U.S. President Donald Trump says “kind, not full” retaliatory tariffs went into effect midnight for more than 50 trading partners, including China.
“We’re going to be charging a discounted reciprocal tariff of 34 percent. In other words, they charge us, we charge them. We charge them less, so how can anybody be upset?”
There are now double digit reciprocal tariffs on many countries, including Japan, Vietnam and South Korea. Trump says the countries charge over-quotas for U.S. rice.
“That’s because they don’t want us selling rice,” he says. “And who can blame them madam secretary, agriculture, a great job you did on eggs, by the way.”
The European Union has a 20 percent tariff and India has 26 percent tariff. There is a 10 percent tariff on other trading partners, including Brazil and the United Kingdom.
Ted McKinney with the National Association of State Departments of Agriculture (NASDA) says some of the tariff amounts aren’t surprising.
“I’m encouraged with the UK and Brazil. Although I think our farmers would have liked to have had zero, it suggests there might be an opening there to straighten out some trade.”
But McKinney says reciprocal tariffs are a new approach and the duration is important.
“If this is a forever thing, there will be a lot of hand-wringing,” says McKinney. “If this might be a temporary kind of thing, which he won’t telegraph, he won’t talk about the duration, maybe there’s some hope some change in process, their tariff mentality, could result in some kind of settlement.”
The administration moved the announcement until after markets closed. In after-hours trading, markets responded to the news and moved lower.
Market analyst Tommy Grisafi with Nesvick Trading Group says it’s anyone’s guess how the grain markets respond.
“This isn’t like, we’re fighting with Canada and Mexico, 24-hour fake tariff war we had, this one feels real.”
Canada and Mexico didn’t make the retaliatory tariff list.
Trump has also issued a new executive order, calling unfair trade an economic emergency.
