China Readying Tariff Countermeasures on U.S. Agriculture

By Ryan Hanrahan

Reuters’ Joe Cash, Mei Mei Chu and Xiuhao Chen reported that “China has American agricultural exports in its cross hairs as it prepares countermeasures against fresh U.S. import tariffs, China’s state-backed Global Times reported, raising the stakes in an escalating trade war between the world’s top two economies.”

“U.S. President Donald Trump last week threatened China with the extra 10% duty set to take effect on Tuesday, resulting in a cumulative 20% tariff, and accused Beijing of not doing enough to halt the flow of fentanyl into America, which China said was tantamount to ‘blackmail,’” Cash, Chu, and Chen reported. “‘China is studying and formulating relevant countermeasures in response to the U.S. threat of imposing an additional 10% tariff on Chinese products under the pretext of fentanyl,’ Global Times reported on Monday, citing an anonymous source.”

“‘The countermeasures will likely include both tariffs and a series of non-tariff measures, and U.S. agricultural and food products will most likely be listed,’ the report added,” according to Cash, Chu, and Chen’s reporting.

“China is the biggest market for U.S. agricultural products, and the sector has long been vulnerable to being used as a punching bag in times of trade tensions,” Cash, Chu and Chen reported. “‘Despite a decline in imports since 2018, any tariffs on key U.S. agricultural products like soybeans, meat, and grains could have a significant impact on U.S.-China trade as well as U.S. exporters and farmers,’ said Genevieve Donnellon-May, a researcher at the Oxford Global Society.”

“The world’s top agricultural importer and second-largest economy brought in $29.25 billion worth of U.S agriculture products in 2024, a 14% drop from a year earlier, extending a 20% decline seen in 2023,” Cash, Chu, and Chen reported. “…Trump’s announcement left Beijing with less than a week to come up with countermeasures or strike a deal. The proposed extra levies also coincide with the start to China’s annual meeting of parliament, a political set piece event at which Beijing is expected to roll out its 2025 economic priorities.”

Tariffs on China, as Well as Canada and Mexico, Still Planned for Tuesday

Reuters’ reported Monday morning that “U.S. Commerce Secretary Howard Lutnick said on Sunday that tariffs on Canada and Mexico will go into effect on Tuesday, but that President Donald Trump will determine whether to stick with the planned 25% level.”

“‘That is a fluid situation,’ Lutnick told the Fox News program ‘Sunday Morning Futures,’” according to Reuters’ reporting. “‘There are going to be tariffs on Tuesday on Mexico and Canada. Exactly what they are, we’re going to leave that for the president and his team to negotiate.’ Lutnick’s comments were the first indication from Trump’s administration that it may not impose the full threatened 25% tariffs on all goods from Mexico and non-energy imports from Canada.”

“Lutnick said Trump is expected to raise tariffs on China on Tuesday unless the country ends fentanyl trafficking into the U.S,” Reuters reported.

Mexico May Match U.S. Tariffs on China

Reuters’ Jasper Ward reported that “U.S. Treasury Secretary Scott Bessent said on Friday that Mexico has proposed matching U.S. tariffs on China in a move that he described as ‘very interesting’ and one that Canada should match.”

“Top Mexican officials have met with members of Trump’s cabinet this (past) week for trade talks ahead of a March 4 deadline, when U.S. President Donald Trump’s proposed tariffs on Mexican and Canadian imports are set to get into effect alongside an additional 10% duty on Chinese imports,” Ward reported. “‘I think it would be a nice gesture if the Canadians did it also so in a way we could have fortress North America from the flood of Chinese imports that’s coming out of the most unbalanced economy in the history of modern times,’ Bessent said in an interview with Bloomberg TV.”

“Mexican President Claudia Sheinbaum’s administration has said for months that it is carefully considering Washington and Ottawa’s policies towards China, saying even before Trump’s reelection that it sought to be ‘more aligned’ in addressing potential unfair Chinese trade practices,” Ward reported. “On Thursday, Mexican Deputy Economy Minister Vidal Llerenas said that Mexico could adopt further trade measures beyond tariffs it has slapped on cheap goods mostly from China, including counterfeit products, which had entered under previous low-cost exemptions known as ‘de minimis.’”

China Readying Tariff Countermeasures on U.S. Agriculture was originally published Farmdoc.