China tariffs hit Trump heartland where it hurts – in American agriculture and energy
Coal, crude and dairy products among the US commodities affected by retaliatory Chinese levies
China’s response to US tariffs aims to hit the Trump administration right in its natural resources.
The world’s largest commodities consumer said on Friday that it would levy a first round of tariffs on US$34 billion worth of US agriculture products, as well as cars, starting on July 6. Another US$16 billion in goods, including coal and oil, will be subject to tariffs later. The escalating dispute sent the prices of everything from soybeans to copper lower and hit the shares of US coal producers while boosting the prospects for alternative suppliers like Brazil.
By focusing on agriculture and energy, the tariffs target rural communities in states that voted for Donald Trump in 2016. Beijing’s announcement came less than 12 hours after the US released its list of US$50 billion worth of Chinese products subject to tariffs. As recently as May, Beijing said it would seek to buy more US agricultural and energy products as part of a tentative trade truce between the two countries.
AGRICULTURE
Farm commodities have been a key battleground in the trade war between the world’s two biggest economies. In April, China started levying additional taxes on American fruit, nuts, pork and wine in response to President Trump’s tariffs on steel and aluminium. Products affected include soybean, corn, wheat, rice, sorghum, beef, pork, poultry, fish, dairy products, nuts and vegetables.
