Two commodities close to the heart of United States Ambassador to China Terry Branstad, pork and ethanol, were hit with major tariffs by the Chinese government Monday. This is viewed as the first volley in a potential trade war, but the reaction was expected after U.S. tariffs on Chinese steel and aluminum went into effect March 23.
China’s Commerce and Finance Ministries announced a 25% tariff on United States pork, which is expected to ‘sting,’ according to National Pork Producers Council (NPPC) Dave Warner.
“It’s a very important market. We have a potential to send more pork there. With higher tariffs, we’re not going to be as competitive as some other countries that are going in there at lower tariffs,” Warner said.
China’s action did not come as a surprise. Beijing included politically-sensitive U.S. pork on a list of $3 billion worth of U.S. targeted goods, while verbally threatening to target some $14 billion in U.S. soybeans sold in China each year.
The next volley could be much bigger and impact U.S. soybeans and a wide array of products.