Arthur J. Villasanta – Fourth Estate Contributor
Washington, DC, United States (4E) – China’s new tariffs on imported U.S. products are hurting more and more American exporters even as the Trump administration continues to delay implementing the range of punishing tariffs on Chinese imports worth $50 billion.
This, despite White House advisers like National Economic Council Director Larry Kudlow saying the administration isn’t engaged a trade war with China or anyone else. “This is just a proposed idea,” said Kudlow in early April about potential tariffs on $50 billion worth of Chinese steel, heavy machinery and 1,300 other products. “Nothing’s happened. Nothing’s been executed.” Tell that to these American exporters turned trade war casualties:
* American soybean producers are feeling the pain from massively reduced Chinese purchases. “Whatever they’re buying is non-U.S.,” said Soren Schroder, CEO of Bunge Ltd., an American agribusiness and food company with 32,000 employees worldwide. “They’re buying beans in Canada, in Brazil, mostly Brazil, but very deliberately not buying anything from the U.S.”
USDA data show that sales of soybeans to China have fallen from 255,000 metric tons in the first week of April, when the trade dispute began, to only 7,900 metric tons in the week that ended April 26. Cancellations have also jumped, to more than 140,000 metric tons in the week ending April 26. There were no canceled sales at all during the same week in 2017.
* Pork exporters say the Chinese cut pork orders starting in early April. After China imposed retaliatory tariffs on April 2, the U.S. Department of Agriculture (USDA) reported the biggest weekly drop in net pork sales to China since October 2016.
* Pecans growers from California to the Carolinas who sell about a third of their crop to China are hurting under the 15 percent tariff slapped on the product after Trump proposed steel and aluminum tariffs in late March.
* Major users of steel in the equipment industry said costs as a whole rose 15 percent in the quarter ended in March. “We expect steel and other commodity costs to be a headwind all year,” said Caterpillar CFO Brad Halverson. Boeing and Ford, which are heavy users of metals, are among companies closely monitoring prices.
A U.S. delegation including Treasury Secretary Steven Mnuchin emerged from talks in Beijing last week without an agreement as the Trump administration moves closer to imposing the first round of tariffs on at least $50 billion of imports from China.
“After two days of ‘candid’ trade talks, the U.S. and China are said to have ‘fully exchanged views’ and agreed to talk more,” said UBS Group, the Swiss financial services firm. “There is no grand trade agreement. On the positive side, both sides seem to want to continue to negotiate to avoid an immediate outbreak of a serious trade war.” They also said, “we do not expect all core differences in the US-China trade relationship to be resolved.”
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