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Trump's plan to keep tariffs unacceptable to soybean growersTrump's plan to keep tariffs unacceptable to soybean growers

American Soybean Association says any deal between U.S. and China must remove 25% tariff on U.S. soybeans.

March 27, 2019

3 Min Read
U.S. President Donald Trump talks with journalists before departing the White House March 20, 2019, in Washington, DC. Trump
President Donald Trump talks with journalists before departing the White House March 20, 2019.Chip Somodevilla/Staff/GettyImagesNews

President Trump’s comments that he plans to keep tariffs on Chinese products until he’s sure Beijing is complying with a trade deal isn’t pleasing to the American Soybean Association.

“We’re not talking about removing them, we’re talking about leaving them for a substantial period of time, because we have to make sure that if we do the deal with China that China lives by the deal,” Trump told reporters March 20, Bloomberg reported. “They’ve had a lot of problems living by certain deals.”

Related: Trump won’t settle for less than an ‘excellent deal’ with China

The American Soybean Association has always considered the lifting of the Section 301 tariffs by the U.S. in exchange for China removing its retaliatory 25% tariff on U.S. soybean imports as essential to any initial agreement between the two countries.

“The president’s statement that the tariffs should remain in place to ensure China’s compliance with the terms of a deal, rather than being rescinded as a part of that deal, is confounding,” said Davie Stephens, ASA president and Clinton, Ky., soybean grower. “If reciprocal tariffs have generated current pressure to reach an agreement, why wouldn’t removing the tariffs and relieving that pressure be a necessary part of any initial deal? How can the U.S. and China reach any deal without doing so?

 “We do understand the president’s concern regarding enforcement of other provisions of a deal, given China’s past record of walking back its commitments,” Stephens said. “And we would understand why the president would want to include a “snap back” mechanism to re-impose tariffs in the event other parts of any agreement were not honored, but we are tired of being collateral damage in this ongoing trade war and suffering because of these tariffs.”

ASA has gone on record in prior statements that it is has not been enough for China to make one-off “good will” purchases of U.S. soy over the last three months. Any longer-term plan to “manage” soybean trade under which China would guarantee to buy specified amounts of soybeans over an extended period of months or years—but still keep its 25% tariff in place—is not an acceptable alternative to full market access.

Related: Retaining some tariffs would keep a cloud over U.S.-China trade relations. – Investors.com

Soybean farmers continue to suffer from restricted access to China, by far the industry’s most important foreign customer. With depressed prices and unsold stocks forecast to double before the 2019 harvest begins in September, producers need China reopened to U.S. soybean exports within weeks, not months or even longer.

Any agreement reached between the U.S. and China that does not include removal of China’s 25% tariff on U.S. soybeans would not be acceptable to American soybean farmers. Bypassing elimination of China’s soybean tariff should not be on the table.

Source: American Soybean Association, which is solely responsible for the information provided and is wholly owned by the source. Informa Business Media and all its subsidiaries are not responsible for any of the content contained in this information asset

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