UNITED States president Donald Trump will be out of the White House by the end of January, but his legacy is likely to remain for some time and it will have an impact in Australia. One of the most prominent marks which Mr Trump made on agriculture was a trade war between China and the US. He hit out with tariffs against Chinese imports, which resulted in China slapping hefty tariffs on a range of US agri-products.
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The result was that a large volume of products usually sourced from the US being switched to other origins. The biggest example was the large switch of soybeans from the US to Brazil. The two nations got to the negotiating table at the end of 2019 and agreed to a phase 1 deal. This was an agreement that China would purchase a large volume of various products in 2020 and 2021 - including that China would ramp up purchases of US agricultural commodities. Under the terms of the deal, China would purchase $US36.6b in agricultural commodities, a significant rise above the $US24.1b purchased in the pre-tariff year of 2017. The Thomas Elder Markets (TEM) team has been discussing the phase 1 deal as a major challenge for Australian agriculture for the past year, and expects that China will have to preference goods from the US in order to protect its export markets. The data from this analysis has been taken from the monthly data provided by the Chinese customs authority. To determine the ...
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