plants elsewhere – must therefore travel through the Strait of Hormuz. A closure of the strait would threaten not only oil and gas exports but also the physical flow of nitrogen-based fertilizers and what is needed to make them.

The immediate effect would be delays to shipments of ammonia, urea and LNG. They could be stopped completely or become prohibitively expensive through higher freight and insurance costs. But the deeper impact would unfold in the months ahead at farms around the world.

In the northern hemisphere, fertilizer purchases accelerate before planting seasons. A delay of weeks can be disruptive; a disruption of months can make a huge difference. If shipments fail to arrive on time, farmers face difficult choices such as how to pay sharply higher prices, reduce application rates, or alter crop mixes. Because of how crops respond, even modest reductions in nitrogen use can produce disproportionately large declines in yield. That could translate into millions of tonnes of lost crops. The consequences would ripple through global supply chains into feed markets, livestock production, biofuels and ultimately retail food prices.

Do countries not have their own supplies?

Some countries have supplies of fertilizers, but self-sufficiency is rarer than it appears. India, for instance, relies heavily on LNG imports from the Persian Gulf to run its domestic urea plants. Brazil depends substantially on imported nitrogeon and phosphate fertilizers to sustain soybean and maize production.

Even the United States, one of the world’s largest fertilizer producers, imports meaningful volumes of ammonia and urea to help meet regional demand and reduce prices. In sub-Saharan Africa, use of fertilizer is already low. A further rise in prices is likely to reduce use even more, cutting yields and increasing food insecurity.

The system’s fragility extends beyond nitrogen. Sulphur – as an essential nutrient for plant growth – is largely a byproduct of oil and gas processing. If energy shipments through Hormuz are disrupted, sulphur output falls alongside fuel exports. So, the shock would not only reduce fertilizer shipments but also restrict ways to produce them elsewhere.

Meanwhile, the production of synthetic nitrogen tightly coupled to energy markets because it is manufactured continuously from natural gas. A disruption in gas supply or ammonia trade immediately constrains global nitrogen availability. Estimates suggest that without synthetic nitrogen, the world could feed only a fraction of its current population. The Strait of Hormuz therefore sits at the intersection of energy and food security.

Changing where fertilizer is produced cannot happen overnight. Financing and constructing new ammonia plants takes years. A double-digit contraction in exports from a key region cannot be swiftly offset. In the interim, prices would rise, trade flows would re-route and planting decisions would be made under uncertainty. Food price inflation, historically correlated with social unrest, could intensify.

Central banks, focused primarily on fuel-driven inflation, could underestimate the contribution of fertilizer scarcity to prices overall. Crucially, fertilizer shocks do not register with the same immediacy as oil shocks. Petrol prices change overnight. Crop yields reveal themselves months later. Yet the latter may prove more destabilising.

Controls and closure of this narrow maritime chokepoint would reshape the cost-of-living well beyond the Persian Gulf.

If the 20th century taught policymakers to fear oil embargoes, the 21st should teach them to fear a fertilizer shock. Energy markets can absorb shocks through reserves and substitution. But the global food system has far thinner buffers. A prolonged disruption at Hormuz would not simply reprice crude; it would test the resilience of the industrial nitrogen cycle on which modern civilisation depends.

Oil powers cars. Nitrogen powers crops. If the Strait of Hormuz closes, the most consequential price may not be Brent crude but the cost of feeding the world.

—Nima Shokri is a professor in applied engineering at United Nations University. Salome M. S. Shokri-Kuehni is a lecturer in environmental engineering at United Nations University and Technical University of Hamburg.

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Shipping through the Strait of Hormuz, a vital global transit chokepoint, has been disrupted after U.S.-Israeli strikes on Iran, rattling markets and constraining trade flows through the narrow route that connects Gulf exporters with global buyers.

“While there has been a limited impact on our ocean-going vessels, Bunge’s teams are closely monitoring the situation,” the spokesperson said.

On Wednesday, Canadian agrichemical company Nutrien said it was closely engaged with customers as conditions in the Middle East region continue to evolve.

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The temporary truce in the U.S.-China trade war, announced on Monday, would not help U.S. farmers revive soy sales in China as Chinese duties, even reduced to 10 per cent from 145 per cent, remained too high to make U.S. soybeans competitive, analysts and exporters said on the sidelines of the GrainCom conference in Geneva.

Why it matters: The trade dispute with China threatens U.S. farmers’ market share for soybeans in that country — market share that has already diminished due to past tensions with China.

U.S. soybean exports could slump to 1.5 billion bushels from an initial estimate of 1.865 billion without a substantive deal, AgResource President Dan Basse said.

Meanwhile U.S. corn exports could shed 13 per cent to 2.4 billion bushels, he said.

“It’s important that any U.S.-China trade deal happens by late summer or the export forecast will become reality, pressuring U.S. farm income. The clock is ticking,” Basse told Reuters.

Prices would also take a hit. In the absence of a deal, Basse sees U.S. soybean futures on the Chicago Board of Trade falling as low as $9 per bushel, compared to $10.6 a bushel traded on Wednesday.

In contrast, if a deal brought tariffs back to their previous level, soybean prices could surge as high as $13 a bushel, he added.

“We are creating a major advantage for other origins, mainly Brazil, and origins like Argentina,” Alejandra Casillo, president of the North American Export Grain Association, told Reuters, adding that even a 10 per cent tariff would halt U.S. grain exports to China.

China has been a critical market for U.S. farmers, representing more than half of U.S. soybean exports in the most recent marketing year.

However, American farmers worry the tariff pause will not be enough to help them, as Brazil, the biggest soy supplier to China, has ample supplies from a record harvest, lower prices, and its farmers do not face any Chinese tariffs.

China, the world’s largest crop importer, already sources roughly 70 per cent of its soybean imports from Brazil.

Corn and wheat would fall as low as $3.70 for corn from $4.40 on Wednesday, and $4.90 from $5.56 for wheat, he said.

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The monsoon delivers nearly 70 per cent of the rain needed to water crops and recharge reservoirs and aquifers. With nearly half of the country’s farmland without any irrigation, it depends on the June-September rains to grow a number of crops.

Why it matters: India is a major destination for Canadian crop exports

Good rains will help to bring down food prices, to keep inflation at the central bank’s comfort level, and to allow the world’s biggest rice exporter to ship more of the staple.

The monsoon, which usually arrives over the southern tip of Kerala state around June 1 and retreats in mid-September, is expected to reach 105 per cent of the long-term average this year, M. Ravichandran, secretary in the Ministry of Earth Sciences, told a news conference.

The India Meteorological Department defines average or normal rainfall as ranging between 96 per cent and 104 per cent of a 50-year average of 87 cm (35 inches) for the four-month season.

Above-average rainfall is very likely over most parts of the country, except for some areas over northwest India, northeast India, and southern Peninsular India, where below-average rainfall is likely, Ravichandran said.

The El Niño weather phenomenon, which usually leads to below normal monsoon rains, is unlikely to occur during the four-month-long monsoon season, said Ravichandran.

In 2024, India received 107.6 per cent of its long period average rainfall, against a forecast of 106 per cent.

Steady agricultural growth will boost rural consumption and keep inflation near the Reserve Bank of India’s estimate, enabling flexibility in rate cuts amid global volatility, said Aditi Gupta, economist at Bank of Baroda.

The RBI lowered its key repo rate last week for a second consecutive time and changed its monetary policy stance, signalling room for more cuts ahead as it seeks to boost the sluggish economy in the face of fresh U.S. tariffs.

India is the world’s biggest exporter of rice and onions, and the second-biggest producer of sugar. Following surplus rainfall in 2024, India lifted curbs on rice and onion exports but allowed limited sugar exports of 1 million tons.

“Above-average rains for the second year will help New Delhi increase sugar, rice and onion exports. It will also help reduce edible oil imports,” said a Mumbai-based dealer with a global trade house.

The world’s largest importer of edible oils, India currently fulfils nearly two-thirds of its demand through overseas purchases of palm oil, soyoil and sunflower oil, primarily from Indonesia, Malaysia, Argentina, Brazil, Russia, and Ukraine.

— Additional reporting by Siddhi Nayak

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Key points:

• U.S. President Donald Trump has said he will temporarily lower new tariffs on many countries for 90 days to allow time for negotiation
• Asian buyers are reducing purchases of U.S. agricultural goods as planned fees on China-linked ships are set to raise shipping costs
• China has already reduced its reliance on American commodities like soy and corn in favour of domestic production and sources like Brazil
• The European Union is set to roll out counter-tariffs in stages, including on U.S corn, wheat and barley
• Ukraine says its set to benefit from reduced U.S. soy, corn imports to Europe

Trump temporarily lowers tariffs

President Donald Trump on Wednesday said he would temporarily lower new tariffs on many countries, even as he raised them further on imports from China, in a sudden reversal that sent U.S. stocks sharply higher.

Trump’s announcement came less than 24 hours after steep new tariffs kicked in on imports from dozens of trading partners. The new trade barriers have hammered markets, raised the odds of recession and prompted retaliatory responses from China and the European Union.

Trump said he would raise the tariff on Chinese imports to 125 per cent from the 104 per cent level that took effect at midnight, further escalating a high-stakes confrontation between the world’s two largest economies.

Trump said he would at the same time suspend targeted tariffs on other countries for 90 days to allow time for U.S. officials to negotiate with countries that have sought to reduce them.

Rollins hopeful for new deals

New deals could be struck with over tariffs “perhaps even by the end of the week,” U.S. Agriculture Secretary Brooke Rollins told Fox News on Tuesday as the country’s self-made trade war threatened markets for American farm goods.

“I believe, sincerely, it will be sooner rather than later,” Rollins said, adding that 70 countries had reached out to the U.S. for talks.

Wednesday, China and the European Union announced new trade barriers for U.S. goods. The EU imposed 25 per cent tariffs on a range of imports in retaliation for 20 per cent tariffs on most products, and higher levies on autos and steel.

China ratcheted up its duties on U.S. imports to 84 per cent from 34 per cent. This new levy adds to the 10-15 per cent tariffs China imposed in early March on approximately $21 billion worth of American agricultural and food products.

American tariffs totaling 104 per cent on Chinese imports took effect Wednesday.

Asian buyers backing off U.S. farm goods

Asian buyers are reported to be reducing purchases of U.S. agricultural goods as Washington’s planned fees on China-linked vessels and sweeping tariffs on key regional trading partners stoke uncertainty and dampen appetite for American products.

President Donald Trump’s plan to revive U.S. shipbuilding using port fees of up to $1.5 million (C$2.1 million) on China-linked ships has forced exporters to hunt for non-Chinese ships. This has driven up freight costs.

“As of now, most importers are not taking the risk of importing from the U.S.,” a Singapore-based trader at an international company which sells U.S. grains and oilseeds into Asia told Reuters. “Shipping costs have gone up and there is so much uncertainty over the trade war.”

China is the largest importer of U.S. agricultural products, but other Asian countries including Japan, South Korea and Thailand also buy significant volumes of U.S. wheat, corn, and soybean meal.

Traditional U.S. wheat buyers like Japan and South Korea are expected to continue purchasing American cargoes, however they may buy some corn and soybeans from alternative suppliers in South America and the Black Sea region.

China is set to receive about 3 million metric tons of U.S. soybeans in April-May, Reuters reported on Wednesday. Most of the soy was purchased by state stockpiler Sinograin, which is likely to have to absorb the tariff costs itself.

Irreplaceable market

U.S. agricultural exports to China declined sharply after Trump, in his first term, slapped tariffs on Chinese solar panels and other goods. China retaliated with tariffs on some industrial goods and agricultural products like fruits, nuts, pork and soybeans.

Beijing has diversified its agricultural imports since then, ramping up purchases from Brazil and boosting domestic production. However, it remains the largest export market for American farmers. U.S. farm leaders and traders have described China as “irreplaceable” even as they look for alternative markets.

China imported $29.25 billion (C$41.47 billion) worth of U.S. agricultural products in 2024, a 14 per cent decline from the previous year, extending a 20 per cent drop in 2023.

About half of U.S. soybeans, the country’s largest agricultural export to China, were shipped to the Asian nation in 2024, totaling $12.8 billion in trade, according to U.S. data.

China has increasingly relied on cheaper Brazilian soybeans to reduce its dependence on U.S. supplies. This has resulted in the U.S. market share in China dropping to 21 per cent in 2024 from 40 per cent in 2016, according to Chinese customs data.

China’s imports of U.S. corn fell to $561 million in 2024 from $2.6 billion a year earlier as domestic production increased. While China’s corn demand has grown over the past decade, Brazil has rapidly surpassed the U.S. as China’s leading supplier.

China is also a key market for U.S. exports of chicken legs, pork ears and offal — products for which there is little demand in the United States. China bought $2.54 billion of meat and offal from the U.S. in 2024, down from $4.11 billion in 2021.

EU launches countermeasures

The European Union will launch its first countermeasures against U.S. President Donald Trump’s tariffs next week, the bloc’s members agreed on Wednesday.

The European Union will put in place duties mostly of 25 per cent on a range of U.S. imports from next Tuesday in response specifically to the U.S. metals tariffs. The bloc is still assessing how to respond to the car and broader levies.

The U.S. imports include corn, wheat, barley, rice, motorcycles, poultry, fruit, wood, clothing and dental floss, according to a document seen by Reuters. They totaled about 21 billion euros (C$32.8 billion) last year.

The levies are to take effect in stages – on April 15, May 16 and a final stage on almonds and soy beans on December 1.

“These countermeasures can be suspended at any time, should the US agree to a fair and balanced negotiated outcome,” the European Commission said in a statement.

Ukraine may increase its soybean exports to the European Union if the trade conflict between the U.S. and the EU escalates, Ukrainian farm producers union UAC said on Wednesday.

“If the situation with duties between the U.S. and the EU escalates, it is likely that European demand will be redistributed in favour of Ukrainian soybeans,” UAC said in a statement.

“Europe is already increasing its purchases from Ukraine, and this trend is likely to intensify in the coming months,” it noted.

Ukrainian agricultural analysts said last week that Ukraine-origin corn, a key commodity in the country’s grain sector, could benefit from the tariffs imposed by the U.S., as it is able to partially substitute for U.S. corn if retaliatory sanctions are imposed.

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That is the backdrop for this week’s S&P Global TPM container shipping and supply chain conference in Long Beach, California, an annual event that marks the start of container shipping contract negotiating season.

Attendees this year include industry heavyweights like container carriers MSC, Maersk and Hapag-Lloyd, marquee customers including Walmart, and major logistics firms including DSV and DHL.

Why it matters: Canadian agricultural goods are shipped all around the world, and Canada is at a freight disadvantage in many markets compared to some competitors

These companies will be grappling with the ripple effects of increased protectionism, which could reduce international trade while weakening the negotiating position of massive container ship owners that have drawn robust profits and for years held the upper hand in pricing.

Trump has already slapped an additional 10 per cent tariff on goods from China, the world’s largest exporter, and has proposed million-dollar port entry fees for Chinese-built ships.

As early as Tuesday, the U.S. could impose 25 per cent tariffs on familiar goods like avocados and tequila from Mexico, and beef, lumber and oil from Canada.

Trump has threatened to levy an additional 10 per cent tariff on Chinese goods. His administration also plans new or higher tariffs on steel and aluminum and has floated 25 per cent duties on products from the European Union.

“Unprecedented uncertainty is all around,” said Peter Sand, chief analyst at transportation pricing platform Xeneta.

The world’s biggest importer’s shift away from free trade hits as global supply chains are managing higher costs from global warming-fueled severe weather and routing ships away from the Suez Canal to avoid attacks by Iran-backed Houthi militants in support of Palestinians in Gaza.

U.S. container imports of everything from plastic toys to machine parts have surged, in part due to early purchases to avoid tariffs. But trade experts warn that a pullback is likely once new import taxes kick in, targeted nations retaliate, and inflation-weary shoppers absorb the brunt of tariff-related cost increases – something that could pressure shipping demand and prices.

The Drewry World Container Index’s spot rate for a 40-foot container was (US) $2,629 as of Thursday, 75 per cent below the pandemic peak of $10,377 in September 2021 and lowest since May 2024.

“The geopolitical landscape has of course become more complex which could lead to wild swings for freight rates in either direction, but our base case is for a moderation throughout 2025,” Jefferies analysts said in a recent note.

In another move that has set off alarms around the globe, the U.S. Trade Representative on Feb. 21 proposed hefty fees on Chinese-built vessels entering U.S. ports under a union-supported plan to spur U.S. shipbuilding.

Under the proposal, a vessel owned by Chinese maritime transport operators including state-owned COSCO would pay a port entrance fee of up to $1 million per vessel. The fee for other operators using Chinese-built ships could top out at $1.5 million.

The change could benefit Taiwanese and South Korean liner operators. Still, experts warn it will have a major impact on container carriers and could translate into steeper consumer prices for goods from toys and clothing to food and fuel.

“The economic burden on U.S. exporters and importers will be huge,” container shipping expert Lars Jensen said on LinkedIn.

“The actions taken by the U.S. administration over the past four weeks are unprecedented in scope and scale.”

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The success of the International Longshoremen’s Association in winning Trump’s support for its anti-automation battle could be instructive for unions facing contract renewals during his term, including the United Auto Workers, UPS Teamsters and the U.S. West Coast’s International Longshore & Warehouse Union.

The deal, announced on Wednesday night, must be ratified by some 45,000 members of ILA and the United States Maritime Alliance (USMX) employer group.

“This is a six-year détente in the tech-versus-labor tug-of-war at U.S. ports,” said Judah Levine, head of research at Freightos CRGO.O, a freight-booking and payments platform.

It landed days before an extended Jan. 15 deadline, averting a second strike that could have put a huge dent in the economy at the start of Trump’s second term on Jan. 20.

Father-and-son ILA leaders Harold and Dennis Daggett late on Wednesday called Trump a hero to the union and gave him “full credit” for the resolution of talks.

They pointed to a Truth Social post in mid-December, where Trump appeared to side with the union’s struggle against “foreign” employers after meeting with those ILA leaders.

“I’ve studied automation and know just about everything there is to know about it. The amount of money saved is nowhere near the distress, hurt and harm it causes for American Workers, in this case, our Longshoremen,” Trump wrote.

The employer group, which includes Maersk’s APM Terminals and the U.S. arms of major container carriers such as China’s COSCO Shipping, said the agreement came “thanks in large part to President Trump’s leadership.”

The ILA and USMX extended their bargaining deadline after a deadlock over automation sparked a three-day strike in October at major ports including New York and New Jersey, Houston and Savannah, Georgia.

President Joe Biden played a vital role in helping workers win a 62 per cent raise over six years, which ended the October strike.

Biden praised both the union and employers for reaching a tentative deal on Wednesday. Trump has not commented on Truth Social and his transition team did not immediately comment.

One pro-labor attorney cautioned against interpreting Trump’s post on automation as union support, saying that it was in keeping with his pugilistic approach to international policies.

“It supports his narrative of going after foreigners,” said Cathy Creighton, an attorney and director of Cornell University’s School of Industrial and Labor Relations in Buffalo.

— Reporting by Lisa Baertlein in Los Angeles and Daniel Wiessner in Albany, New York

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Speaking to a crowd of supporters in Arizona, Trump also said he would not let the canal fall into the “wrong hands,” warning of potential Chinese influence on the passage.

After the event, he posted an image on Truth Social of an American flag flying over a narrow body of water, with the comment: “Welcome to the United States Canal!”

“Has anyone ever heard of the Panama Canal?” Trump said at AmericaFest, an annual event organized by Turning Point, an allied conservative group. “Because we’re being ripped off at the Panama Canal like we’re being ripped off everywhere else.”

“It was given to Panama and the people of Panama, but it has provisions,” Trump said of the canal, which was once owned by the United States but was handed over to Panama decades ago.

“If the principles, both moral and legal, of this magnanimous gesture of giving are not followed, then we will demand that the Panama Canal be returned to us, in full, quickly and without question.”

In a recorded message released by Panama’s President Mulino on Sunday afternoon, the nation’s leader said that Panama’s independence was non-negotiable and that China had no influence on the canal’s administration. He also defended the passage rates Panama charged, saying they were not set “on a whim”.

China does not control or administer the canal, but a subsidiary of Hong Kong-based CK Hutchison Holdings has long managed two ports located on the canal’s Caribbean and Pacific entrances.

The United States largely built the canal and administered territory surrounding the passage for decades. But the United States and Panama signed a pair of accords in 1977 that paved the way for the canal’s return to full Panamanian control. The United States handed over control of the passage in 1999 after a period of joint administration.

“Every square meter of the Panama Canal and the surrounding area belongs to Panama and will continue belonging (to Panama),” Mulino said in his statement, which was released on X.

Trump then responded to Mulino: “We’ll see about that!”

The waterway, which allows up to 14,000 ships to cross per year, accounts for 2.5 per cent of global seaborne trade and is critical to U.S. imports of autos and commercial goods by container ships from Asia, and for U.S. exports of commodities, including liquefied natural gas.

It is not clear how Trump would seek to regain control over the canal, and he would have no recourse under international law if he decided to make a play for the passage.

This is not the first time Trump has openly considered territorial expansion.

In recent weeks, he has repeatedly mused about turning Canada into a U.S. state, though it is unclear how serious he is about the matter. During his 2017-2021 term, Trump expressed interest in buying Greenland, an autonomous territory of Denmark. He was publicly rebuffed by Danish authorities before any conversations could take place.

Trump repeated the idea on Sunday, in a statement announcing his pick for ambassador to Denmark, Ken Howery, a former ambassador to Sweden.

“For purposes of National Security and Freedom throughout the World, the United States of America feels that the ownership and control of Greenland is an absolute necessity,” he wrote on Truth Social.

— Reporting by Gram Slattery in West Palm Beach, Florida, and Alexandra Ulmer in Phoenix; Additional reporting by Diego Ore in Mexico City and Elida Moreno in Panama City.

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