Grassley defends hiked China tariffs, but markets, soy growers upset
Senate Finance Committee Chairman Chuck Grassley, R-Iowa, defended President Donald Trump’s plans to increase tariffs on Chinese goods, but the action led stock markets to plunge and the American Soybean Association to criticize the move.
Grassley told reporters that he has “some sympathy for Trump’s lack of patience with the Chinese.”
“I applaud President Trump to be the first president to call out China on bad behavior and to bring them to the negotiating table,” Grassley said. “When the dust settles, we have to show that this was worthwhile negotiations, not like 2011,” when the Chinese did not live up to their promises, he said.
Grassley said the fact that the Chinese are still sending a delegation to Washington this week gives him optimism.
But investors were not nearly as optimistic. The Dow Jones Industrial Average fell more than 473 points to 25,965, and the S&P 500 was off 48 points at 2,884, CNBC reported, and analysts said the sell-off would continue if U.S. and Chinese negotiators do not reach a deal by Friday.
American Soybean Association President Davie Stephens, a grower from Clinton, Ky., said, “This is a predicament for soy growers.”
“We understand that Mr. Trump and his administration have broad goals they want to achieve for our country, but farmers are in a desperate situation. We need a positive resolution of this ongoing tariff dispute, not further escalation of tensions.”
China has purchased only 5 million metric tons of its 20 million “good faith” promise, and the original March 1 deadline for concluding negotiations has come and gone, ASA noted.
“The market has fluctuated with each development during the negotiations, including Trump’s social media posts over the weekend,” the group said.
“After so many threats and missed deadlines for concluding negotiations, this ongoing uncertainly is unacceptable to U.S. farmers,” Stephens continued.
“With depressed prices and unsold stocks forecast to double before the 2019 harvest begins in September, we need the China market reopened to U.S. soybean exports within weeks, not months or longer.”
ASA urged the administration to hold off on additional tariffs and rapidly conclude negotiations with China, including lifting the existing Section 301 tariffs in exchange for China removing its retaliatory 25 percent tariff on U.S. soybeans.
Stephens concluded, “Soybean farmers have demonstrated great patience as the administration has sought to negotiate a better trading relationship with China. However, our patience is wearing thin as prices remain low and the tariff dispute drags on. The financial and emotional toll on U.S. soybean farmers cannot be ignored.”