Tariffs are at the heart of a trade war between the U.S. and China. Chinese purchases of U.S. agricultural commodities have taken a nosedive since China imposed tariffs on them in retaliation for steep U.S. import taxes on items like steel and aluminum.
In mid-summer China slapped a 25-percent tariff on imports of U.S. soybeans. By October, Chinese imports of American soybeans were down 95 percent as compared to a year ago. China is the world’s largest consumer of soybeans, much of it used as feed for the Chinese pork market.
The tariffs are impacting growers in the US, the Rome News-Tribune reports. Brothers Charles and Irwin Bagwell said the tariffs on steel and aluminum have driven the prices of farm machinery up significantly. Irwin said the price of a John Deere combine they bought three years ago has already gone up $100,000. He’s glad they made the investment when they did, because they’re not getting any more at market for their corn or soybeans.
One company that has been forced to up prices is Albaugh. "Though Albaugh has a very diverse supply chain based on production in the USA, Argentina, Mexico, Brazil, Europe and India, on some products only China offers commercially or viable supply. In such cases, we are left with no alternative but to increase prices reflective of the higher tariffs. Additionally, it has been announced that the new tariffs will be increased to 25% beginning January 1, 2019, in which case prices will again be adjusted", they state in a news release.