China's ag response to U.S. tariffs was muted
The U.S. imposed a 10% tariff across all imports from China on Tuesday. In retaliation, Beijing announced retaliatory tariffs that will hit the ag machinery industry, but spare U.S. commodities.
As you can see on this chart designed by our trade editor, Oliver Ward, sugarcane harvesters will be impacted most. About 37% of those produced in the U.S. went to China as a final destination in 2023.
However, the data may be misleading. China has a specific HS code for sugarcane harvesters that the country is raising tariffs on. But, the U.S. doesn't have an equivalent HS code to specifically track the export data for sugarcane harvesters. Overall, China is a large producer of agricultural machinery which serves its own market.
In the agriculture space, China’s response to the tariffs is more muted than industry originally braced for.
China is a major market for U.S. soybean exports, which make up more than half of the $29 billion in U.S. ag exports to the country. Commodity exporters had been concerned that return tit-for-tat tariff escalations could mean a return to rising Chinese tariffs on U.S. commodities, and reduced U.S. sales to the country.
Beyond China, President Donald Trump had threatened a 25% tariff on goods entering the U.S. from Mexico and Canada. However, he rescinded the proposals just a couple of days later after speaking with leaders from both countries to secure their commitments to bolster border security.
To learn more about "Map it Out" and "Ag By the Numbers," check out our Newsmakers show.
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