China Trade

Steve Helber | Associated Press

Trade goods: A container ship is unloaded May 9 at the Virginia International Gateway terminal in Norfolk, Va. China has announced tariff hikes on $60 billion of U.S. goods in retaliation for President Donald Trump’s escalation of a fight over technology and other trade disputes.

By Barbara Olejnik

Poultry Times staff

bolejnik@poultrytimes.com

WASHINGTON — The trade war between the U.S. and China has heated up following retaliatory tariffs imposed by the two countries on each other's products.

The U.S., on May 10, announced it was hiking tariffs on $200 billion of Chinese goods from 10 percent to 25 percent.

China followed on May 13 with an announcement that it was imposing tariffs ranging from 5 percent to 25 percent on $60 billion worth of U.S. imports.

Both sets of tariffs are scheduled to go into effect on June 1.

The U.S. action came while the two countries were seeking to establish a trade agreement and in retaliation for China's alleged breaking of past promises related to the trade agreement.

President Trump has also said he is prepared to place a 25 percent tariff on another $325 billion of Chinese product, covering everything China ships to the U.S.

The president Tweeted on May 10 that "China will be hurt very badly if you don't make a deal because companies will be forced to leave China for other countries. Too expensive to buy in China. You had a great deal, almost completed & you backed out!"

A major sticking point in the trade talks between the two countries is the allegation by U.S. companies that China requires them to turn over trade secrets in order to have access to the Chinese market.

Chinese officials deny Beijing steals or pressures companies to hand over technology.

On March 15 the Chinese legislature endorsed a new law that aims to address complaints that China's system is rigged against foreign companies.

However, the Trump administration wants Beijing to accept an enforcement mechanism with penalties to make sure it carries out its commitments.

While China's top trade negotiator, Vice Premier Liu He was in Washington over the weekend for trade discussions, the talks ended with no word of progress.

It is possible that Trump might meet and talk with Chinese President Xi Jinping during next month's meeting of the Group of 20 major economies in Japan.

The latest round of U.S. tariffs on Chinese goods applies to about 5,700 categories of products.

The tariff increase will only apply to goods that leave China after May 10 or goods that arrive after June 1.

Seaborne cargo shipped from China generally takes around three weeks to arrive at a U.S. port, creating a delay that could provide additional negotiation time.

Chinese tariffs on U.S. goods cover items such as batteries, spinach, coffee and a broad range of agricultural products including peanuts, sugar, chicken and turkey.

U.S. agricultural commodities have expressed concern at the increased tariffs.

American Soybean Association president Davie Stephens said, "We need a positive resolution of this ongoing tariff dispute, not further escalation of tensions."

Ben Scholz, president of the National Association of Wheat Growers, said the additional tariffs "will continue to put a strain on our export markets and threaten many decades worth of market development."

"Holding China accountable for objectionable behavior is an admirable goal, but the ripple effects are causing harm to farmers and rural communities," states National Corn Growers Association president Lynn Chrisp. "Agriculture needs certainty, not more tariffs."

The three commodities represented about 171 million acres of farmland in the U.S.

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