The tit-for-tat trade war between U.S. and China is escalating over the past weeks. After Beijing filed the list of 106 U.S. imports for additional tariffs on April 4, the U.S. farmers became another vulnerable party under the U.S- China trade friction other than auto and tech industry.
In addition to the 128-product retaliation list issued on March 23, China’s second round list of 106 U.S. products is likely to heighten global concerns of the trade war between the world’s biggest economies. The new list contains soybean, corn, cotton, Sorghum, beef and other lucrative agricultural exports of US, which is designed to target up to $50 billion annually.
According to Statista, China was the third largest export market for the U.S.in 2017 with the export value of 130.4 billion U.S. dollars and the top export categories to China were high-tech manufacturing and agricultural products.
Ranking of the top trading partners of the United States for trade goods in 2017, by export value (in billion U.S. dollars).
In fact, U.S. agricultural exports to China could generate almost 20 billion U.S. dollars annually for American farmers. In terms of soybean export, China buys almost 2/3 of all exported U.S. soybeans and is by far the leading destination for US. If China follows through on the plan to impose a 25% tariff on soybean and other agriculture, it would ultimately the farming industry, the growing panic of U.S farmers is reasonable.
Amid global fears the trade dispute, Trump suggested that Beijing will ease trade barriers “because it is the right thing to do” and that the economic superpowers can settle the conflict that has rattled financial markets, consumers and businesses. Once again, he wrote:” President Xi and I will always be friends, no matter what happens with our dispute on trade.” in his tweet.
President Xi and I will always be friends, no matter what happens with our dispute on trade. China will take down its Trade Barriers because it is the right thing to do. Taxes will become Reciprocal & a deal will be made on Intellectual Property. Great future for both countries!
— Donald J. Trump (@realDonaldTrump) April 8, 2018
Group against to U.S. tariffs is staged in the states of Lowa, Ohio, Indiana, where farmers are keeping watchful eye on the issue. What they need is stable income but many of them claimed these tariffs will hurt them a lot.
“Cash price for beans drop over 30 cents in one day,” said Baxter, a local farmer who ran Baxter farms for over 160 years. Zippy Duvall, a Georgia farmer and president of the American Farm Bureau Federation said:” Growing trade disputes have placed farmers and ranchers in a precarious position, we cannot afford to lose any market, much less one as important as China’s”.
Meanwhile, China’s extra 25% tariff on soybean would make Brazil even more attractive to Chinese buyers, who shipped over 50 million tons of soybeans to China last year. It also would encourage Brazilian suppliers to add more acres of soybeans, and would negatively impact the profit U.S. farmers can get for their crop.
When the next wave of lists and products proposed by U.S. or China come, there are more industries and markets will be negatively affected by the dispute. How will the trade conflict play out? Welcome to leave your opinion.