New port fees on Chinese-owned ships kick in this week even as President Donald Trump steps up a trade war with China that has reverberated through the farm economy.
Some ocean carriers have been reassuring customers they won’t be hit with surcharges because of the port fees, but shipping experts and ag industry representatives have been skeptical.
Meanwhile this week, there is no sign of an end to the ongoing government shutdown. Amid the stalemate, the Trump administration on Friday launched targeted layoffs that White House Budget Director Russ Vought had been threatening.
While USDA appeared to have been spared in Friday's round, the Centers for Disease Control and Prevention was at least initially hit hard by the reductions in force, including employees who track disease outbreaks, according to STAT. But according to subsequent news reports, many of the firings were rescinded over the weekend.
The administration had earlier scaled back a CDC program that tracks foodborne disease outbreaks.
Repeated Senate votes on a stopgap spending bill failed last week, and Democrats appeared even more dug in after Vought launched his layoffs Friday, aimed at what Trump called “Democrat programs.”
“By impounding billions of dollars in appropriated funding and aggressively pursuing the illegal use of pocket rescissions, Vought has done everything in his power to gut the federal government piece by piece,” said a statement released by Senate Minority Leader Charles Schumer, D-N.Y., and ranking members on key Senate committees calling on Vought to resign..
“He is bent on punishing federal workers who protect our national security and deliver vital services to every American by pushing for agencies to fire thousands of nonpartisan public servants during the Republican shutdown.”
The administration has taken some pressure off Congress to end the shutdown by using USDA's Section 32 spending authority to keep the Women, Infants and Children nutrition assistance program funded, and by ensuring that members of the military won't miss paychecks.
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The House remains out of session this week. The Senate returns Tuesday but has a light committee schedule.
Tariff tit-for-tat déjà vu
In echoes of Trump’s “Liberation Day”” tariff rollout this spring, Trump announced a new 100% tariff on Chinese imports on Friday after Beijing took steps to tighten exports of rare earth materials used in the production of various high-tech products.
Beijing responded with a flurry of measures, including by slapping new charges on American ships docking at Chinese ports, mirroring a U.S. measure set to go into effect this week. But, while a spokesperson on Sunday vowed that China would retaliate with “corresponding measures,” Chinese officials have not announced any new tariffs so far.
Trump, however, sought to reassure concerned Americans in a Sunday afternoon post to Truth Social.
"Don’t worry about China, it will all be fine!" Trump stressed. "Highly respected President Xi just had a bad moment. He doesn’t want Depression for his country, and neither do I. The U.S.A. wants to help China, not hurt it!!!"
The U.S. agriculture sector is already reeling from the U.S.-China trade tensions ignited earlier in the year. China has not placed any orders for U.S. soybeans since May, and beef, pork and cotton orders are also lagging recent years.
A meeting between Trump and Chinese President Xi Jinping at the end of the month now looks doubtful, but a lot can happen in the interim.
“The next 2-1/2 weeks will undoubtedly be full of twists and turns,” Wendy Cutler, a former U.S. trade negotiator, said in a LinkedIn post Friday.
For any improvement in bilateral relations ahead of a possible meeting, officials “will need to focus on de-escalation steps on tariffs and export controls rather than on matters like excess capacity, tech boundaries and agriculture market access,” she added in a follow-up post Saturday.
Peter Harrell, a former White House senior director for international economics, is also watching for follow-up U.S. actions.
Many "non-tariff measures will be on the table in the coming weeks—and they may prove at least as important as the tariffs,” he said on X.
Trump may not face the same pressures he did earlier in the year to back off from the triple-digit tariffs. Harrell said markets “could probably stomach higher China tariffs today than in April, given the greater certainty regarding the US tariff rates on other countries.”
Other new tariffs, fees kick in
A slate of other trade measures are also set to kick in this week, including the port fees. And from Tuesday, all softwood lumber will face a 10% tariff.
Ag exporters have been anxious that the new port fees could lead to higher shipping costs and reduced supply chain efficiency, but China’s retaliation adds another layer of complexity.
“Shipping is a global industry, serving the international supply chains that farmers and businesses large and small depend on,” World Shipping Council President Joe Kramek told Agri-Pulse. “The ship fees announced by China, like those put in place by the USA, add further complexity and cost to the global network that keeps goods moving and economies connected and risk harming their exporters, producers, and consumers at a time when global trade is already under pressure.”
Beijing said Friday that any U.S.-owned ship, or with 25% or more of their equity owned by a U.S. individual, organization or company will face a $56 per net ton surcharge from Tuesday, which will rise in the coming years.
On Friday, USTR adjusted the port fee rates for vehicle carriers, among some other small adjustments. Accordingly, USTR is collecting another round of public comments on the port fees until Nov. 12.
A trade lawyer pointed out to Agri-Pulse on Friday that the lumber tariffs slated for Tuesday demonstrate the administration can be receptive to industry concerns following public consultations.
“They put in place 10% tariffs, which is still significant in that industry, but not as bad as originally was expected,” the lawyer said. “You need to get a seat at the table and kind of convey your concerns, because they're taking a harder line, but they are willing to listen, given how many tools are out there.”
Here is a list of agriculture or rural-related events scheduled for this week in Washington and elsewhere (all times EDT):
Monday, Oct. 13
Federal holiday
Tuesday, Oct. 14
Annual SAF North America Congress, through Thursday, Houston.
9.30 am – The International Food Policy seminar, “The EU Deforestation Regulation: Policy Implications and Research Frontiers.”
Wednesday, Oct. 15
9.00 a.m. – The Peterson Institute virtual event, “A new trading landscape: How is the world adjusting?”
Thursday, Oct. 16
10.00 a.m. – The International Food Policy Institute webinar, “School meal programs and regenerative agriculture: Generating evidence on sustainability tradeoffs.”
10.00 a.m. – The Office of the U.S. Trade Representative public hearing on Russia’s implementation of its World Trade Organization commitments.
Friday, Oct. 17
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