A Chinese tariff on U.S. soybeans is now a reality.
After weeks of rumours and speculation, China announced a proposed 25 percent tariff on American beans today.
The move came only hours after the U.S. announced a list of Chinese products that will soon be subject to tariffs, such as flat screen televisions, aircraft parts, clothing, batteries and toys.
The specifics of the American tariffs are part of U.S. President Donald Trump’s plan, unveiled in March, to impose tariffs on $50 billion worth of Chinese imports.
Trump has said, many times, that China breaks global trading rules, under-values its currency and dumps goods into the American market, thus killing U.S. jobs and harming the American manufacturing sector.
The American Soybean Association, which represents growers, released a press release this morning to express “its extreme frustration about the escalation of a trade war” with the largest customer of U.S. soybeans.
“It should surprise no one that China immediately retaliated against our most important exports, including soybeans. We have been warning the administration and members of Congress that this would happen since the prospect for tariffs was raised,” said ASA president John Heisdorffer.”
“This is no longer a hypothetical, and a 25 percent tariff on U.S. soybeans into China will have a devastating effect on every soybean farmer in America.”
In 2016 America exported about $14 billion worth of soybeans to China, by far the largest market in the world for soybean exporters.
Soybean futures in Chicago sank today on the news. As of mid-morning nearby soybean futures were down US29 cents and were trading around $10 per bu.
Besides soybeans, China proposed to slap import duties on Tesla electric cars, Lincoln cars and Jack Daniel’s whiskey.
China hits back at U.S. plan to slap tariffs on $50 billion in Chinese goods, imposing duties on U.S. soybeans, cars and planes pic.twitter.com/kHE878YVr1
— China Xinhua News (@XHNews) April 4, 2018
Americans for Farmers and Families, a lobby group, said U.S. farmers are paying the price of the U.S.-China trade war.
“We recognize the need to hold China accountable for its unfair trading practices, but that should not be done at the expense of America’s food and agriculture industries…. Now more than ever, the Trump administration should be focused on delivering modernized deals like the North American Free Trade Agreement that preserve and expand access to critical markets. Farmers and families are counting on them to get this right.”