Trump’s protectionist trade policy are causing a lot of concerns from US farmers. The steel and aluminum tariffs on Mexico have already triggered retaliation on US agriculture products. The trade war with China is even a bigger concern. Brian Kuehl, executive director of Farmers for Free Trade, said “the reason you are seeing people increase the pressure now is because the pressure is increasing on them. Now the impact is really starting to hit. It is not something you can just take lightly.”

The group issued a statement last week in response to the section 301 tariffs on China. There it noted imposing tariffs on China is “no longer a negotiating tactic” and it’s a “tax” on farmers livelihoods. It’s “downright scary”. And the group criticized that the tariffs is a “win for our competitors”, including South Maerica and Australia. The group called for elected officials to stop this trade war.

Here is the statement:

Farmers for Free Trade Executive Director, Brian Kuehl released the following statement following reports that the Administration will move forward with $50 billion in tariffs on China which are expected to result in heavy retaliatory tariffs on U.S. agricultural exports.

“For American farmers this isn’t theoretical anymore, it’s downright scary. It’s no longer a negotiating tactic, it’s a tax on their livelihoods. Within days, soybean, corn, wheat and other American farmers are likely to be hit with retaliatory tariff of up to 25% on exports that keep their operations afloat. When they do, they’re not going to remain silent.

“The imposition of these tariffs is not only a blow to our farmers, it’s a win for our competitors. When American soybeans and corn become more expensive, South America wins. When beef becomes more expensive, Australia wins. As this trade war drags on, farmers will rightly question why our competitors are winning while we’re losing.

“Farmers for Free Trade will continue to hold town hall meetings across the country this summer to ensure farmer’s voices are being heard. The message will be loud and clear: American farmers demand that elected officials support them by ending this trade war.”

The group will also launch a TV ads on Tuesday in  Pennsylvania and Michigan urging Trump to stop trade war.

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China announced retaliation tariffs on US importants, including soybean, agricultural products, automobiles. These products are valued at around USD 34B, will be subjected to 25% tariffs, starting July 6, 2018.

China would also impose 25% tariffs on other products, valued at around USD 16B, including  chemicals, medical equipment, and energy products. Effective date is to be determined.

Below is the “google-translated” statement. Original statement in simplified Chinese could be found here.

Announcement on Imposing Tariff on Certain Products Originating in the United States

On June 15, 2018, the U.S. government announced that it would impose an import tariff of 25% on China’s 50 billion U.S. dollar products, including levied tariffs on about US$34 billion of Chinese exports to the US The measures will be implemented on July 6. Additional tariff measures for the remaining US$16 billion will further seek public opinions. The United States disregards China’s resolute opposition and solemn representations and insists on taking actions that violate the rules of the World Trade Organization. It seriously violates China’s legitimate rights and interests under the rules of the World Trade Organization and threatens China’s economic interests and security.

Regarding the emergency situation caused by the United States’ violation of its international obligations to China, and in order to defend its legitimate rights and interests, China decided to rely on the laws and regulations of the Foreign Trade Law of the People’s Republic of China and other basic principles of international law on soybean, agricultural products , automobiles , and water originating in the United States. Products and other imported goods are subject to tariff levying measures at a tax rate of 25%, involving about 34 billion U.S. dollars in imports from the United States in 2017 (see Annex 1). The above measures will take effect from July 6, 2018.

At the same time, China intends to impose an import tariff of 25% on commodities imported from the United States, including chemicals, medical equipment, and energy products, involving approximately US$16 billion in US imports from the United States in 2017 (see Annex 2), final measures, and effective time. Will be announced separately .

Annex:

List of Customs Tariff Commissions of the State Council Concerning the Collection of Customs Products for the United States and Canada.pdf

The Customs Tariff Commission of the State Council issues a list of tariffs on the United States and Canada.pdf

Response from the Chinese MOFCOM below. Original in simplified Chinese. Below is “google-translated”:

China and the United States have conducted several rounds of consultations on economic and trade issues in an effort to resolve differences and achieve a win-win situation. We deeply regret that the United States has disregarded the consensus it has formed and is fickle, provoking a trade war. This move is not only damaging bilateral interests but also undermining the world trade order. China firmly opposes this.

China does not want to fight a trade war. However, in the face of short-sighted behavior that the United States has done against people’s disadvantages, the Chinese side has to give a strong blow back, resolutely safeguard national interests and the interests of the people, and resolutely defend economic globalization and the multilateral trading system. We will immediately introduce taxation measures of the same scale and the same strength. All the economic and trade achievements previously reached by the two parties will be invalid at the same time.

In today’s era, launching a trade war is not in the global interest. We call on all countries to take joint action, resolutely put an end to this outdated and regressive behavior, and firmly defend the common interests of mankind.

The US Trade Representative formally announced the section 301 tariffs on Chinese imports, targeting products related to the Made in China 2025 policy. USTR said these “strong defensive actions” are to ” protect America’s leadership in technology and innovation against the unprecedented threat posed by China’s theft of our intellectual property, the forced transfer of American technology, and its cyber attacks on our computer networks.” And it condemned that “China’s government is aggressively working to undermine America’s high-tech industries and our economic leadership through unfair trade practices and industrial policies like ‘Made in China 2025.'”

There are two set of tariffs lines. The first set contains 818 lines of the original 1,333 lines announced in April. This set covers around USD 34B of Chinese imports. 25% tariffs will be imposed starting July 6, 2018. The second set contained 284 proposed tariff lines, covering around USD 16B in Chinese goods. This set will undergo further public view before finalizing.

Altogether they’re valued around USD 50B. and focuses on products from industrial sectors that contribute to or benefit from the “Made in China 2025” industrial policy, which include industries such as aerospace, information and communications technology, robotics, industrial machinery, new materials, and automobiles. The list does not include goods commonly purchased by American consumers such as cellular telephones or televisions.

USTR Issues Tariffs on Chinese Products in Response to Unfair Trade Practices

Washington, DC – The Office of the United States Trade Representative (USTR) today released a list of products imported from China that will be subject to additional tariffs as part of the U.S. response to China’s unfair trade practices related to the forced transfer of American technology and intellectual property.

On May 29, 2018, President Trump stated that USTR shall announce by June 15 the imposition of an additional duty of 25 percent on approximately $50 billion worth of Chinese imports containing industrially significant technologies, including those related to China’s “Made in China 2025” industrial policy.  Today’s action comes after an exhaustive Section 301 investigation in which USTR found that China’s acts, policies and practices related to technology transfer, intellectual property, and innovation are unreasonable and discriminatory, and burden U.S. commerce.

“We must take strong defensive actions to protect America’s leadership in technology and innovation against the unprecedented threat posed by China’s theft of our intellectual property, the forced transfer of American technology, and its cyber attacks on our computer networks,” said Ambassador Robert Lighthizer.  “China’s government is aggressively working to undermine America’s high-tech industries and our economic leadership through unfair trade practices and industrial policies like ‘Made in China 2025.’  Technology and innovation are America’s greatest economic assets and President Trump rightfully recognizes that if we want our country to have a prosperous future, we must take a stand now to uphold fair trade and protect American competitiveness.”

The list of products issued today covers 1,102 separate U.S. tariff lines valued at approximately $50 billion in 2018 trade values.  This list was compiled based on extensive interagency analysis and a thorough examination of comments and testimony from interested parties.  It generally focuses on products from industrial sectors that contribute to or benefit from the “Made in China 2025” industrial policy, which include industries such as aerospace, information and communications technology, robotics, industrial machinery, new materials, and automobiles.  The list does not include goods commonly purchased by American consumers such as cellular telephones or televisions.

This list of products consists of two sets of U.S tariff lines.  The first set contains 818 lines of the original 1,333 lines that were included on the proposed list published on April 6.  These lines cover approximately $34 billion worth of imports from China.  USTR has determined to impose an additional duty of 25 percent on these 818 product lines after having sought and received views from the public and advice from the appropriate trade advisory committees.  Customs and Border Protection will begin to collect the additional duties on July 6, 2018.

The second set contains 284 proposed tariff lines identified by the interagency Section 301 Committee as benefiting from Chinese industrial policies, including the “Made in China 2025” industrial policy.  These 284 lines, which cover approximately $16 billion worth of imports from China, will undergo further review in a public notice and comment process, including a public hearing.  After completion of this process, USTR will issue a final determination on the products from this list that would be subject to the additional duties.

USTR recognizes that some U.S. companies may have an interest in importing items from China that are covered by the additional duties. Accordingly, USTR will soon provide an opportunity for the public to request the exclusion of particular products from the additional duties subject to this action.  USTR will issue a notice in the Federal Register with details regarding this process within the next few weeks.

Background

President Trump announced on March 22, 2018, that USTR shall publish a proposed list of products and any intended tariff increases in order to address the acts, policies, and practices of China that are unreasonable or discriminatory and that burden or restrict U.S. commerce.

These acts, policies and practices of China include those that coerce American companies into transferring their technology and intellectual property to domestic Chinese enterprises.  They bolster China’s stated intention of seizing economic dominance of certain advanced technology sectors as set forth in its industrial plans, such as “Made in China 2025.”  (See USTR Section 301 Report here.)

On April 3, USTR announced a proposed list of 1,333 products that may be subject to an additional duty of 25 percent, and sought comments from interested persons and the appropriate trade advisory committees.

Interested persons filed approximately 3,200 written submissions.  In addition, USTR and the Section 301 Committee convened a three-day public hearing from May 15-17, 2018, during which 121 witnesses provided testimony and responded to questions. The public submissions and a transcript of the hearing are available on www.regulations.gov in docket number USTR-2018-0005.

Click here to view a fact sheet on the Section 301 product list.

Click here to view a fact sheet on the Section 301 investigation.