China will suspend for one year the additional 24% tariffs on American goods, introduced in April, while maintaining the 10% tariffs, also introduced in response to tariffs imposed by US President Donald Trump on the occasion of "Liberation Day", the country's cabinet confirmed on Wednesday, writes UNN with reference to Reuters.
Details
The Customs Tariff Commission of the State Council of the People's Republic of China also announced the cancellation of tariffs of up to 15% that it had imposed on some US agricultural products from November 10, citing a March press release that detailed the products that the world's largest buyer of agricultural products would begin to tax.
However, after the tariff reduction, Chinese soybean buyers will still be forced to pay 13%, including the existing 3% base tariff. Traders claim that this makes supplies from the US too expensive for commercial buyers compared to Brazilian counterparts.
Before Trump took office in 2017 and the first US-China trade war began, soybeans were by far the main item of American exports to China: in 2016, the world's largest buyer of agricultural products purchased $13.8 billion worth of this product.
However, this year China has significantly refrained from purchasing American products, costing American farmers billions of dollars in lost exports. According to customs data, in 2024, China purchased about 20% of soybeans from the US, down from 41% in 2016.
Investors on both sides of the Pacific breathed a sigh of relief last week when Trump met with Chinese leader Xi Jinping in South Korea. This allayed fears that the world's two largest economies might abandon talks aimed at resolving a tariff war that has disrupted global supply chains.
Although Trump and the White House were quick to publish their position following the meeting, the Chinese side did not immediately provide a detailed report on the agreements reached.
Chinese state-owned company COFCO purchased three batches of soybeans from the US the day before the summit. Analysts consider this move a gesture of goodwill, indicating Beijing's desire to avoid an escalating and destabilizing trade tension.
Some market participants expressed doubts that soybean trade would return to normal anytime soon.
"We do not expect demand from China for the American market to return with this change," said one trader from an international trading company. "Brazil is cheaper than the US, and even buyers outside China are buying Brazilian lots."