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U.S. reaches trade deal with U.K., pauses tariffs on China

In two major developments for U.S. international trade, the White House announced a trade deal with the United Kingdom and a pause on reciprocal tariffs between the U.S. and China.

On May 8, President Donald Trump and British Prime Minister Keir Starmer announced a trade deal the White House said will allow American companies “unprecedented access” to U.K. markets

According to a White House press release, the U.S.-U.K.-Northern Ireland Economic Prosperity Deal will create $5 billion in opportunities for new exports for U.S. farmers, ranchers, and producers.

The deal calls for U.S. exports of more than $700 million worth of ethanol and $250 million in other ag products, including beef. The nations agreed to work together to enhance industrial and agricultural market access, the White House said.

“Farm Bureau appreciates the work between the administration and the United Kingdom to secure a new trade agreement,” AFBF President Zippy Duvall said. “We have long advocated for new trade deals, and this is an important first step in expanding markets in the four countries. More work is needed, however, to remove the arbitrary barriers that have excluded American-grown food from grocery stores in the U.K.”

On May 12 following trade talks in Switzerland, the U.S. and China agreed to a 90-day suspension of tariffs levied against one another since April 2. According to a White House fact sheet, each side was to begin lowering duties on imports from the other by 115%. U.S. tariffs on imports from China will drop from 145% to 30%, while Chinese duties on imports from the U.S. drop from 125% to 10%. The actions lowering the tariffs were to begin on May 14. The agreement calls for continued trade negotiations during the suspension period.

Soybeans are the U.S.’ top ag export to China, where the commodity is the key component in feed for China’s pork producers. In a May 12 statement, the American Soybean Association (ASA) expressed appreciation for the deal but noted that there are no Chinese tariffs on imports of soybeans from Brazil, and that the 90-day pause will expire in August, just prior to harvest season for soybeans.

“Farmers want to play their part in supporting broad-based, long-term solutions to the administration’s concerns and help our fellow U.S. citizens when possible; but we cannot sustain tariffs that are exponentially higher than those of the first China trade war, which knocked out our largest export market overnight, if they linger into our fall harvest season,” ASA President Caleb Ragland. “We hope that a deal can be reached in which China commits to robust purchases of U.S. soybeans and other products very soon.”

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