Ahead of high-level Sino-U.S. trade talks, President Trump said on Monday that “I would much prefer a big deal” that would end the trade war, while at the same time touting the billions of dollars that farmers are receiving to mitigate the impact of lost exports. “We’ll see what happens next year,” said the president. “Maybe by then we’ll have it straightened out.”
Vice Premier Liu He and other Chinese officials are to meet U.S. trade representative Robert Lighthizer and Treasury Secretary Steven Mnuchin on Thursday and Friday in Washington. The White House said topics for the discussions, the latest in a series that began in the summer, include “forced technology transfer, intellectual property rights, services, non-tariff trade barriers, agriculture, and enforcement.”
“We think there’s a chance to do something substantial,” said Trump. “My inclination is to get a big deal. I would much prefer a big deal.” In recent weeks, Trump has been ambivalent about reaching agreement with China, saying on occasion that a deal might wait until after the 2020 elections.
On Monday, Trump linked trade talks with the pro-democracy demonstrations in Hong Kong. He said he hoped China would find a “humane” solution to anti-government protests. “If anything happened bad, I think that would be a very bad thing for the negotiation,” he said.
With a couple of dozen farm and ranch leaders at the White House, Trump lauded the willingness of the agricultural sector to suffer high retaliatory tariffs on sales to China so the United States could negotiate fairer trade rules with Beijing. The administration sent $8.6 billion in cash to farmers for 2018 crops and livestock, and has paid more than $5.2 billion so far on this year’s production. Up to $7.25 billion will be paid in the first tranche of 2019 aid, with two more rounds of $3.6 billion apiece possible in the months ahead. “We’ll see what happens next year,” Trump said. The administration also bought more than $1 billion in surplus food in 2018 and this year for donation.
China may be wary of a comprehensive trade agreement at this time, reported Bloomberg, citing unnamed sources. The news agency said Liu, the lead negotiator for China, told officials that he would not offer to reform Chinese industrial policy or government subsidies — two areas where the United States seeks concessions.
Private exporters sold 438,000 tonnes of soybeans worth $146 million to China for delivery this marketing year, said the USDA on Monday. The sales were the latest in a steady series of purchases that began in mid-September. Sales of U.S. pork for shipment to China were also reported in recent weeks. The purchases may be a goodwill gesture or an expression of self-interest; China is short of pork following an epidemic of African swine fever and is forecast to buy 60 percent of the soybeans on the world market this year.
“China is going to be a very big buyer. It’s already happened,” said Trump, referring to the spate of sales. China used to be the No. 1 market for U.S. farm exports. Now it is forecast to be No. 5.
U.S. ag exports fell by 6 percent during the fiscal year that ended on Sept. 30, partly due to the trade war.