Northwest Arkansas Democrat-Gazette
China suspends more U.S. tariffs
Fees on 79 types of trades waived, soybean purchases up
BEIJING — China suspended punitive tariffs on more U.S. goods including radar equipment for aviation Tuesday amid pressure from President Donald Trump to buy more imports as part of a truce in their trade war.
The Ministry of Finance said tariff increases on 79 types of goods including radar sets, disinfectant and rare earths minerals would be suspended for one year starting Tuesday.
Beijing is also stepping up purchases of soybeans from the U.S. as Brazilian sales start to wane and the Asian nation seeks to meet its pledges under the trade deal with Washington, according to people familiar with the matter.
Washington agreed in January to cancel additional tariff increases, and Beijing committed to buy more American farm exports. U.S. officials said China agreed to address complaints about its technology policies.
Trump threatened May 3 to terminate the agreement if China fails to buy more American goods.
Trump said earlier that Beijing agreed to buy $200 billion worth of American farm goods and other exports.
Trump’s threat rekindled fears in financial markets of more U.S.-Chinese conflict and potential disruption of global trade at a time when economies are reeling from the impact of the coronavirus pandemic.
The two sides have raised duties on tens of billions of dollars of each other’s imports in a dispute over China’s technology ambitions and trade surplus.
Slumping economic activity because of the pandemic has prompted suggestions that China might be unable to carry out commitments to increase imports.
Last week, U.S. and Chinese trade negotiators promised to create “favorable conditions” for carrying out the truce, China’s government announced. The two sides gave no time
line for more talks.
Tuesday’s announcement was the third Chinese tariff cut since the January agreement.
Beijing announced on Feb. 6 it would reduce duties on $75 billion of U.S. goods. It followed up by rolling back penalties on a list of goods that included medical and industrial machinery.
While the nation has picked up a wide range of commodities from sorghum to wheat to corn and pork, sales of soybeans, a big factor in the trade war, have now started to accelerate.
Chinese state-run buyers have purchased more than 20 cargoes, or more than 1 million metric tons, of U.S. soybeans in the past two weeks, said sources, who asked not to be identified because the information is private.
The beans were bought using tariff waivers previously issued, they said. Purchases of 136,000 tons reported by the U.S. government Tuesday were probably made Monday.
President Donald Trump later said he’s struggling with Beijing in the wake of the global coronavirus pandemic, which is thought to have originated in the Chinese city of Wuhan.
In another sign the phase-one trade deal could be on shaky ground, the
Global Times, a communist party publication, reported that China may weigh voiding the agreement after U.S. criticism of the country’s handling of the coronavirus outbreak triggered anger among trade insiders. A
suggestion to negotiate a new deal to tilt the balance more toward the Chinese side has also been floated, the hard-line tabloid said.
Most of the purchases in the past two weeks were for loading at ports in the Gulf of Mexico, the sources said. While some were for shipment from the current crop, others were for later in the fall when the new U.S. harvest starts. Calls to the Chinese customs department went unanswered.
Crop giant Archer-Daniels-Midland Co. said this month it was encouraged by China’s purchases so far. The Chicago-based company expects the Asian nation to buy 30 million to 35 million tons of American soybeans this year, Chief Financial Officer Ray Young said in a call with analysts on April 30.
Information for this article was contributed by staff members of The Associated Press and by staff members of Bloomberg News.