Soybean prices in the US and Brazil, the nations that account for roughly 80 percent of global exports, have taken drastically different paths thanks to Donald Trump's trade war. The price of USA soybeans has plunged 17 percent over the past month on fears that Chinese tariffs will cut off American farmers from a market that buys about 60 percent of their soybean exports.
"We are forced to make a necessary counterattack to protect the core profits of the country and the interests of people", it said in expressing readiness to take reciprocal measures against the United States.
Following the announcement of new USA tariffs in mid-June, China's Commerce Ministry said that the government would impose an additional 25% tariff on 545 kinds of American products of the same value, including soybeans, automobiles and seafood. In mid-June, Mexico warned it could strike $4 billion worth of USA corn and soy imports if President Trump imposes new tariffs, Reuters reported.
On July 2, the U.S. Chamber of Commerce issued a study outlining the state-by-state impact of retaliatory tariffs from China and other countries. "The countdown is on as to what Trump will do next".
Beijing had said it would retaliate with punitive measures on U.S. products worth a similar amount, including soybeans, pork and cotton, but it had not officially confirmed that they had taken effect.
Apart from China, Trump has also locked into trade battles with U.S. allies Canada, Mexico, EU and Japan and as well as with Russian Federation and India. "So we have 50 plus 200 plus nearly 300", Trump told reporters aboard Air Force One.
Soybean futures, which had been plummeting over the past month as the United States inched closer to a trade war with China, posted a record move higher on Friday as the promised tariffs were finally imposed.
The Trade Partnership, a US-based economics research firm, suggests that the impact will be worse than initially expected, with around 400,000 jobs affected. USA stocks edged higher on Thursday, however, amid hopes that American trade tensions with Europe may ease after comments from German Chancellor Angela Merkel.
Besides going to the WTO, China also said it would work with other countries to promote free trade, as Trump engages in battles with historical trading partners around the world.
A spokesperson for the Alliance of Automobile Manufacturers said in an email Friday that some United States carmakers may not feel a major impact right off the bat.
Businesses will have to pay 25 percent additional tax on $US34b of certain Chinese products they import - including aircraft tyres and commercial dishwashers.
There was no sign of renewed negotiations between USA and Chinese officials before Friday, business sources in Washington and Beijing said.
Nonetheless, despite the urging of business groups and lawmakers to negotiate a truce, there was little sign Friday that the two sides would reach a compromise anytime soon.
These initial tariffs are unlikely to inflict serious harm to the world's two biggest economies.
United States relations with other major trading partners have also been fraught following the Trump administration's decision earlier this year to slap tariffs on imported steel and aluminum, including those metals from the European Union, Mexico and Canada.