US farmers have borne the brunt of China retaliatory tariffs as U.S. Soybean Shipments Hit One-Year Low.
Despite being close to a deal (for months), Trump insists in keeping $50 billion in tariffs on Chinese products. China will do the same.
Trump had demanded that China remove all tariffs as part of a deal. However, Trump backed down as he always appears to do.
To make it appear as if China is doing something meaningful for US farmers, China to Consider U.S. Request to Shift Tariffs on Farm Goods.
China is considering a U.S. request to shift some tariffs on key agricultural goods to other products so the Trump administration can sell any eventual trade deal as a win for farmers ahead of the 2020 election, people familiar with the situation said.
The step would involve China moving retaliatory duties it imposed starting last July on $50 billion worth of U.S. goods to non-agricultural imports, said the people, who asked not to be identified because the discussions were private. The shift is because the U.S. doesn’t intend to lift its own duties on $50 billion of Chinese imports even if an agreement to resolve the trade war between the two nations is reached, one the people said.
The bartering shows that both sides are taking political considerations into account as negotiations drag on to end the trade war, which has rattled financial markets for months. An outcome that completely removes punitive tariffs looks increasingly unlikely as Trump looks to hone his campaign message and continues to threaten the European Union, India and other countries with trade actions.
Over the weekend, Treasury Secretary Steven Mnuchin said the U.S. and China were “hopefully getting very close to the final round” and discussing whether to hold more in-person trade talks. He also said the U.S. is open to facing “repercussions” if it doesn’t live up to its commitments in a potential trade deal, a sign that the two sides are edging closer to an accord.
Under the proposed agreement, China would commit by 2025 to buy more U.S. commodities, including soybeans and energy products, and allow 100 percent foreign ownership for U.S. companies operating in China as a binding pledge that can trigger retaliation from the U.S. if left unfulfilled, people familiar with the situation said earlier this month.
In the Line of Fire
Hooray! China will buy more soybeans.
As a result of this side arrangement, China will buy as many soybeans as it did before Trump started the trade war.
Since Trump will not remove all tariffs, neither will China. Instead, China will put retaliatory tariffs on Boeing aircraft and other things instead of soybeans.
Trump is sure to label this as the greatest trade deal in history.
The EU is now in the spotlight.
Mike “Mish” Shedlock
“Trump is sure to label this as the greatest trade deal in history.”
The greatest trade deal in history is Equador’s 4.2 billion in loans for Julian Assange. That one person could be worth so much.
It’s important, in order to maintain the narrative underpinning feudal, totalitarian hellholes, that all the little serfs’ eyes be focused solely on passively aggrandizing and obsessing over the actions and utterings of a highly limited number of privileged “celebrities”, which the regime gets to cast, at their discretion, as either princes or villains. Like in children’s fairytales.
Then, the serfs role, is solely relegated to cheering for one or the other of those characters. Assange vs Trump. Trump vs Pelosi. Trump vs Putin. Merkel vs May…… No longer themselves doing anything which could pose a threat to their exploiters. But rather, like little girls, pliantly and unthreateningly sitting there waiting for one of the regime’s designated “princes” to come “rescue” them.
Much easier for the regime to exploit them that way, than if they instead grew up, armed up and smashed the entire totalitarian narrative to pieces; the way Washington and Co. did in 18th century America, and the Somalis did in the ’90s.
It never seems to end with Trump and has ‘trade wars’. Sigh
I am surprised to see none of the Trump cult members post the usual 4D chess comments.
As the Chinese said recently of Pompeo, American officials seem increasingly like they have lost their minds. With all their sanctions, weaponizing the reserve status of the dollar system, asinine trade wars, insane foreign policy, withdrawal from multilateral institutions, transparently infantile musings about regime change, extra-territorial jurisdiction of American laws, etc etc, they have lost all claim to being capable of being treated as a serious partner in anything. What do you think the rest of the world thinks when they see the spectacle of China being begged to shift all those winning tariffs from beans to bolts?
Self-proclaimed rulers of the world. Problem is everyone else isn’t going along with it.
Surely everyone know’s that Boeing is the largest military contractor, and any shift by China to impose tariffs on Boeing (and not on soybeans) will just be made up by even more military spending awarded to Boeing. So farmers win, Boeing wins but the US overall loses with even larger deficits and more debt. Wonder if China will bite?