China will again increase tariffs on U.S. agricultural products as part of an announcement Friday by China’s government to raise tariffs on $75 billion in U.S. products.
Soybeans are again caught in the middle of the trade battle between the two countries, and beans will face a 5% higher tariff starting Sept. 1, Reuters and Bloomberg first reported Friday. That will put soybean tariffs at 30%. Pork and beef also will face 10% higher tariffs on Sept. 1.
If the new tariffs go into effect, U.S. pork would face a 60% retaliatory tariff along with a 12% standard duty from China.
The tariff hike is a blow for U.S. pork producers, which had seen rising sales to China. The pork industry also has been anticipating even more demand from China because of African swine fever devastating China’s hog herd.
The National Pork Producers Council stated Friday, “Any escalation in the trade dispute with China is a major concern to U.S. pork producers. China, the largest pork-consuming nation in the world, is seeking reliable sources of pork as it deals with African swine fever. There is no more reliable source than the United States. Unfortunately, due to the current trade dispute, we are not able to fully participate in this opportunity.”
Other Grains: Deeper Hole
Corn, sorghum and wheat also will be hit with 10% higher tariffs, but those will not begin until Dec. 15. Tariffs on those crops right now are 25%, and the U.S. has effectively been shut out of the market.
Chinese officials announced the tariffs in a statement, pushing back on the Trump administration’s 10% tariff increase that will come in two rounds on $300 billion in Chinese goods starting Sept. 1 and Dec. 15.
China also will hit the U.S. auto industry, with 25% tariffs on vehicles and a 5% tariffs on parts starting Dec. 15. China had put a hold on these auto tariffs in April.
China’s government stated, “China’s adoption of tariff-adding measures is a forced move to deal with U.S. unilateralism and trade protectionism. The Chinese side once again reiterated that for China and the United States, cooperation is the only correct choice, and a win-win situation can lead to a better future.”
The tariffs hit U.S. agriculture as farmer frustrations have risen over trade, the Trump administration’s handling of refinery waivers for biofuels, and a challenging crop year. Future prices for the November soybean and December corn contracts peaked in mid to late June and have steadily declined since then.
With concerns of a possible U.S. recession, Federal Reserve Chairman Jerome Powell did not announce any specific possible steps Friday in a speech to other economists in Wyoming. The Federal Reserve lowered interest rates in July for the first time since 2008 over concerns that trade disputes could weaken the global economy.
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