Ag Reaction Muted After 90-Day Reduction of U.S.-China Tariffs

After a weekend of trade negotiations in Switzerland, the United States and China revealed terms of a 90-day reduction of tariffs Monday in a joint statement. The news brings down the temperature of a trade war that reached its peak when President Trump upped tariffs on one of the U.S.’s top three trade partners. 

In the release, the nations said the agreement shows they recognize “the importance of a sustainable, long-term, and mutually beneficial economic and trade relationship.”

Duties on imports from China will now drop from 145% to 30%, and China’s tariffs on U.S. imports will drop from 125% to 10% for the next 90 days. These measures go into effect on Wednesday, May 13. The news led to boosts across the board in markets. 

NBC reported that Goldman Sachs analysts warned clients that uncertainty could still reign in the coming months.

“The full set of U.S. tariffs would still be considerably higher and broader than expected by markets at the start of the year,” analysts wrote on Monday, noting that the 90-day countdown “should keep uncertainty high for both investors and businesses.”

In a press conference following the announcement, Treasury Secretary Scott Bessent told CNBC that the tariff reduction could lead to further talks between the countries.

The United States and China now have “a mechanism to avoid the upward tariff pressure,” Bessent said Monday. “I would imagine that in the next few weeks we will be meeting again to get rolling on a more fulsome agreement.”

The agriculture industry was relatively quiet on Monday in an immediate reaction. 

Farmer Groups

National Farmers Union (NFU)

The NFU advocates on behalf of more than 230,000 American farm families.

“We are encouraged to see the administration responding to the concerns of farmers and ranchers by taking steps to ease trade tensions with China,” said NFU President Rob Larew. “Farmers spent years developing China into an important market for many agricultural products; future trade agreements must build on these decades of work. While today’s news is a positive next step, farmers continue to face significant uncertainty. We are watching these negotiations closely and expect any future deal to deliver lasting, meaningful benefits for America’s family farmers and ranchers.” 

Commodities Groups

American Soybean Association (ASA)

The ASA represents U.S. soybean farmers on domestic and international policy issues. ASA has 26 affiliated state associations representing 30 soybean-producing states and nearly 500,000 soybean farmers.

“We are very pleased with these first steps toward resolution and appreciate that President Trump has heard our requests to quickly come to the negotiation table for agriculture producers and others who stand to suffer financial losses and lose hard-earned relationships,” said Caleb Ragland, American Soybean Association president and soy farmer from Magnolia, Kentucky. “Farmers want to play their part in supporting broad-based, long-term solutions to the administration’s concerns and help our fellow U.S. citizens when possible; but we cannot sustain tariffs that are exponentially higher than those of the first China trade war, which knocked out our largest export market overnight, if they linger into our fall harvest season. 

“We hope that a deal can be reached in which China commits to robust purchases of U.S. soybeans and other products very soon.”

National Pork Producers Council (NPPC)

The NPPC is a trade association representing U.S. pork producers and industry stakeholders.

“America’s pork producers are encouraged by the temporary tariff reduction agreement reached by the United States and China,” said Duane Stateler, NPPC president and a pork producer from McComb, Ohio. “We look forward to the continued collaboration and engagement between both countries to further reduce tariff and non-tariff barriers to trade. No other country holds a candle to our export opportunities in China, as many of our exported pork products, such as offals, are not widely consumed in the United States and have nowhere to go.”

Market Forecasters

Emarketer

Emarketer is a forecast, data, and insights provider across the marketing, advertising and ecommerce fields.

“The Trump administration’s retreat from its extreme 145% tariffs and its softer stance on United States-China decoupling offer short-term relief for retailers,” said analyst Zak Stambor. “But it’s clear the Overton window has shifted: a 30% tariff is still a significant hit to retailers’ margins, and with only a 90-day pause in place, the lingering uncertainty makes long-term planning nearly impossible. Still, the tentative deal provides some breathing room as retailers gear up for back-to-school and holiday shopping.”