Trump's Trade War Officially Begins - Hit & Run

39;Promises made promises kept': Mr Trump has vowed to clamp down on 'unfair' trade deals

39;Promises made promises kept': Mr Trump has vowed to clamp down on 'unfair' trade deals

The trade war that President Donald Trump has been threatening has finally started, with USA tariffs of 25% on $34 billion worth of imports from China and retaliatory tariffs in China on imports worth the same amount from the U.S. having kicked in on Friday. Reciprocal levies had reportedly been prepared, which were set to take effect on the same day.

Many products have suddenly become more expensive.

"For soybean producers like me, this is a direct financial hit", said Brent Bible, a soy and corn producer in Romney, Indiana. If demand drops, jobs will be in jeopardy.

U.S. relations with other major trading partners have also been fraught following the Trump administration's decision earlier this year to slap tariffs on imported steel and aluminum, including those metals from the European Union, Mexico and Canada.

Trump's comments appeared to increase the stakes for potential retaliation by China.

China's Premier Li Keqiang said on a visit to Sofia that "A trade war benefits no-one because it hurts free trade and the multilateral process".

And of course previous year, at the Global Economic Forum in Davos, Switzerland, Chinese President Xi Jinping offered up a rousing defense of globalization - and a (rather presumptuous) suggestion that China, rather than the United States, is the new champion of free trade. "The math is simple".

The new Chinese tariff affects 545 U.S. exports including pork, bourbon, cotton, tobacco, propane, and soybeans (one United States soybean ship on a month-long journey across the Pacific raced to make it to China before the 5pm deadline... but missed it by 30 minutes).

"John Heisdorffer, an Iowa soybean farmer and president of the ASA, warned of the impact of the tariffs on farmers". "We gave so much of this (soybean) products now that the last thing we need is to limit sales. They're not going to step away from that strategy".

Christine LoCascio, an executive at the Distilled Spirits Council, said she fears China's tariffs on US whiskey will "put the brakes on an American success story" of rising exports of USA spirits. The price of soybeans has plunged 13 percent over the past month on fears that Chinese tariffs will cut off American farmers from China, which buys about 60 percent of their soybean exports. "So we have 50 plus 200 plus nearly 300", Trump told reporters aboard Air Force One.

Those retaliatory tariffs are slated to take effect Friday, after Trump's tariffs go into effect.

"You have to put all of this into context", Castaneda said in an email.

China lowered commitments to buy 366,000 metric tons of US soybeans in the season that ends August 31 and cut purchases by 66,000 tons in the following year.

If the war were to end today, the impact on economic activity in the USA, or China, or the European Union would be minimal. "All that is gone now".

China could either tie up these firms in red tape or encourage an effective boycott by Chinese consumers, experts said.

"This could not be happening at a worse time for US farmers and ranchers", Michele Aavang, an IL soy farmer and Farm Bureau member, told NBC News in an email.

"This will impact growers coast to coast", Grondine said. The dollar and Treasuries edged lower as traders looked ahead to the release of United States jobs data. China has also brought a suit against the US over the imposed tariffs in the World Trade Organisation on Friday.

USA trade data released Friday showed exports hit a record, as importers bumped up purchases, particularly of tariff-targeted United States soy beans, to build up supplies before the new duties hit. Daimler said those costs won't be completely passed on to customers.

United States companies that do a lot of business there have seen steep drops in their stock prices over the past few weeks.

They said they would, and they did.

China's soymeal futures fell more than 2 percent on Friday afternoon before recovering most of those losses, amid initial market confusion over whether Beijing had actually implemented the tariffs, which it later confirmed it had. And this year, we have had a lot of great opportunities to hedge and sell soybeans at a good price.

US Customs and border protection officials were due to collect 25% duties on a range of products including motor vehicles, computer disk drives, parts of pumps, valves and printers and many other industrial components.

Trump alleges that China uses foreign ownership restrictions, administrative review, and licensing processes to force or pressure technology transfers from American companies.

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