China drops anti-dumping probe into imports of US sorghum

Lester Mason
May 18, 2018

The negotiations are aimed at finding a way out of the bitter trade clash between the world's top two economies.

China's vice premier, Liu He, met with President Trump and a USA negotiating team led by Treasury Secretary Steven Mnuchin on Thursday in the first of two days of talks.

"Chinese negotiators are preparing to offer the administration a deal to buy up to United States dollars 200 billion worth of American goods, which would allow Trump to claim victory in his campaign to reduce the trade deficit with China and rebalance America's trade relationship with its biggest economic rival, according to people briefed on the deliberations", The New York Times reported.

The Chinese promises would be largely illusory, economists cautioned, given the structural hurdles in China to buying more American exports and the sheer amount of goods the United States would have to produce to meet Beijing's demand, the daily reported. It bought $130 billion of American goods previous year, according to United States government figures.

Beijing's announcement that it was ending its investigation, which effectively halted a trade worth roughly $1.1 billion past year, came hours after USA officials familiar with the matter said China was offering a package to slash the US trade deficit by up to $200 billion. But that could cause disruptions to supply chains and create tensions with the affected countries.

A field of sorghum (milo) grain is seen at a farm outside of Texhoma, Oklahoma, U.S., in this undated photo released to Reuters on April 3, 2018.

He also said possible modifications to crushing restrictions that have paralyzed Chinese telecommunications equipment maker ZTE Corp (000063.SZ)(0763.HK) could be part of a trade deal. But the USA government "might not be willing to do that", he added.


Trump said Sunday that he was working on giving ZTE "a way to get back into business, fast", adding that he had instructed the US Commerce Department to "get it done". But Trump tweeted Wednesday that "nothing has happened with ZTE except as it pertains to the larger trade deal".

Experts say Beijing is trying to engineer a deal focused on the trade imbalance rather than cede to U.S. pressure over its industrial policies aimed at boosting Chinese high-tech industries.

"That's an enormous number and it suggests that there could be some impressively ambitious accounting", said Scott Mulhauser, a former chief of staff at the U.S. Embassy in Beijing and U.S. Export-Import Bank official who now advises companies on trade issues.

China has signaled its not interested in changing its industrial policies, which it views as crucial for developing its economy.

China and the United States have imposed - or threatened to impose - tariffs on various goods, in what observers warn could escalate into a larger trade war.

China ended an anti-dumping investigation into imports of US sorghum on Friday, as talks continue in Washington on the trade dispute between the two nations. Beijing had previously accused American farmers of dumping sorghum on its markets and announced last month it would start putting a huge import charge on the crop.

The Ministry of Commerce said it was terminating (link in Chinese) the probe after receiving comments from the Chinese livestock industry saying the anti-dumping measures would be likely to push up costs, which would then be passed on to the public.

Other reports by Iphone Fresh

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