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Trump says ‘no need to rush’ in China talks after tariffs hit

By Derek Wallbank • May 10, 2019 at 3:35 PM

President Donald Trump, the morning after levying fresh tariffs on China, says talks between the two countries “continue in a very congenial manner — there is absolutely no need to rush.”

Trump, in a string of Twitter posts said the process has begun to place additional tariffs at 25 percent on the remaining $325 billion dollars worth of Chinese goods imported by the U.S., and claimed money received from tariffs would be used to purchase agricultural products from U.S. farmers to ship to other countries for food aid. Trump also said waivers on some products would be granted “or go to new source,” though he didn’t elaborate.

“In the meantime we will continue to negotiate with China in the hopes that they do not again try to redo deal!”

China has said it will be forced to retaliate, though hasn’t yet specified how or when it will do so.

Discussions between President Xi Jinping’s top trade envoy and his U.S. counterparts in Washington made little progress on Thursday, with the mood around them downbeat, according to people familiar with the talks. The negotiations resumed later Friday morning Washington time.

As of Friday, tariffs on $200 billion in products from China — including electronics, medical devices, seafood, clothing and handbags — will go up from the current 10 percent to 25 percent. The new tariff move was expected to be met with retaliatory measures from China.

The onset of new duties ends a ceasefire agreed to by Trump and Chinese President Xi Jinping six months ago after a series of tit-for-tat tariff actions. And it increases the odds of a full-on trade war between the two largest economies that would have ripple effects around the world.

On Friday, farmers across the country expressed their concern.

Officials with the National Association of Wheat Growers (NAWG), the American Soybean Association (ASA), and the National Corn Growers Association (NCGA) said they were expecting a deal by March 1 before farmers went back into the fields but today saw an escalation of the trade war instead. The three commodities represent around 171 million of acres of farmland in the United States.

“U.S. wheat growers are facing tough times right now, and these additional tariffs will continue to put a strain on our export markets and threaten many decades worth of market development,” said NAWG President and Texas wheat farmer Ben Scholz. “Further, members from both sides of the aisle and Chambers have reservations about the Section 232 tariffs in the U.S.-Mexico-Canada Agreement. Today’s announcement adds on another political barrier, which may hinder Congressional consideration of the Agreement.”

“We have heard and believed the President when he says he supports farmers, but we’d like the President to hear us and believe what we are saying about the real-life consequences to our farms and families as this trade war drags on,” said Davie Stephens, soy grower from Clinton, Ky., and ASA president. “Adding to current problems, it took us more than 40 years to develop the China soy market. For most of us in farming, that is two thirds of our lives. If we don’t get this trade deal sorted out and the tariffs rescinded soon, those of us who worked to build this market likely won’t see it recover in our lifetime.”

“Corn farmers are watching commodity prices decline amid ongoing tariff threats, even while many can’t get to spring planting because of wet weather. Holding China accountable for objectionable behavior is an admirable goal, but the ripple effects are causing harm to farmers and rural communities. Farmers have been patient and willing to let negotiations play out, but with each passing day, patience is wearing thin. Agriculture needs certainty, not more tariffs,” said NCGA President Lynn Chrisp.

Growers have been reeling for almost a year now after the United States first imposed a 25-percent duty on $50 billion worth of Chinese goods in July 2018, and later, a 10-percent duty on an additional $200 billion worth of Chinese products, which resulted in the retaliatory tariffs on U.S. goods.

Some farmers are saying these tariffs are having a compounding impact not only on agriculture but all industries across the United States.

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©2019 Bloomberg News

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