🌎 Rice Crisis

Good morning. We hope you aren’t getting your pipes cleaned because it’s National Hug A Plumber Day. Today, we’ll go over Japan’s urgent rice crisis, scientists’ mission to grow space food, and people wagering their money on… the next Pope?

Sit back, relax, and enjoy today’s edition.

— Chase Goepfert, Founder

Trump looking to “substantially” reduce tariffs as trade war with China grows

Wall Street is waiting on the edge of its chair for this one. After economic tension and reciprocal tariff increases between the two largest economies in the world, President Donald Trump indicated earlier this week that he was willing to significantly lower tariffs on Chinese exports.

Tariff troubles

Earlier this month, the US increased tariffs on Chinese products to 145%, leading China to impose a 125% counter-tariff along with other actions, including limiting the exports of rare-earth minerals to the US.

The ongoing tensions between the world's largest economies have disrupted global markets and trade, prompting officials to finally initiate de-escalation talks. Here’s what the US has in mind:

• While discussions are evolving, the overall tariff rate on Chinese goods might be lowered to 50%, a substantial reduction from the current 145%.

• For Chinese imports unrelated to national security, trade officials are considering reducing the tariff to 35%, per the WSJ.

Looking forward: Earlier this week, Chinese officials said they were ready to begin trade negotiations, but not in the face of ongoing US tariff threats. The S&P 500 jumped 2% after Trump’s announcement, hinting at a possible rebound if the two nations can come to an agreement.

Why stop now?

The tariff escalations have prompted investors, world leaders, and everyday people to panic as economic uncertainty and fears of a possible recession run wild. Additionally, the stock market has been in a free fall, with the S&P 500 declining every week since the initial tariff announcement.

• Trump’s most recent statement comes after he met with retail giants, including Target, Walmart, and Home Depot, to hear their concerns regarding cost increases and dwindling supplies.

Both sides are looking to stop the bleeding: US-China shipping has dropped 60% in the weeks since the most recent tariffs on China were imposed, per Flexport data.

Japan imported rice from South Korea for first time in 25 years amid record prices

Now you know why your onigiri tastes a bit different. For the first time in a quarter of a century, Japan imported the staple food from South Korea in an effort to address soaring grain prices and a rice shortage.

Rice reserve

Rice is everywhere in Japan and is eaten in almost every meal; from sweets to sushi to alcohol, the grain is a cornerstone of Japanese culture and cuisine. However, the food is such a staple that even the slightest bump in the supply chain can cause a rice crisis:

• Poor weather, record heatwaves, and national disaster warnings led many to panic-buy the beloved grain, pushing prices up.

• Supermarkets were forced to impose buying limits as their stock disappeared.

• Last year, the average cost of a 132-pound bag increased to nearly $160, a 55% increase from two years prior, government data shows.

The rising prices became so urgent that the Japanese government tapped into its contingency reserve for the first time in history, selling 165,000 tons of rice. That’s equal to nearly two billion bowls, and only accounts for around one-fifth of Japan’s entire rice reserve.

Needless to say, that didn’t solve the problem.

Rice replacement

Foreign rice isn’t preferred in Japan, and domestic strains have always been a proud pillar of nationalism. That being said, when grain prices more than doubled earlier this month, Japanese consumers decided to betray their taste buds.

• South Korean suppliers sent two tons of rice to Japan, with an additional 20 tons on the way, a sliver of Japan’s consumption.

• South Korea’s rice exports to Japan are expected to reach their highest levels since 1990, when there was also a crisis, according to the Yonhap News Agency.

The US may also have an opportunity: The crisis has potentially opened the door for US producers, as Japan is reportedly considering lowering import restrictions on American rice and soybeans.

Drugmakers are panicking as Trump seeks to lower drug prices for Americans

The vast majority of Americans want lower drug prices. Pharmaceutical companies are scrambling as the Trump administration considers lowering US medicine prices to the international standard, calling it the “industry’s top concern.”

Pill policy

The potential policy aligns with an executive order President Trump signed last week (see here), which outlines a series of actions intended to lower prescription drug prices for Americans.

• The order is largely focused on expanding Medicare drug price negotiation, which has long been a hot-button issue for Americans.

• 90% of Democrats, 93% of Republicans, and 95% of Independents want Medicare to have the ability to negotiate with drug makers for lower prices, according to an AARP study.

The executive order poses a threat to pharmaceutical companies’ profits, along with other possible moves by the Trump administration, such as imposing tariffs on imported medicines.

However, a new policy being thrown around by US health officials has the drug-making sector on high alert, with one source calling it an “existential threat to the industry.”

Americans pay a lot

The United States currently pays the most for prescription drugs out of any country in the world, typically shelling out more than three times the price of other developed nations. The Trump administration wants to close that gap:

• Lowering US drug prices to the international standard paid by other developed countries is called international reference pricing.

• While the policy was missing from Trump’s executive order last week, analysts say Medicare’s drug price negotiations (which are in the order) give leeway for it to be introduced.

The US government can already negotiate the price of America’s most expensive drugs due to former President Joe Biden’s Inflation Reduction Act. However, it hasn’t done much to bring prices down for everyday citizens:

• The first 10 prescription drugs the government lobbied were still, on average, more than double (and occasionally five times as much) what pharmaceutical companies had agreed to in other developed nations.

This isn’t Trump’s first try: In his first term, the President proposed a previous international reference pricing plan, which was projected to save taxpayers more than $85 billion, but was blocked by a federal judge.

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People are betting on who the next pope will be

What else does the Vatican expect us to do with our free time? After Pope Francis died in the early hours of Easter Monday, millions around the world grieved the loss of such an influential religious figure.

Some speculated at the discreet papal selection process known as a conclave (see overview), while others, however, migrated to online betting marketplaces.

Next in line

While a successor to the pope has yet to be announced, it hasn’t stopped swaths of online gamblers who feel the need to wager their money on anything obscure enough to make a potential profit.

• As of writing, more than $5.4 million has been wagered on who the next pope will be on the popular betting site Polymarket (see odds).

• Side bets range from when he’ll be elected, where he’s from, and his papal name.

Prospective pope wagers began in February when Pope Francis was hospitalized due to a lung infection (pretty macabre), spurring hundreds of thousands of dollars in bets on prediction markets.

This isn’t anything new: Believe it or not, papal betting—also known as “pope wagers”—dates back to the early 16th century. The first recorded instance was in 1503, and the practice quickly spread through Rome as rumors of potential successors began to leak.

European Space Agency launches mission to grow food in space

I’m sure a nice steak would beat powdered stew. The European Space Agency (ESA) launched a food lab into orbit as part of a mission to explore the viability of growing food in space.

Martian meals

The lab, launched aboard a SpaceX Falcon 9 rocket, carries a special bioreactor that could produce lab-grown food in the harsh environment of space or even on other planets. So, how does this thing work?

• The reactor uses precision fermentation, which is similar to beer brewing, to grow food from genetically engineered yeast.

• Researchers at Imperial College London and UK-based Frontier Space, who developed the tech, hope that it can eventually produce proteins, carbs, and fats for astronauts on long missions.

Why do this? If the bioreactor experiment works out, it could cut down on costly supply shipments from Earth (or even stop them altogether). The ESA estimates the current cost of feeding a single astronaut is around $27,000 per day.

Though it might sound a bit gimmicky, developing a way for astronauts to live (and eat) self-sufficiently in space could unlock many doors, from enabling deep space exploration to tackling food sustainability back on Earth.

FAST FACTS
Catch up on this week’s weird news

AI Assist: A new AI service will call your parents for you and give you a summary of the call, including a “visual indicator” of their mood. You’d really be living up to your “World’s Best Son” mug after this one.

Polite Program: While saying "please" and "thank you" to ChatGPT might save you when AI eventually rebels, OpenAI CEO Sam Altman says it costs “tens of millions of dollars” in computing power.

Price Preview: When you search for a place to stay on Airbnb, the total cost of your visit, including any fees, will now be displayed immediately.

Google Getter: OpenAI is considering buying the Chrome browser from Google if the tech giant is forced to sell it, a company official said earlier this week.

Tampa Turnover: Tampa's net inflow (the number of people moving in compared to those leaving) was 10,000 last year, down from 35,000 in 2023 and the single greatest dip of any major US metro region in 2024, according to Redfin. 

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