The United States and China today signed a “Phase 1” trade agreement that both countries say will lead to increased purchases of U.S. agricultural products by China.
“Today’s signing is an important step in giving America’s farmers and ranchers the ability to get back to business in the global market," said Zippy Duvall, president of the American Farm Bureau Federation. "China was once the largest market for U.S. agricultural products but has dropped to fifth largest since retaliatory tariffs were introduced. This agreement will help turn around two years of declining agricultural exports. The potential of tens of billions more in exports is welcome news for farmers who are eager to compete on a more level playing field. This is a great way to start the new year, but there is more work to do. We encourage the Senate to pass the U.S.-Mexico-Canada Agreement to increase export opportunities with our North American neighbors. We also look forward to additional trade agreements with countries that are locking-in deals with our competitors. This must be a focus in 2020.”
The agreement takes effect in 30 days, and as a result of the agreement the U.S. did not impose threatened tariffs on $160 billion of Chinese imports in 2019. As part of the agreement, China has agreed to purchase at least $45 billion of U.S. agricultural products per year over the next two years. Specific amounts for product purchases have not been released. According to news outlet Agri-Pulse, President Trump intends to keep tariffs at 25% on a remaining $250 billion of imports from China.
"This is a great start for American and Utah agriculture," said Ron Gibson, President of the Utah Farm Bureau Federation. "Many farm and ranch families have been struggling as a result of these tariffs, and we hope this is just the start of good things to come."
Over the next two years, China could potentially purchase up to $50 billion worth of agricultural products annually, according to U.S. officials.