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US President Donald Trump said on Friday that he was ready to impose tariffs on every dollar of imports from China, which exceeded $505 billion in 2017, reported Dawn (Pakistan).
The Wall Street Journal noted that Mr Trump’s comments had an immediate impact on global markets, sending the stocks lower.
“I’m ready to go to 500,” the president told CNBC’s Joe Kernen in a “Squawk Box” interview aired on Friday.
“I’m not doing this for politics, I’m doing this to do the right thing for our country,” he said. “We have been ripped off by China for a long time.”
Mr Trump complained that the US was “being taken advantage of” on a number of fronts, including trade and monetary policy. Yet he said he has not pushed the tariffs out of any ill will toward China.
“I don’t want them to be scared. I want them to do well,” he said. “I really like President Xi a lot, but it was very unfair.”
Mr Trump also criticised previous US administrations for not standing up to China, claiming that unspecified Chinese officials told him “nobody would ever complain until you came along — me. They said, ‘Now you’re more than complaining. We don’t like what you’re doing.’”
Data released by the US Census Bureau show that in 2017, the US imported 505.5 billion worth of goods from China, while its exports to China amounted to only $129.9bn.
Determined to correct this imbalance, the Trump Administration has already slapped tariffs on $34bn of Chinese products, which China met with retaliatory duties. Earlier this month, the US also scheduled additional tariffs on $16bn of Chinese electronics and other components.
Last week, the Trump administration also identified a further $200bn in Chinese goods it may target for tariffs, for a total of $250bn.
In earlier statements, Mr Trump warned that he was willing to go beyond the $250bn amount if China retaliated. But this is the first time that he spoke of targeting every dollar of imports from China.
When asked during Friday’s interview, “Will you ever get to 500, though?” Mr Trump responded that he was. “I’m doing this to do the right thing for our country. We have been ripped off by China for a long time,” he said.
China has pledged to retaliate against US tariffs in “equal scale and equal strength.”
The CNBC report noted that while China cannot match US tariffs because of the trade imbalance, it had other options too: “China holds $1 trillion worth of US treasury bonds. If it stops buying new bonds, or sells off its holdings, it would trigger a hike in yields putting pressure on America’s debt load.”
China can also undo the impact of the US tariffs by devaluing the yuan by 8 per cent. The Chinese government could also make it harder for US companies to operate in China.
The Wall Street Journal noted that Friday morning’s CNBC interview sent European stocks lower, with the Stoxx Europe 600 falling around 0.7pc before recovering some of its losses. Shares in trade-sensitive stocks were hardest hit, with auto makers Daimler, Volkswagen and Fiat Chrysler all down more than 1pc.
Who’s winning the US-China trade war? When it comes to soybeans, the answer is Brazil. The South American nation is capitalising on the strife caused by US President Donald Trump’s trade war to profit from both China and America in soybean trade, reported South China Morning Post (Hong Kong).
China has been the biggest buyer of US soybean in recent years, but as imports have become caught up in Beijing and Washington’s tit-for-tat tariffs, Chinese purchasers are now looking to to Brazil to make up the shortfall.
As a result, US soybean prices have fallen by 20 per cent since April to their lowest price in nearly a decade, while the Brazilian crop is being sold at a premium, according to industry watchers.
At the same time, Brazil and Argentina, another major soybean grower, have snapped up some of the cheap US supplies for their domestic markets, according to Grant Kimberley from the Iowa Soybean Association.
“There have been purchases from Brazil and Argentina to back fill their own domestic industries,” he said.
It’s not just Brazil that’s buying the surplus American soybeans, however; US sellers have also reported unusually high sales in non-traditional markets across Europe, the Middle East and Southeast Asia.
“In the end, the beans are going to move someplace, it’s just question of at what price,” he said. “It’s like a big game of musical chairs, but it’s not something you would draw up in an economics class as a model of efficiency, that’s for sure.”
China, which imports 60 per cent of the soybeans traded worldwide, bought 32.9 million tonnes from the US last year, accounting for 34 per cent of total purchases.
That total is forecast to drop by 6.8 million tonnes for the 2018/19 crop year, according to the US Department of Agriculture.
In contrast, Brazil’s exports to China were on the rise, increasing to 8.2 million tonnes in June from 6.6 million tonnes at the same time last year, said Arlan Suderman, chief commodities economist for New York-based commodity trading and risk management services provider INTL FCStone.
Suderman said Brazilian soybean was about 20 per cent more expensive than the US product and Chinese processors would have to decide whether to pass the extra cost on to consumers.
“They will have to absorb the increased cost, pass them along to the livestock producers utilising the soy meal and food companies utilising the soy oil, be subsidised by the government, or some combination. In the end, the Chinese crush and livestock industries are paying a steep price,” he said.
Why China can’t count on Brazil to fill the soybean gap in its trade battle with the US
US farmers are also worried about the upcoming harvest. Chinese buyers have accounted for just 17 per cent of all advanced purchases of the autumn US soybean crop, down from an average of 60 per cent over the past decade, according to Reuters.
“With each day, we’re that much closer to the combines rolling, and the longer this goes, the more anxiety will intensify,” Iowa Soybean Association spokesman Aaron Putze said.
“Although the clock is ticking, the prevailing sense among farmers is that this is going to get worked out. But [the administration of US President Donald Trump] is a different kind of administration, that is not conventional, and so people are biding their time.”
US soybean exporters say while they did not expect a resolution in the near future, both US sellers and their Chinese buyers were eager to get back to business.
“Our Chinese partners have told us they are hopeful that this gets resolved in a reasonable period of time, and that they want to resume normal trading, but their hands are tied too,” Kimberley said.
“This is a government-to-government, and a political issue, that is out of everyone’s hands.”
show source https://www.dawn.com/news/1421487/trump-threatens-tariffs-on-all-505bn-of-chinese-imports https://www.scmp.com/news/china/diplomacy-defence/article/2156195/soybean-giant-brazil-swoops-us-crop-china-trade-war