China’s decision to scrap its anti-dumping and countervailing duty cases and a 179 percent tariff on U.S. sorghum has energized U.S. industry officials who hope it’s a sign that U.S.-Chinese trade relations are improving.
Tensions between the two countries are still high, but National Sorghum Producers (NSP) CEO Tim Lust told Agri-Pulse he expects Chinese importers to begin buying U.S. sorghum again soon.
“There have been a lot of challenges with the announcement of the tariff …” Lust said. “A lot of our customers in China were hurt. A lot of the grain trade was hurt. A lot of farmers were hurt with a substantial drop in prices. It’ll take a little while to work through all of that, but we will.”
It was on April 18 that China announced it was slapping anti-dumping duties of 179 percent on U.S. sorghum after a preliminary investigation. The effect was immediate, causing Chinese buyers to cancel orders and halt purchases. Twenty ships full of sorghum were on their way to China when the announcement was made. U.S. sellers, with the help of the U.S. Grains Council, were forced to find new buyers at a discount in Japan, Mexico, Spain and elsewhere.
U.S. trade officials widely interpreted China’s action as retaliation for recent U.S. tariffs on Chinese washing machines, solar cells and other goods.
"This is critical good news for U.S. sorghum producers and exporters, and U.S. agriculture as a whole,” said U.S. Grains Council President and CEO Tom Sleight. “Today’s development is also a step in the right direction for U.S.-China trade relations, and we hope it is a platform for further lessening of tensions and challenges facing U.S. grains exports to China."
Relations between the U.S. and China are still tense. New Chinese tariffs on U.S. pork, almonds, oranges, wine and other commodities remain in place in direct retaliation to U.S. tariffs on steel and aluminum. China is also threatening a 25 percent tariff on U.S. soybeans in response to a U.S. plan to hit the Asian nation with levies as punishment for intellectual property theft.
Chinese Vice Premier Liu He is in the U.S. this week to negotiate trade policies with the Trump administration. There’s still a wide gulf between the two countries, but National Sorghum Producers Chairman Don Bloss said Friday he’s hopeful China’s decision on sorghum is a good omen.
“We agree that it is in China’s public interest to terminate these cases, and we look forward to deepening our trade ties with our Chinese partners and customers,” Bloss said. “We hope the dismissal of these cases reflects a lessening of trade tensions as our leaders continue to dialogue. Agricultural production and international trade is one of the United States’ greatest success stories.”