- US soybean stockpiles have recently hit record highs as exports to China have plunged to 16-year lows.
Han Jun, the Chinese vice-minister of agriculture and rural affairs, says American farmers risk losing the entire Chinese market in the deepening trade war, reported South China Morning Post.
The US began collecting 25% tariffs on $200 billion of Chinese goods arriving at all ports on Saturday morning in an intensification of the trade war. Earlier that morning, China also began collecting 25% tariff on $60 billion of American goods.
Jun said the retaliatory tariffs covered all American agricultural products, a warning that American farmers could lose significant market share in 2H19 and beyond.
“If the US doesn’t lift all additional tariffs [levied on Chinese products], bilateral agricultural product trade between China and the US, including soybean trade, will never go back to normal,” Jun told Xinhua news agency. “If the US loses China’s market, it will be very difficult for the US to regain it.”
Jun spoke about the developing farm crisis in the Midwestern US but played down the impact of the trade war on the Chinese economy.
The agriculture official said President Trump’s farm bailout(s) wouldn’t be enough to cover the losses if American farmers were entirely shutout of the Chinese market. China can withstand the trade war, he added, indicating the government will incentivize domestic farmers to plant more of the crop and could also resort to other countries, like Argentina and Brazil.
US soybean stockpiles have recently hit record highs as exports to China have plunged to 16-year lows. China cut imports of US soybeans last year by 50% while increasing imports of the crop from Brazil by 30%.
Jun’s interview with Xinhua came as Beijing Sunday published a white paper criticizing Washington for the breakdown in trade talks, but said it remained open to discussions in the future.
American farmers spent nearly four decades developing trading routes into China, while it only took President Trump less than one year to destroy them through a deepening trade war.
A rising China must be stopped, that is the thought process of President Trump, who is falling into Thucydides’s Trap. Compromising with China isn’t an option with this administration; they’ve waged an economic war on Beijing to stop its ascension in becoming the world’s next superpower. As a consequence, the first victim of the trade war is the American farmer.