Cargill has doubts about US trade strategy
Cargill is concerned that the US strategy to address unfair trade practices with China will not work and could lead to an escalating trade war, according to prepared comments the global grain merchant sent to U.S. Trade Representative Robert Lighthizer. The five-page letter, submitted on Friday and made public on Monday, was in response to a request for public comments by Lighthizer’s office over its “Section 301” investigation, which authorizes tariffs in a bid to force changes to Chinese government policies over intellectual property.
The Trade Representative on Tuesday will begin holding three days of public hearings on proposed U.S. tariffs of 50 billion USD on Chinese goods. The hearings, being held in Washington, are part of an expected 60-day public consultation period that USTR is pursuing before any of the so-called 301 tariffs can be activated. President Donald Trump has threatened tariffs on imports of Chinese goods, and China has threatened to retaliate with duties on U.S. products, including meat, soybeans and aircraft.
However, growing trade disputes are disrupting agricultural supply chains worldwide, with ships carrying U.S. sorghum exports turning around after China raised prices for buyers. In the short term, U.S. farmers will be hurt the most by declining prices linked to China’s tariffs on soybeans. The crop is the top U.S. agricultural export to China, worth 12 billion USD last year. Top U.S. trade and economic officials are preparing to meet this week in Washington with Chinese Vice Premier Liu He for talks on trade concerns ranging from intellectual property protections to farm goods to steel capacity.