China Announces 34% Retaliatory Tariffs on U.S. Goods

CNBC’s Ruxandra Iordache reported that “China’s finance ministry on Friday said it will impose a 34% tariff on all goods imported from the U.S. starting on April 10, following duties imposed by U.S. President Donald Trump’s administration earlier this week, according to state news outlet Xinhua.”

“‘China urges the United States to immediately cancel its unilateral tariff measures and resolve trade differences through consultation in an equal, respectful and mutually beneficial manner,’ Xinhua cited the finance ministry as saying in a Google-translated report,” Iordache reported.

“The ministry further criticized Washington’s decision to impose 34% of additional reciprocal levies on China — bringing total U.S. tariffs against the country to 54% — as ‘inconsistent with international trade rules’ and ‘seriously’ undermining Chinese interests, as well as endangering ‘global economic development and the stability of the production and supply chain,’” Iordache reported.

Bloomberg’s Josh Xiao and James Mayger reported that “tensions between Washington and Beijing have worsened since Trump returned to the White House in January. Notably, the US president has yet to speak with his Chinese counterpart more than two months after his inauguration. They are also locked in a stalemate over China’s alleged role in the flow of fentanyl into America, which Trump cited as a reason for the previous two rounds of tariffs.”

“Before Wednesday’s announcement, the tariff imbalance between the US and China was stark: American duties on Chinese goods towered over the tariffs China charges the US. China’s average tariff on US goods stood at 17.8%, less than the 32.8% the US charged on Chinese goods, according to a Bloomberg Economics analysis,” Xiao and Mayger reported. “Last year, China imported almost $164 billion of goods from the US, the lowest amount in four years.”

Ag Exports to China at Risk

The biggest concern for U.S. agricultural imports affected by these retaliatory measures may be soybeans, as Reuters’ Mei Mei Chu reported at the beginning of March that “about half of U.S. soybeans, the country’s largest agricultural export to China, were shipped to the Asian nation in 2024, totalling $12.8 billion in trade, according to U.S. data. However, China has increasingly relied on cheaper and abundant Brazilian soybeans to reduce its dependence on U.S. supplies. This has resulted in the U.S. market share in China dropping to 21% in 2024 from 40% in 2016, according to Chinese customs data.”

Overall, Chu reported, “China imported $29.25 billion worth of U.S. agricultural products in 2024, a 14% decline from the previous year, extending a 20% drop in 2023. U.S. agricultural exports to China have declined since 2018 after Beijing slapped tariffs of up to 25% on soybeans, beef, pork, wheat, corn and sorghum in retaliation for duties on Chinese goods imposed by Trump.”

Stocks Fall Again After Retaliation Announcement

Reuters reported that “global stocks tumbled for a second day on Friday, and banking stocks cratered as investors fretted about growth and priced in far more central bank rate cuts. Benchmark 10-year U.S. Treasury yields slid below 4%.”

Reuters reported that Samy Chaar, Chief Economist at Lombard Odier in Geneva said that “it’s still early to make a final assessment. There are two paths from here: There is the one where (Trump) shows openness to deals and even if we have a harsh start, with reciprocal tariffs and these responses by China, they show willingness to talk and bring tariffs lower in the months to come.”

“‘The other path is he has no appetite to strike deals, wishes to maintain the tariffs for an extended period of time and that breaks the machine,’” Chaar said, according to Reuters’ reporting. “‘I don’t think this (Friday’s Chinese retaliation) is a signal for one or the other. Everyone will flex their muscles, but it doesn’t invalidate the idea that they make a deal at some point. But beside that, we need to have signs that at some point Trump is making comments that he is expecting to strike a deal.’”

China Announces 34% Retaliatory Tariffs on U.S. Goods was originally published by Farmdoc.