BEIJING/SINGAPORE (Reuters) - China and the United States have agreed terms of a Phase 1 trade deal under which the United States reduced some tariffs and Beijing canceled retaliatory duties that were scheduled to take effect on Dec. 15.
Before the Dec. 15 deal, U.S. corn, sorghum, wheat, undenatured ethanol and refined copper cathodes had faced an additional tariff of 10% on shipments to China. Propane, cotton, aluminium scrap, copper scrap and rare earth magnets were all set for an additional 5% duty.
Below is a list and timeline showing how China’s tariffs on key U.S. commodities and energy items stand after the Phase 1 accord.
China imposed a 5% tariff on U.S. crude oil shipments from Sept. 1, the first time U.S. oil had been targeted since the trade war between the world’s two biggest economies started more than a year ago. The 5% tariff was not affected by the Phase 1 deal.
China, the world’s biggest crude importer, has cut U.S. shipments from a record high last year. Chinese customs data showed imports in the first 10 months were halved year-on-year to 146,275 barrels per day.
China removed an additional 5% tariff on U.S. propane shipments that was set to take effect from Dec. 1. A 25% duty that China imposed on U.S. propane on Aug. 23, 2018, remains in place.
Chinese firms process U.S. propane into petrochemicals such as propylene. Imports last year were worth an estimated $2 billion.
LIQUEFIED NATURAL GAS (LNG)
China imposed a 10% punitive tariff on U.S. LNG shipments in September 2018, raising it to 25% in June. LNG duties were not affected by the Dec. 15 deal.
Imports of the super-chilled fuel in the first 10 months of 2019 shrank 87.2% on the year to 258,955 tonnes, according to Chinese customs.
METHANOL, ETHYLENE GLYCOL (MEG)
China imposed tariffs of 25% on U.S. methanol and MEG in June this year. They were not affected by the Dec. 15 deal.
No additional duties had been scheduled to come into effect on Dec. 15.
A 25% tariff on soybeans in July 2018 had halted all buying by commercial buyers, but Chinese crushers went back to the U.S. market following a trade truce in December last year. An additional 5% duty came into effect in September. The Chinese government has given tariff exemptions to some U.S. soybean imports.
China bought 11.3 million tonnes of soybeans from the United States in January-October, down 31.8% from last year. The United States has sold at least another 1.5 million tonnes of beans to Chinese crushers since early November.
American pork faces total import duties of 72% after including the 12% “most-favoured nation” tariff. These duties were not changed in the Dec. 15 deal, but China is expected to boost U.S. meat imports. An outbreak of African swine fever in China has decimated the world’s largest pig herd and sent domestic pork prices soaring to record levels.
Total import tariffs on U.S. frozen pork will go down to 68% from Jan. 1, when the cut in tariff rates on frozen pork shipments from all countries - which does not apply to carcasses, chilled pork and offal - takes effect.
An additional duty of 5% on U.S. aluminium scrap, which was to go into effect on Dec. 15, has been canceled. The material was already affected by an initial 25% tariff in April 2018, following by another 25% increase in August 2018.
Shipments to China were down only 17.3% year-on-year in the first 10 months of 2019, but those of U.S. scrap copper, subject to a 25% tariff since August 2018, crashed by 76.6% over the same period.
China, which this year raised the prospect of restricting rare earth exports to the United States but has not announced any formal measures, removed the extra 5% tariff on imports of U.S. permanent rare earth magnets from December as part of the Phase 1 deal. A 25% tariff on U.S. rare earth ore imports has been in effect since June 2019.
Reporting by Chen Aizhu, Muyu Xu, Dominique Patton, Tom Daly, Shivani Singh and Hallie Gu; editing by Kenneth Maxwell, Robert Birsel and Larry King
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