The Distilled Spirits Council, a US industry group, asked the United States and China to reach a resolution without subjecting American whiskey to more tariffs, which it said would harm Chinese consumers, its hospitality sector and USA whiskey exporters. That said, while both sides have engaged in tit-for-tat measures, both are also likely looking for a negotiated exit.
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US crude inventories fell by 4.6 million barrels last week, compared with analysts’ expectations for an increase of 246,000 barrels, EIA data showed on Wednesday. “Mr. Mnuchin has been weighing a trip to Beijing, though its timing is uncertain”.
The American Chemistry Council (ACC) – which counts Exxon, Chevron, Monsanto and others as its members – urged the United States and China to come to an understanding.
The latest 25% levy on US goods could create some opportunities for Canadian soy exporters, but will also force Canada to fend off imports at home and defend sales to 69 other markets, said Soy Canada executive director Ron Davidson. Brazilian soybean, however, would be a natural substitute of the American products, much in the same way as Brazilian meat could substitute that from the U.S.
The United States unveiled a draft list of punitive duties on Chinese goods, as Washington views China’s infringement of intellectual property rights as problematic. “It may be worse than (the U.S. Department of Agriculture) said”. The protections on the $50 billion of goods announced Wednesday, together with those on the $3 billion worth of products that China unveiled earlier this week in retaliation for USA tariffs on global steel imports, account for about a third of China’s US imports. China is the top overseas market for US soybeans. They either sell billions of dollars of goods there or make some of their products in China, or both.
Trump said last month that “trade wars are good, and easy to win”, but key fellow Republicans expressed unease over the latest developments.
China has also filed a suit through the World Trade Organization’s settlement framework over the tariffs, saying that the U.S.’ trade war is “an evident violation of rules of the World Trade Organization (WTO)”.
However, the United States is gearing up for a huge wave of PE capacity coming on in 2018 and 2019, with much of it targeted for export.
Mike Miller, a wheat farmer from Ritzville, Wash., said farmers across the country “have invested a lot of money and time over the years to develop a Chinese market that has great potential to buy even more American wheat”.
Seth Seifman of J.P. Morgan says the Chinese tariff on aircraft weighing between 15 and 45 tonnes is calibrated to send a political message without have a major impact on Boeing.
China hasn’t set a date for its new tariffs, saying that it depends on when the US imposes its tariffs. “Trade flows should adjust relatively quickly, and most chemical companies have significant local production in China”, said Jefferies analyst Laurence Alexander. “China’s response is a surprise for some people”, said Mr Julian Evans-Pritchard, senior China economist at Capital Economics, noting that neither side had yet called for enforcement of the tariffs.
“Sometimes the path to this kind of growth is a little rocky”, he said.
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The Global Times newspaper, published by the ruling party and known for its nationalistic tone, suggested that further retaliatory action might target service industries in which the United States runs a trade surplus.
