If a trade deal cannot be reached between the world's two largest economies, imposing a large amount of U.S. tariffs will reshape global trade, while China and the world's top agricultural importer China will buy more meat, dairy and grains from producers in South America, Europe and the Pacific.
Industry officials and analysts say the victims of these changes may be farmers in the United States if they can’t find other markets, while the beneficiaries may be soybean suppliers in Brazil, wheat growers in Australia and pork suppliers in Europe, New Zealand or elsewhere.
China quickly retaliates against new U.S. duties on Tuesday, announcing 10% and 15% of hiking in import taxes Covering US agricultural supplies worth $21 billion.
See also: China raises deficits to avoid trade wars and increase consumption
“After China's import tariffs on U.S. goods will be re-layouted in trade,” said Pan Chenjun, senior analyst at Rabobank, Hong Kong.
“The main products that will affect are pork inside and chicken feet. For pork, muscle and heart, China will get more supply from Brazil, Spain, the Netherlands and other EU countries.”
China reduces its dependence on American agricultural commodities
China is the largest market for U.S. farm exports, buying $29.25 billion worth of products in 2024, and any shift in trade flows could create opportunities for rival exporters.
Since the trade war, China will curb its dependence on American agriculture since President Donald Trump's first term.
Trump also imposed a duty on goods from Canada and Mexico on Tuesday, which could hurt the US $191 billion in US agricultural exports. But Commerce Secretary Howard Lutnick suggested Wednesday that tariffs imposed on U.S. neighbors could be relaxed, depending on how negotiations go in the coming days and weeks.
China imported US beef, pork and chicken worth $16.26 billion in 2024, but in the counterattack, it has announced a 15% tariff on U.S. chicken products and 10% tariff on pork and beef.
Analysts say meat goods are expected to increase in Europe and South America. Although China conducted an anti-dumping investigation into EU imports of pork and dairy products last year, sales were not affected.
However, China's dependence on the U.S. on chicken feet is likely to continue, as alternatives will be difficult to purchase completely and quickly.
“At the same time, the importer of chicken feet will only perform the duties and imports of imports from the United States,” Pan said.
China is a key importer of American chicken feet, pork and viscera – its food items, but in demand in the United States is very small.
More cereals from Brazil, Australia
Although about half of our soybean exports have been exported to China since Trump’s first term, the world’s number one buyer has reduced reliance on U.S. oil seeds.
The latest tariffs on our soybeans indicate a greater reliance on Brazil and Argentina.
“From a soybean perspective, South American suppliers may benefit,” said Dennis Voznesski, an analyst at the Commonwealth Bank of Sydney.
China still relies on US sorghum to buy about two-thirds, and Beijing’s 10% responsibility for animal feed cereals could benefit Australian farmers.
“Sorghum will be a clear winner. Barley may also benefit. “The crops harvested in Australia this year are huge. ”
U.S. wheat is also expected to be higher for Australian suppliers, although China has lowered overall wheat imports in recent months due to large local supply.
- Jim Pollard's Extra Input and Editing by Reuters
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