On Friday, the White House confirmed that President Trump would move forward with putting tariffs totaling $34 billion on China. A move Brian Kuehl from Farmers For Free Trade says makes our current situation a “classic trade war.”
During AgriTalk’s Friday Free For All, Pro Farmer policy analyst Jim Wiesemeyer clarified that these tariffs don’t take effect until July 6. Hopefully U.S. and Chinese trade negotiators come to some sort of agreement before then, he told AgriTalk host Chip Flory.
This round of tariffs is to counter the intellectual property theft happening in China. While Chinese officials have said they will retaliate immediately, they have yet to release a retaliatory list, Wiesemeyer says.
Kuel was quick to add that this is just another punch in the trade war fist fight.
“I think for context it's important to understand [that] we've already had a bunch of punches thrown,” he said. “We put tariffs on Chinese steel, they put tariffs on our fruit, on our nuts, on our wine, so significant ag industries for particular regions, and for pork. Then we put steel tariffs on Mexico, Canada, EU, Japan, and India all of whom have either put tariffs back on us or talked about putting tariffs back on us. Now we're escalating with these tariffs on intellectual property against China and talking about the $100 billion. I mean this this is a classic trade war. This is how things get out of control.”
According to Wiesemeyer, each day there’s increasing pressure on both sides to come to a solution.
“There’s not just pressure on impacted producers and other businesses from these tariffs, even more pressure will come back on the two governments to try to come to an agreement, and let’s hope they do,” he said.
Kuehl warns there’s potential for long-term damage from trade wars.
“Okay, let's say we all get nice and by July 15 this thing's over. Well A, that's probably not going to happen because these things tend to take a long time to resolve. But B, while these trade disputes are going on the marketplace is not standing still. Australia's positioning to sell beef into China. France is selling wine into China. Brazil is selling soybeans into China,” he explained. “One of our concerns, and history shows this is true, [is that] you lose a market and you don't recover overnight. These things have lingering impacts on your industry.”