Retaliatory Tariffs and U.S. Agriculture
September 5, 2019
Certain foreign nations have targeted U.S. food and agricultural products with retaliatory tariffs
since early 2018 in response to U.S. Section 232 tariffs on steel and aluminum imports and
Anita Regmi
Section 301 tariffs levied on U.S. imports from China. Retaliatory tariffs have made imports of
Analyst in Agricultural
U.S. agricultural products relatively more expensive compared to similar products from
Policy
competitor nations. In the short run, U.S. shipments of products to countries with retaliatory

tariffs have declined, reducing overall global demand for affected U.S. agricultural products and
driving down the prices of U.S. agricultural commodities. Depending on the length and depth of

the tariffs and the range of products affected, some experts caution that the long-run trade
impacts could inflict further harm as U.S. competitor countries have an incentive to expand their agricultural production.
In response to U.S. Section 232 and Section 301 actions, China levied retaliatory tariffs on almost all U.S. agricultural
products, ranging from 5% to 50%. In response to U.S. Section 232 tariffs, Canada, Mexico, the European Union (EU), and
Turkey retaliated with tariffs during the summer of 2018 on U.S. fruit, nuts, prepared vegetables and meats, pork, cheese,
breakfast cereal, fruit juices, and whiskey. India implemented retaliatory tariffs on certain U.S. products after a Presidential
Proclamation removed India from the U.S. Generalized System of Preferences program in May 2019. Canada and Mexico
levied retaliatory tariffs in mid-2018, but these tariffs were removed in May 2019 after the Trump Administration announced
an agreement with Canada and Mexico to remove the Section 232 tariffs on imports from both countries to facilitate
ratification of the U.S.-Mexico-Canada Agreement—a proposed regional free trade agreement that is meant to supersede the
North American Free Trade Agreement (NAFTA).
The total value of exports of U.S. food and agricultural products levied retaliatory tariffs in 2018 was $22 billion, down 27%
from $30 billion in 2017. China accounted for about 80% of the total affected trade in both years. Despite the retaliatory
tariffs, U.S. agricultural exports rose in 2018 to $140 billion
U.S. Agricultural Exports to China, 2014-2018
from $138 billion in 2017, partly due to higher imports during
In Nominal Billions of U.S. Dollars
the months leading up to the retaliatory tariffs and increased
exports to other non-retaliating countries. With the
continuation of retaliatory tariffs, U.S. Department of
Agriculture (USDA) projects U.S. agricultural exports to
decline about 4% in 2019.
In the short-run, retaliatory tariffs contributed to declining
prices for certain U.S. agricultural commodities and reduced
exports, particularly for soybeans. Declining prices and exports
sales combined with rising input and farm machinery costs
contributed to a 16% decrease in U.S. net farm income in
2018, compared with 2017. China’s soybean imports are
expected to resume growing over the next decade, but a USDA
study expects the volume traded to be less than previously
anticipated. Because of the retaliatory tariffs on U.S. soybeans,
USDA projects that Brazil will account for two-thirds of the
global growth in soybean exports to China. The United States
accounted for 40% of China’s total soybean imports in 2016

and 35% in 2017, compared with Brazil’s 46% in 2016 and
Source: U.S. Census trade data, accessed July 2019.
53% in 2017. In 2018, the U.S. share of China’s soybean
Note: Data is in calendar years, January to December.
import market dropped to 19% and Brazil’s share was up at
76%.
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Retaliatory Tariffs and U.S. Agriculture

To help alleviate the financial loss incurred by U.S. farmers due to retaliatory tariffs, USDA announced $12 billion in
financial assistance in 2018—referred to as a trade aid package—for certain U.S. agricultural commodities using Section 5 of
the Commodity Credit Corporation (CCC) Charter Act (15 U.S.C. 714c). In 2019, USDA announced a second trade-aid
package of $16 billion. Increased trade-aid to U.S. farmers has generated questions from some World Trade Organization
(WTO) members about whether the trade-aid package may violate U.S. WTO commitments.
While trade-aid packages may provide short-term financial
Chinese Imports of Russian Agricultural Products, 2016-2018 assistance, some studies and critics of the President’s
In Nominal Million U.S. Dollars
actions caution that the long-term consequences of the
retaliatory tariffs may present more challenges. Even as
China has raised tariffs on U.S. imports, it has improved
access to its markets for other exporting countries. Brazil,
Russia and other countries are expanding their agricultural
production to meet China’s import demand. For example,
Russia’s investments during the past two decades have
resulted in agricultural productivity growth ranging from
25% to 75%, with higher productivity growth along its
southern region. Although still at relatively modest levels,
China’s total food and agricultural imports from Russia
increased 61% between 2017 and 2018.
The continuation of trade disputes and retaliatory tariffs
may be of interest to Congress for the following reasons.
Trade disputes have disrupted global markets and increased
uncertainty in the farm input and output sectors. They may
add to production costs, they have dampened exports,
impacted farm income, and triggered additional federal
Source: China Customs Statistics accessed via Global Trade
Atlas, July 2019.
assistance for the farm sector. In the short-run, there could
be some transient benefits associated with various aspects
Notes: Other animal prods = Other animal products
of the agricultural sector. In the long-run, other countries
may expand agricultural production, potentially displacing U.S. agricultural exports to become larger food and agricultural
suppliers to China.
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Retaliatory Tariffs and U.S. Agriculture

Introduction
Since early 2018, certain foreign nations have targeted U.S. food and agricultural products with
retaliatory tariffs (for more on tariffs, see Box 1) in response to U.S. Section 232 tariffs on steel
and aluminum imports and U.S. Section 301 tariffs levied on imports from China.1 The first U.S.
trade action occurred on March 8, 2018 when President Trump imposed tariffs of 25% on steel
and 10% on aluminum imports (with some flexibility on the application of tariffs by country)
using presidential powers granted under Section 232 of the Trade Expansion Act of 1962.2
Section 232 authorizes the President to impose restrictions on certain imports based on an
affirmative determination by the Department of Commerce that the targeted import products
threaten national security. The targeted exporters, China, Canada, Mexico, the European Union
(EU), and Turkey, responded by levying retaliatory tariffs on U.S. food and agricultural products,
and other goods. India proposed retaliatory tariffs but did not implement them until June 2019.
A second action occurred in July 2018 when the Trump Administration used a Section 301
investigation to impose tariffs of 25% on $34 billion of selected imports from China, citing
concerns over China’s policies on intellectual
property, technology, and innovation.3 In
Box 1. Tariffs and Harmonized Tariff
August 2018, the Administration levied a
Schedules
second round of Section 301 tariffs, also of
A tariff is a customs duty levied on imported goods and
25%, on an additional $16 billion of imports
services. When a good enters a U.S. port of entry,
from China. In September 2018, additional
merchandise is classified and tariffs are assessed using
the U.S. Harmonized Tariff Schedule (HTS), a
tariffs of 10% were applied to $200 billion of
compendium of tariff rates based on a globally
imports from China and, in May 2019, these
standardized nomenclature. At the global level, the
were raised to 25%.4 On August 13, 2019, the
Harmonized System (HS), established by the World
Office of U.S. Trade Representative (USTR)
Customs Organization, is the standardized
published two lists of additional Chinese
nomenclature for the classification of products. It
allows participating countries to classify traded goods
imports that would face 10% tariffs, effective
on a common basis for customs purposes. The HS
September 1, 2019 and December 15, 2019.5
codes are standard up to 6-digits, the most detailed
The imposition of the Section 301 tariffs on
level that can be compared internationally. Beyond 6-
Chinese goods resulted in retaliatory tariffs by
digits, countries can introduce national distinctions for
China. Additionally, in August 2019, China
tariffs and for other purposes. The U.S. HTS code
agrees with the HS code at the 6-digit level, but may
asked its state-owned enterprises to halt
vary from other countries at 8- or higher digit levels.
purchases of U.S. agricultural goods.6 On
August 23, 2019, China further retaliated by levying two additional sets of tariffs: 5% or 10%
tariffs on U.S. imports, including 695 different U.S. agricultural tariff lines effective September 1,

1 For more information, see CRS Insight IN10943, Escalating U.S. Tariffs: Timeline; and CRS Insight IN10971,
Escalating U.S. Tariffs: Affected Trade.
2 For more information, see CRS Report R45249, Section 232 Investigations: Overview and Issues for Congress.
3 Section 301 of the Trade Act of 1974 allows the United States Trade Representative (USTR) to suspend trade
concessions or impose restrictions if it determines a U.S. trading partner is violating trade commitments or engaging in
discriminatory or unreasonable practices that burden or restrict U.S. commerce. CRS Insight IN10943, Escalating U.S.
Tariffs: Timeline.
4 Office of U.S. Trade Representative (USTR), “Notice of Modification of Section 301 Action: China's Acts, Policies,
and Practices Related to Technology Transfer, Intellectual Property, and Innovation,” May 9, 2019.
5 USTR, “USTR Announces Next Steps on Proposed 10 Percent Tariff on Imports from China,” August 13, 2019.
6 Yang, Y. and A. Zang, “China Tells Companies to Stop Buying U.S. Agricultural Goods,” Financial Times, August 5,
2019.
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2019; and another 5% or 10% tariffs on U.S. imports including 184 different U.S. agricultural
tariff lines effective December 15, 2019.7
During 2018, China, Canada, Mexico, the EU and Turkey jointly levied retaliatory tariffs on more
than a thousand U.S. food and agricultural tariff lines. India prepared a list of U.S. products
targeted for retaliatory tariffs in 2018 but refrained from implementing them. Then in 2019, India
implemented retaliatory tariffs on certain U.S. lentils, apples and tree nuts8 after the United States
removed India from U.S. Generalized System of Preferences (GSP) program on May 31, 2019.9
GSP provides duty-free tariff treatment for certain products from designated developing
countries. India’s removal from GSP is expected to raise duties valued at about $5 billion to $6
billion on goods the U.S. imports from India—or slightly more than 10% of India's total 2018
exports of $54 billion to the United States.10 In response to U.S. action, India implemented the
retaliatory tariffs identified in 2018, with some changes, effective June 16, 2019.11
On May 17, 2019, the Trump Administration reached an agreement with Canada and Mexico to
remove the Section 232 tariffs on steel and aluminum imports from those countries and to remove
all retaliatory tariffs imposed on U.S. goods.12 The Administration reduced tariffs on Turkish steel
imports, and Turkey responded on May 21, 2019, by halving its retaliatory tariffs on U.S.
imports.13
Report Objectives
This report recaps the chronology and the effect of U.S. Section 232 and Section 301 actions on
U.S. food and agricultural imports and, the retaliatory tariffs imposed on U.S. agricultural exports
by its trading partners during 2018 and the spring of 2019. As China is subjected to the largest set
of U.S. tariff increases and has levied the most expansive set of retaliatory tariffs on U.S.
agricultural products, this report largely focuses on the effects of Chinese retaliatory tariffs on
U.S. agricultural trade. Because almost all U.S. food and agricultural tariff lines are affected by
Chinese retaliatory tariffs, the report provides illustrative examples using selected agricultural
products. Thus, the report is not a comprehensive review of the effect of Chinese retaliatory
tariffs on every U.S. agricultural product exported to China.
Retaliatory tariffs have made U.S. products relatively more expensive in China, with the result
that Chinese imports from other countries have increased in lieu of U.S. products. This report
discusses the short- and long-run economic effects of the changes in trade flows, locally,
nationally, and globally. The long-run effects may potentially be more problematic as China and

7 USDA, FAS, “China Announces Increases to Additional Tariffs,” GAIN Report Number:CH19051, August 28, 2019.
8 India, Immediate Notification Under Article 12.5 of the Agreement on Safeguards to the Council for Trade in Goods
of Proposed Suspension of Concessions and other Obligations Referred to in Paragraph 2 of Article 8 of the Agreement
on Safeguards, World Trade Organization (WTO) May 18, 2018.
9 84 Federal Register 26323, May 31, 2019.
10 Palmer, D. “Trump Ends Trade Benefits for India, Raising Tariffs on Billions in Imports,” Politico, May 31, 2019.
11 The Government of India, The Gazette of India, Part II, Section 3, Number 357, Customs Notification No. 16/2019,
June 15, 2019.
12 USTR, “United States Announces Deal with Canada and Mexico to Lift Retaliatory Tariffs,” Press Release, May 17,
2019.
13 USDA, Foreign Agricultural Service (FAS), “Turkey Reduces Additional Levies on U.S. Products,” GAIN Report
Number: TR9012, May 22, 2019. On June 1, 2018, the United States began applying 25% steel and 10% aluminum
tariffs on Turkish imports under Section 232. These tariffs were doubled on August 10, 2018. In response to U.S.
action, Turkey had increased its retaliatory tariffs, which it halved when the United States reduced its tariffs in May
2019. See CRS In Focus IF10961, U.S.-Turkey Trade Relations.
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Russia have increased their agricultural productivity over the last 2 to 3 decades,14 and China has
increased investments in other countries to develop potential future sources of imports.15
Additionally, China has improved market access for imports from other countries while it has
increased tariffs on U.S. imports. Finally, the report presents the views of selected U.S.
agricultural stakeholders on retaliatory tariffs, and it identifies issues that may be of interest for
Congress.
Retaliatory Tariffs on U.S. Agricultural Exports
Except for China, that faces both Section 232 and Section 301 tariffs, other countries’ retaliatory
tariffs respond only to U.S. Section 232 tariffs on U.S. imports of certain steel and aluminum
products. Higher retaliatory tariffs represent increases above the World Trade Organization
(WTO) Most Favored Nation (MFN) tariff rates or beyond any existing preferential tariff rates.
Retaliatory tariffs for Canada and Mexico are increases from the existing North American Free
Trade Agreement (NAFTA) rates, most of which at zero percentage, are below the MFN rates.
Box 2. Two Types of Tariffs: Ad Valorem and Specific
Ad valorem tariffs are applied as a percentage of the import value of a good, while specific tariffs are applied as a
specific monetary value per quantitative unit (such as per ton or per kilogram). When the price of a traded
product changes, the ad valorem tariff rate may change even though the implemented specific tariff has not changed.
For purposes of analyses, specific tariffs are generally converted to ad valorem rates.
Table 1 summarizes the retaliatory tariff increases on U.S. agricultural products by comparing
tariff increases of September 2018 with the retaliatory tariffs in effect in June 2019.16 A potential
reason for observed changes in applied tariffs rates is that some tariffs are levied based on
quantity (such as per ton or per kilograms) and, for purposes of analyses, tariffs are converted to
percentage of total import value, ad valorem rates (See Box 2). When the price of a traded
product changes, the ad valorem tariff rate imposed on a product can change. Additionally, it is
not always possible to match the U.S. Harmonized Tariff Schedule17 (HTS) with the retaliatory
country’s 8- or 10-digit tariff code (see Box 1). Thus, it may be difficult to link the U.S. Census
trade data with the tariff codes of products affected by retaliatory tariffs. Therefore, this report
makes use of both U.S. export data and partner country import data as appropriate to provide the
most accurate measure of the magnitude of the affected U.S. trade. For U.S. retaliating trade
partners, Table 1 provides the minimum, maximum, and simple (not trade-weighted) average
retaliatory tariff hike rates.

14 Rada et al. “Productivity Growth and the Revival of Russian Agriculture,” ERR Number 228, USDA, Economic
Research Service (ERS), April 2017; and Wang, S. et al., “China’s Regional Agricultural Productivity Growth in 1985-
2007: A Multilateral Comparison,” Agricultural Economics, March 2013, no. 44, 2013, pp. 241-251.
15 Gooch and Gale, “China’s Foreign Agriculture Investments,” Economic Information Bulletin, Number 192, USDA,
ERS, April 2018; and Chen et al., China-Africa Agricultural Modernization Cooperation: Situation, Challenges and
the Path Ahead, International Food Policy Research Institute, 2018.
16 Unless otherwise identified, agricultural and food products considered for the retaliatory tariffs include most of
chapters 1 to 24 of the U.S. Harmonized Tariff Schedule (HTS), which cover meat, grains, animal feed, dairy,
horticultural products, processed foods, unprocessed tobacco, seafood, and alcoholic beverages; and also include
essential oils in chapter 33; animal hides and skins in chapters 41 and 43; and silk, cotton, and wool in chapters 50, 51,
and 52. Fishery products (chapters 3 and parts of 16) and forest products (chapter 44) are not included in this report.
17 United States International Trade Commission (USITC), Official Harmonized Tariff Schedule, 2019,
https://www.usitc.gov/tata/hts/index.htm.
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Table 1. Comparison of Retaliatory Tariff Hikes on U.S. Agricultural Products:
September 2018 versus June 2019
Percentage Increases Over World Trade Organization (WTO) Most Favored Nation (MFN) Tariff Rates
or Rates Under the North American Free Trade Agreement (NAFTA)
Tariffs increases as of
Tariff increases as of
September 2018
June 2019
Country
Productsa
Effective
Minb
Maxc Avgd
Minb
Maxc Avgd
First of 5
China
tranches
e
Almost all products
5%
50%
20%
5%
50%
24%
initiated April
2, 2018.
Coffee; prepared
Canada
meats, fruit, vegetables
f
July 1, 2018
10%
10%
10%
0%
0%
0%
and other products;
whiskey
Pork; cheese apples;
Mexicof
prepared fruits and
June 5, 2018
7%
25%
18%
0%
0%
0%
vegetables; whiskey
Prepared vegetables
European
and legumes; grains;
Union
June 22, 2018
10%
25%
24%
10%
25%
24%
fruit juice; peanut
butter; whiskey
Tree nuts; rice;
Turkeyg
miscellaneous prepared
June 21, 2018
20%
140%
58%
10%
70%
29%
foods; whiskey; tobacco
Indiah
Almonds; walnuts;
apples; chickpeas; lentils June 16, 2019
0%
0%
0%
10%
29%
18.5%
Source: USDA, Foreign Agricultural Service (FAS), various GAIN Reports: CH18034, June 21, 2018; CH18034,
August 6, 2018; CH19030, May 17, 2019; E18045, June 21, 2018; TR8018, June 28, 2018; TR9012, May 22, 2019;
MX8028, June 6, 2018; and IN8108, September 21, 2018; The Gazette of India, Customs Notification No.
16/2019, June 15, 2019; Department of Finance, Canada, “Notice of Intent to Impose Countermeasures Action
Against the United States in Response to Tariffs on Canadian Steel And Aluminum Products,” May 31, 2018;
Toubia et al., “Canada and Mexico Eliminate Section 232 Steel/Aluminum Countermeasures as of May 20,”
International Trade Law, May 20, 2019.
Notes: MFN tariff rates are the tariff rates that WTO members levy on imports from other WTO members,
excluding those with whom a preferential trade agreement may exist. Canada and Mexico have signed NAFTA
with the United States and levy tariff rates lower than the MFN rates—zero on almost all U.S. imports.
a. Products include most of chapters 1-24 of the U.S. Harmonized Tariff Schedule, which cover meat, grains,
animal feed, dairy, horticultural products, processed foods, unprocessed tobacco, alcoholic beverages; plus
essential oils in chapter 33; animal hides and skins in chapters 41 and 43; and silk, cotton, and wool in
chapters 50, 51, and 52. Fishery products (chapter 3 and parts of chapter 16) and forest products are not
considered in the table.
b. Min = minimum retaliatory tariff levied by the country on the listed products.
c. Max = maximum retaliatory tariff levied by the country on the listed products.
d. Avg = Simple average (unweighted) tariff rates for the listed products. Within a category of traded products,
trade may mostly occur for a few products’ harmonized tariff lines rather than being evenly divided across
all lines. Weighted averages are therefore considered as the “effective” average tariff rates.
e. China imposed the first set of retaliatory tariffs (in response to 232 tariffs) in April 2018, fol owed by the
first round in response to 301 tariffs in July 2018, then successive rounds in August 2018, September 2018
and finally in June 2019.
f.
Canada and Mexico removed their retaliatory tariffs effective May 20, 2019, and have in effect the zero
NAFTA tariffs.
g. Turkey halved the retaliatory tariffs on U.S. imports on May 21, 2019 in response to U.S. action that
reduced tariffs on Turkish steel imports.
h. India proposed retaliatory tariffs in June 2018, but implemented them effective June 16, 2019.
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Chinese Retaliatory Tariffs18
China is subject to the largest set of U.S. tariff increases—both the U.S. Section 232 steel and
aluminum tariffs and the Section U.S. 301 tariffs in response to unfair trade practices. As a result,
China has countered with an expansive list of retaliatory tariffs. In particular, all U.S. products
affected by Chinese retaliatory tariffs in response to the U.S. Section 232 action also faced
additional retaliatory tariffs in response to U.S. Section 301 trade action.
China first retaliated against U.S. Section 232 action in April 2018, by raising tariffs on certain
U.S. imports including agricultural products.19 During the first round of Chinese retaliatory
tariffs, these products included pork, fruit, and tree nuts. In July 2018, China retaliated against
U.S. Section 301 tariffs by raising tariffs on an expanded number of products, including most
U.S. agricultural products exported to China.20 Tariffs were also raised on products affected by
the earlier April 2018 retaliatory tariffs in response to U.S. Section 301 action, with most subject
to an additional tariff of 25%.
China levied two more rounds of retaliatory tariff increases (against U.S. Section 301 action) in
2018—in August and September—expanding the coverage of the affected products. In September
2018, China imposed 5% and 10% tariff increases on certain products (including agricultural
products) which had not been subject to any retaliatory tariffs in response to U.S. Section 301
action.21 In June 2019, China increased tariffs on some additional products that had not been
previously targeted with retaliatory tariffs, as well as some products that had been hit with the 5%
or 10% retaliatory tariff in September 2018.22 As a result, almost all U.S. agricultural products
shipped to China face retaliatory tariffs, ranging from 5% to 50% above their MFN tariff rates
through August 31, 2019,23 with a simple average tariff rate increase of 24% across all products
as of July 2019. See Table A-1 for information on average Chinese retaliatory tariffs across
different food and agricultural product categories.
Retaliatory Tariffs by Canada and Mexico
In June 2018, Mexico levied a 15% tariff on U.S. sausage imports; a 20% tariff on other pork
products, certain cheeses, apples, potatoes, and cranberries; and a 25% tariff increase on whey,
blue-veined cheese, and whiskies.24

18 Note that the Chinese retaliatory tariffs discussed in this report covers those that were levied from April 2018
through June 2019. Additional retaliatory tariffs of 5% or 10% are effective September 1, 2019 on U.S. imports,
including 695 different U.S. agricultural tariff lines; and another 5% or 10% tariffs on U.S. imports will become
effective December 15, 2019, including 184 different U.S. agricultural tariff lines. For more see, USDA, FAS, “China
Announces Increases to Additional Tariffs,” GAIN Report Number:CH19051, August 28, 2019.
19 USDA, FAS, “China Responds to U.S. 301 Announcement with Revised Product List,” GAIN Report Number: CH
18034, June 21, 2018.
20 Ibid.
21 USDA, FAS, “China Implements Supplemental Imports Tariffs on U.S. Products Exported to China,” GAIN Report
Number: CH 18061, September 25, 2018.
22 USDA, FAS, “Revised: China Raises Tariffs on U.S. Agricultural Products,” GAIN Report Number: CH 19030, May
17, 2019.
23 Staring September 1, 2019, China will increase retaliatory tariffs on some agricultural products. See, Zumbrun, J.
“Latest Round in Trade War Set to Hit U.S. Vehicles, Agriculture,” Wall Street Journal, August 23, 2019.
24 USDA, FAS, “The Phasing In Of Mexican Retaliatory Tariffs,” GAIN Report Number: MX8028, July 11, 2018.
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Starting in July 2018, Canada imposed a retaliatory tariff of 10% on certain U.S. products
including: dairy, poultry and beef products; coffee, chocolate, sugar and confectionery; prepared
food products; condiments; bottled water; and whiskies.25
To facilitate the ratification of the proposed U.S.-Mexico-Canada Agreement (USMCA) that the
leaders of the three countries agreed to on September 30, 2018,26 the United States removed the
Section 232 tariffs on steel and aluminum imports from Canada and Mexico on May 17, 2019,
and, in turn, these countries removed their retaliatory tariffs on U.S. imports.27
Retaliatory Tariffs by the EU, Turkey and India
In June 2018, in response to U.S. Section 232 tariffs, the EU imposed a 25% tariff on imports of
U.S. corn, rice, sweetcorn, kidney beans, certain breakfast cereals, peanut butter, orange juice,
cranberry juice, whiskies, cigars, and other tobacco products, and a 10% tariff on certain essential
oils.28
In June 2018, Turkey also responded to U.S. Section 232 tariffs on Turkish steel imports by
levying retaliatory tariffs on selected U.S. imports.29 On August 10, 2018, the United States
doubled its tariffs on steel imports from Turkey to 50%, stating that the 25% tariffs did not reduce
Turkish steel imports as much as anticipated.30 Turkey responded by doubling tariffs on certain
U.S. imports including a 20% retaliatory tariff on U.S. tree nuts and certain prepared food, 25%
and 50% tariffs on U.S. rice (depending on whether milled or unmilled), 60% tariff on U.S.
tobacco, and 140% tariff on U.S. alcoholic beverages including whiskies.31 When the United
States reduced its tariffs on Turkish steel imports on May 21, 2019, Turkey halved its retaliatory
tariffs on U.S. imports.32
India identified certain U.S. food products for retaliatory tariffs in 2018 33 but did not levy them
until June 16, 2019. Indian tariff hikes above the MFN rate are 10% for imports of U.S.
chickpeas, 29% for over-quota shelled almonds (ad valorem rate), and 20% for U.S. walnuts,
apples, and lentils.

25 USDA, FAS, “Canada Announces Final List of Ag Products in Response to U.S. Tariffs,” GAIN Report Number:
CA18046, June 29, 2018.
26 For more information on this issue, see CRS Report R45661, Agricultural Provisions of the U.S.-Mexico-Canada
Agreement.
27 USTR, “United States Announces Deal with Canada and Mexico to Lift Retaliatory Tariffs,” Press Release, May 17,
2019.
28 USDA, FAS, “EU Imposes Additional Tariffs on U.S. Products,” GAIN Report Number: E18045, June 21, 2018.
29 USDA, FAS, “Turkey Introduces New Additional Levy on U.S. Products,” GAIN Report Number: TR8018, June 28,
2019.
30 White House, “Presidential Proclamation Adjusting Imports of Steel Into the United States,” August 10, 2018. For
more information, also see CRS In Focus IF10961, U.S.-Turkey Trade Relations.
31 USDA, FAS, “Turkey Announces Second Round of Additional Levies on U.S. Products,” GAIN Report Number:
TR8024, August 15, 2018.
32 USDA, FAS, “Turkey Reduces Additional Levies on U.S. Products,” GAIN Report Number: TR9012, May 22, 2019.
33 India, Immediate Notification Under Article 12.5 of the Agreement on Safeguards to the Council for Trade in Goods
of Proposed Suspension of Concessions and other Obligations Referred to in Paragraph 2 of Article 8 of the Agreement
on Safeguards, WTO, May 18, 2018.
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U.S. Agricultural Trade Affected by Tariff Hikes
Foreign nations may target U.S. food and agricultural products with retaliatory tariffs for several
reasons. First, the United States is the largest exporter of food and agricultural products, so many
countries are able to retaliate against those goods. Second, agricultural commodities are often
more easily substituted from among potential suppliers, so curbing imports from one country
would not necessarily limit an importing country’s access to the commodity. Third, several food
and agricultural products are produced primarily in certain regions of the United States, and thus
may be targeted with a view to negatively and disproportionately affecting the constituents of
specific U.S. lawmakers.
The retaliatory tariffs imposed by U.S. trading partners affected many products exported by the
United States including meats, grains, dairy products, specialty and horticultural crops, and
alcoholic beverages.34 As discussed in Box 3, “Tariffs Increase Import Prices,” a number of
factors affect trade, including tariffs that tend to increase the price of imported goods. In 2018,
total imports of affected U.S. food and agricultural products by all retaliating countries amounted
to almost $22 billion, based on customs data from these countries. This represents a 27% decline
from the $29.7 billion in 2017 (Figure 1).35
Box 3. Tariffs Increase Import Prices
Economic principles state that comparative advantage, based on available resources, enable some countries to
produce an exportable surplus of certain goods while other countries may have a deficit in these same goods but
may produce an exportable surplus of other goods. A nation may choose whether to import a good in which it
has a deficit, based on the differential between the import price and the cost of producing the good domestically.
Thus, the decision whether to import from a certain trading partner or produce the good domestically hinges on
the relative prices of imported versus domestically produced goods.
In a dynamic international market, a number of factors determine agricultural commodity prices. These include,
for example, the existing level of stocks for a given commodity, annual production levels, the anticipated demand
for both the commodity and potential substitutes, prices of substitutes, and exchange rates. Trade policy is
another important factor. Trade barriers such as tariffs raise the price of an imported product, which in turn may
lower the demand for certain products in the importing country. If new tariffs target imports from a particular
supplier, imports from other suppliers become cheaper relative to imports from the country with higher tariffs.
For more on this topic, see Houck, J. P., Elements of Agricultural Trade Policies, 1992, Waveland Press Inc,
Prospect Heights, Il inois.
Based on Chinese customs data, the total value of Chinese agricultural imports from the United
States affected by retaliatory tariffs declined from $22.5 billion in 2017 to $14.7 billion in 2018.36
Canadian customs data show that imports of U.S. agricultural products declined to $2.3 billion in
2018 from $2.4 billion in 2017.37 Canadian retaliatory tariffs include certain tariff lines covering
prepared product categories under beef, poultry, dairy, fruit, vegetables, drinks, coffee and spices,
chocolate and confectionary, and whiskey. As noted earlier, Canada removed its retaliatory tariffs
on U.S. imports in May 2019, in response to the U.S. removal of Section 232 tariffs on steel and
aluminum imports from Canada.

34 China has also imposed retaliatory tariffs, ranging between 5%-25%, on U.S. fishery and forestry products. U.S.
fishery and forestry exports are not covered in this report.
35 All trade statistics in this reported are provided on a calendar-year basis, January-December.
36 China Customs Statistics, http://english.customs.gov.cn/Statistics/Statistics?ColumnId=7.
37 Government of Canada, Statistics Canada, https://www.ic.gc.ca/eic/site/tdo-dcd.nsf/eng/Home.
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A review of Mexican customs data finds that imports of U.S. agricultural products by Mexico
also declined from $2.6 billion in 2017 to $2.5 billion in 2018,38 largely accounted by sausage and
pork products. Mexico’s imports of these products declined from $2.3 billion in 2017 to $1.6
billion in 2018. In addition to pork products, Mexico had imposed retaliatory tariffs on cheeses,
apples, prepared fruit, vegetables and other food, and whiskey. Mexico also removed its
retaliatory tariffs on U.S. imports in May 2019, in response to U.S. removal of Section 232 tariffs
on steel and aluminum imports from Mexico.
Figure 1. Imports of U.S. Agricultural Products Affected by Retaliatory Tariffs
Trading Partner Reporting, In Billions (B) of U.S. Dollars

Source: CRS, based on customs data of importing countries, values rounded to the first decimal place.
Notes: India did not implement retaliatory tariffs in 2018. They became effective June 2019.
EU customs data show the import value of U.S. food and agricultural products affected by the EU
retaliatory tariffs increased to $1.3 billion in 2018 from $1.1 billion in 2017.39 The EU imposed
tariff hikes on certain prepared vegetables, pulses, breakfast cereals, fruit juices, peanut butter,
tobacco products, whiskey, and essential oils. A temporary surge in sales in the months prior to
the imposition of duties appears to have offset a slump in sales that coincided with the onset of
retaliatory duties later in the year (Figure 2). Based on the quarterly import data, by the first
quarter of 2019, the total value of EU imports of U.S. products affected by retaliatory tariffs was
lower than during the last quarter of 2017 or the first quarter of 2018. Since the second quarter of
2018, EU imports of affected food and agricultural products from the United States declined. As
discussed above, beyond the tariff increases, a number of factors may have contributed to this
reduction in imports. For instance, when countries first released their proposed lists of products
that they targeted for retaliation, some EU importers may have imported larger quantities of the
affected products prior to the imposition of the duties, thus boosting EU imports of U.S.
agricultural goods in 2018.

38 Data from Mexico National Institute of Statistics.
39 Data from EuroStat, https://ec.europa.eu/eurostat/data/database.
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Similar to the EU, the total value of Turkish
imports of U.S. food and agricultural products
Figure 2. EU and Turkey Imports of U.S.
affected by retaliatory tariffs increased
Products Subject To Retaliatory Tariffs
between 2017 ($299 million) and 2018 ($316
Quarterly Imports, In Millions of U.S. Dollars
million), based on Turkish customs data.40
Turkey had imposed tariff hikes on certain
tree nuts, prepared food, rice, tobacco,
whiskey, and other alcoholic beverages.
Imports in the months prior to the imposition
of duties had increased (Figure 2), which
may have offset the decline in imports during
the second half of 2018. In the third and
fourth quarter of 2018, Turkish imports of
affected U.S. food and agricultural products
declined. Since May 2019, Turkey halved its
retaliatory tariffs on imports from the United
States.41

During 2018, India did not levy any
Source: Eurostat and Turkish State Institute of
retaliatory tariffs on imports of U.S. food and
Statistics, accessed via Global Trade Atlas, July 1,
agricultural products. Starting in June 16,
2019.
2019, India implemented retaliatory tariffs on

imports of U.S. almonds, walnuts, chickpeas,
lentils, and apples.42 Based on the Indian customs data, the total value of Indian imports of these
products was $824 million in 2017 and $859 million in 2018.43
U.S. Agricultural Exports to Retaliating Countries
Table 2 presents U.S. agricultural exports to retaliating and non-retaliating countries, in nominal
values, from 2014 to 2018. As discussed in Box 1, U.S. exports to trading partners and the
reported import values in destination countries can differ due to differences in HS classification
of goods in different countries. Canada, EU, Mexico, and Turkey levied retaliatory tariffs in 2018
on selected U.S. agricultural products, while China imposed retaliatory tariffs on almost all U.S.
food and agricultural products. During 2018, India did not levy any retaliatory tariffs. Thus, the
changes in 2018 U.S. food and agricultural exports, compared to prior years, varied across these
countries (Table 2).
Despite the retaliatory tariffs, U.S. agricultural exports grew from $138 billion in 2017 to $140
billion in 2018. Greater U.S. exports of products to non-retaliating countries ($76 billion in 2018,
up from $66 billion in 2017) offset the value of trade lost to China and Turkey. In addition,
increased U.S. exports of products without retaliatory tariffs and products targeted for retaliatory

40 Data from Turkey Statistical Institute, http://www.turkstat.gov.tr/Start.do.
41 USDA, FAS, “Turkey Reduces Additional Levies on U.S. Products,” GAIN Report Number: TR9012, May 22, 2019.
42 The Government of India, The Gazette of India, Part II, Section 3, Number 357, Customs Notification No. 16/2019,
June 15, 2019.
43 Government of India, Department of Commerce, Export Import Data Bank, https://commerce-
app.gov.in/eidb/icomq.asp.
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tariffs during the months prior to their implementation (to Canada, Mexico, and the EU) also
helped to offset the decline in exports of products with retaliatory tariffs to these countries.44
Table 2. U.S. Agricultural Exports to Retaliating and Non-Retaliating Countries
In Nominal Billions of U.S. Dollars, 2014 to 2018
2018-2017
2014
2015
2016
2017
2018
% change

Total U.S. Global Agricultural Exports
150
133
135
138
140
1%
U.S. Exports to Countries With Retaliatory Tariffs in 2018
Canada
22
21
20
21
21
1%
Mexico
19
18
18
19
19
3%
European Union
13
12
12
11
14
18%
China
24
20
21
19
9
-53%
Turkey
2
1
1
2
1
-19%
U.S. Exports to Countries Without Retaliatory Tariffs in 2018
Other Countries
70
61
63
66
76
15%
Source: U.S. Census Bureau Trade Data, accessed August 2019.
Notes: Data are provided in calendar years. As India did not levy any retaliatory tariffs during 2018, it is
excluded from the list of countries with retaliatory tariffs in 2018. USDA’s definition of agriculture is used in the
table, which include products in Chapters 1-24 of the U.S. Harmonized Tariff Schedule (except for fishery
products in Chapters 3 and 16, manufactured tobacco products like cigarettes and cigars in Chapter 24, and
spirits in Chapter 22), essential oils (Chapter 33), raw rubber (Chapter 40), raw animal hides and skins (Chapter
41), and wool and cotton (Chapters 51-52).
Trade data for 2017 and 2018 in Table 2 differ from those presented in Figure 1, which only includes HS lines
subject to retaliatory tariffs. Data in Table 2 also does not include alcoholic beverages that were subject to tariff
hikes by all retaliatory countries, potentially understating the decline in U.S. exports to retaliating countries in
2018.
U.S. Exports under Chinese Retaliatory Tariffs45
The Chinese market is important for several U.S. agricultural products. For example, in 2016 and
2017, the United States supplied over a third of China’s total soybean imports, almost all of
China’s distillers’ grain imports (primarily used as animal feed), and most of China’s sorghum
imports.46 In 2017, the Chinese market accounted for about 57% of global U.S. soybean exports,
17% of global U.S. cotton exports, 80% of global U.S. sorghum exports, 11% of global U.S. dairy
product exports, 10% of global U.S. pork exports, 6% of global U.S. wheat exports, and 5% of
global U.S. fruit exports.
In response to U.S. Section 232 and Section 301 tariffs on U.S. imports of Chinese goods
imposed in 2018, China levied retaliatory tariffs on imports of almost all U.S. agricultural
products. In 2017, China was the second-leading export market by value for U.S. agricultural

44 The data in Table 2 does not include alcoholic beverages, inclusion of which could alter the percentage change in
U.S. exports between 2017 and 2018 to the retaliatory countries.
45 All U.S. agricultural export data discussed in this section are from the U.S. Census Trade Data.
46 Chinese customs data, accessed via Global Trade Atlas, August 2019.
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products. However, after the imposition of retaliatory tariffs on U.S. imports beginning in April
2018, U.S. agricultural exports to China experienced a 53% decline from $19.5 billion in 2017 to
$9.2 billion in 2018 (Figure 3).47 China thus moved down in rank to become the fourth largest
U.S. agricultural market, after Canada, Mexico, and Japan.
Figure 3. U.S. Agricultural Exports to China, 2014 to 2018
In Nominal Billions of U.S. Dollars

Source: U.S. Census Bureau Trade Data, accessed June 17, 2019.
Notes: Data are provided in calendar years.
Among other goods, China imposed a 25% retaliatory tariff on U.S. soybeans in July 2018. Since
2000, China had been the top export market for U.S. soybeans. In 2017, China imported about
$12 billion worth of U.S. soybeans, accounting for 57% of the total value of all U.S. soybean
exports that year. With higher tariffs in place, China has been purchasing more soybeans from
Brazil and other countries to meet its demand.48 Consequently, U.S. soybean exports to China in
2018 declined to $3 billion (Figure 3). U.S. Census trade data indicate China was still the top
foreign destination for U.S. soybeans in 2018, followed by Mexico which imported $1.8 billion of
U.S. soybeans.
Reduced Chinese import demand in 2018 contributed to declining farm prices for affected
commodities and lower U.S. agricultural exports to China for several commodities, including
sorghum, soybeans, cotton, and pork.49 Consequently, U.S. soybean prices reached 10-year lows
during July-October 2018 (Figure 4), weighing on prices of other agricultural commodities such

47 U.S. Census Bureau Trade data, accessed June 5, 2019, at https://apps.fas.usda.gov/gats/default.aspx.
48 K. Plume, “U.S. Soybean Exports Scrapped as China Shifts to Brazilian Beans,” Reuters, May 18, 2018.
49 Marchant, M.A., and H.H. Wang, 2018, "Theme Overview: U.S.–China Trade Dispute and Potential Impacts on
Agriculture," Choices, Quarter 2, http://www.choicesmagazine.org/choices-magazine/theme-articles/us-china-trade-
dispute-and-potential-impacts-to-agriculture/theme-overview-uschina-trade-dispute-and-potential-impacts-on-
agriculture.
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as corn that competes with soybeans for acreage.50 Prices recovered some during the last quarter
of 2018, coincident with reported commitments by China to purchase a “very substantial amount
of U.S. agricultural” goods.51 However, Chinese purchases failed to materialize and U.S.
commodity prices resumed their downward trend through the first quarter of 2019 before
stabilizing.
Figure 4. U.S. and Brazilian Soybean Free on Board (FOB) Prices
In U.S. Dollars Per Metric Ton, Since January 1, 2018

Source: International Grains Council (IGC), July 2019.
Notes: The U.S. Gulf covers the East Gulf, the Mississippi River, and North and South Texas. Free on Board
(FOB) prices include the delivery cost of the product to export port and loading onto the ship.
As U.S. soybean prices declined in 2018, Brazilian soybean prices started to rise, indicative of a
greater demand for Brazilian soybeans from China (Figure 4).52 Since 2007, Brazilian and U.S.
soybean prices had tended to move together.53 Starting in April 2018, U.S. soybean prices started
to fall and Brazilian soybean prices started to rise. China’s imposition of a 25% tariff on U.S.
soybeans in July 2018 initially precipitated a widening of the gap between the two prices. On
October 23, 2018, U.S. soybean Free on Board (FOB) prices were $86 per metric ton lower than
Brazilian (Paranaguá) FOB prices.54

50 Zhou et al., “Evaluating Potential Long-Run Impacts of Chinese Tariff on U.S. Soybeans,” Farmdoc Daily, (8):79,
September 26, 2018.
51 White House, “Statement from the Press Secretary Regarding the President’s Working Dinner with China,” Press
Release, December 1, 2018.
52 Ibid.
53 Gale et al., “Interdependence of China, United States, and Brazil in Soybean Trade,” OCS-19F-01, Figure 19, page
32, USDA, ERS, June 2019.
54 Free on Board (FOB) prices include the cost of getting the good to the nearest port and loading onto the ship.
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Table 3. Selected U.S. Agricultural Exports to China, 2014-2018
In Nominal Millions of U.S. Dollars
Product
2014
2015
2016
2017
2018 2018-2017
% change
Total Agricultural Productsa
24,219 20,230 21,394 19,507
9,186
-53%
Soybeans
14,476 10,489 14,203 12,253
3,145
-74%
Cotton
1,111
859
554
978
924
-6%
Sorghum
1,466
2,115
1,030
839
530
-37%
Tobacco
216
197
172
162
158
-3%
Wheat
194
160
205
351
105
-70%
Corn
84
163
40
142
50
-65%
Pulses
29
24
26
25
11
-56%
Oilseeds (excluding soybean)
5
2
3
5
1
-81%
Pork & Pork Products
474
427
713
662
571
-14%
Dairy Products
695
451
386
577
500
-13%
Fresh Fruit
102
137
186
226
177
-22%
Processed Fruit
69
95
100
134
116
-14%
Wine & Beer
80
63
91
86
68
-21%
Breakfast Cereals
11
29
32
30
21
-29%
Hides & Skins
1,497
1,268
948
945
607
-36%
Hay
255
331
355
341
274
-19%
Feeds & Fodders, not elsewhere otherwise indicated
366
377
379
267
232
-13%
Distil ers Grains
1,247
1,632
470
62
44
-29%
Soybean Oil
132
13
104
24
2
-93%
Source: U.S. Census Bureau Trade Data, Product Group BICO-HS10, accessed June 17, 2019,
https://apps.fas.usda.gov/gats/default.aspx.
Notes: Products are selected for il ustrative purpose based on the value of U.S. exports or the percentage
change in trade between 2017 and 2018. The table is not comprehensive. Data are provided in calendar years,
January through December. The table does not cover almost 700 food and agricultural HS lines with retaliatory
tariffs in place since April 2018, nor does it cover over 200 fishery and seafood product HS lines and about 100
forest products HS lines. Note that while fishery and seafood products and forest products are eligible for
USDA’s export promotion programs, both the USDA and the WTO do not define seafood and forest products
as agricultural products.
a. Total reported U.S. agricultural exports to China may not match with Chinese reported U.S. agricultural
imports. The reasons for possible discrepancies are explained in Box 4 ‘Differences in Comparing U.S.
Exports Data with Chinese Imports Data’.
The Brazilian soybean price started to fall in late October in anticipation of a record-high South
American soybean harvest. U.S. soybean prices started to climb at the same time, partly due to
farmers’ willingness to hold stocks and in response to larger exports to non-Chinese
destinations.55 Anticipation of Chinese purchases also contributed to rebounding of U.S. prices.

55 Gale et al., “Interdependence of China, United States, and Brazil in Soybean Trade,” OCS-19F-01, USDA, ERS,
June 2019.
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As Chinese purchases did not materialize, Brazilian and U.S. soybean prices started to diverge
again in May 2019.
Although soybeans has been the agricultural commodity most affected by retaliatory tariffs,
(largely due to China’s dominant role in the global soybean market) nearly all U.S. agricultural
exports to China declined in 2018 relative to 2017 (Table 3).
Key Competitors for China’s Agricultural Market56
Box 4. Differences in Comparing U.S. Exports Data with Chinese Imports Data
Among others, the fol owing factors contribute to differences between U.S. exports data and Chinese imports
data.

Global Harmonized System (HS) codes are standardized up to the 6-digit level. China’s retaliatory tariffs are
implemented at the 8-digit level and do not always match with U.S. Harmonized Tariff Schedule (HTS) codes.

Time required for transportation—for example, shipped in one month but unloaded the fol owing month—
can partly contribute to the difference between reported trade data for U.S. exports to China and China’s
imports from the United States.

China and the United States use different definitions for their trade data. China reports exports using the
term "free on board" (F.O.B.) which includes the cost of getting the goods to port and loading onto the ship;
and reports imports using "cost, insurance, and freight" (C.I.F.) term. The use of F.O.B. for exports and C.I.F.
for imports is a common, but not universal, international practice. The United Nations Department of
Economic and Social Affairs Statistics Division, for example, recommends this practice. The United States
reports its exports using "free alongside ship" (F.A.S.) term. The F.A.S. value does not include the costs of
clearing the goods for export and loading the goods. The United States reports imports using a customs
definition which includes the actual cost of the goods and do not include the cost of insurance and freight.
For more on this issue see, CRS Report RS22640, What’s the Difference?—Comparing U.S. and Chinese Trade Data.
With retaliatory tariffs making U.S. agricultural products more expensive for Chinese buyers,
exports from other countries to China increased during 2018. Some studies suggest that Brazil
could become China’s primary soybean supplier.57 Another study concludes that U.S.-China tariff
escalation would make suppliers in the rest of the world more competitive relative to U.S. and
Chinese suppliers.58 Russia also contends that it may become a major U.S. competitor for China’s
agricultural import market,59 although market watchers expect Russia will need years to become a
major agricultural supplier to China.60 To explore these assertions, CRS examined Chinese import
data to identify foreign sources that may have partially replaced some of the 2018 U.S.

56 The data discussed in this section are China Customs Data accessed from Global Trade Atlas, July 2019.
57 Gale et al., “Interdependence of China, United States, and Brazil in Soybean Trade,” OCS-19F-01, USDA, ERS,
June 2019; and Fuchs et al, “U.S.-China Trade War Imperils Amazon Rainforest,” Nature, Vol. 567 March 28, 2019,
pp. 451-454.
58 United Nations Conference on Trade and Development (UNCTAD), Key Statistics and Trends in Trade Policy,
2018, https://news.un.org/en/story/2019/02/1031921; Fuchs et al., “U.S.-China Trade War Imperils Amazon
Rainforest,” Nature, Vol. 567, pp. 451-454.
59 F. Bermingham, “China and Russia Vow To 'Deepen Trade In Soybeans' After Tariff War Kills U.S. Crop Exports,”
South China Morning Post, July 18, 2019; S. Zheng, “Russia offers 2.5 million acres of land to Chinese farmers, but
will it ease Beijing’s soybean shortage?” South China Morning Post, August 15, 2018; RT, “Russia to double global
food exports, ready to replace US agricultural products in China,” June 7, 2019; A. Medetsky and M, Durisin, “China
Turns to Russia in Search to Replace U.S. Soybeans,” Bloomberg, November 7, 2018.
60 Kitanaka, A. and J. Rogers “Russia Can’t Satisfy China’s Soybean Needs Amid U.S. Trade War,” Bloomberg News,
August 19, 2019; and Rappeport, A. and K, Bradsher, “As U.S, China Trade War Escalates, American Farm Goods are
Targeted Again,” Farm Policy News, August 25, 2019.
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agricultural exports to China. Note that various factors can result in data differences between U.S.
exports from U.S. Census Bureau and imports from Chinese customs data (Box 4).61
China’s Total Annual Agricultural Imports
Figure 5. China’s Imports of Agricultural Products, 2014 to 2018
In Nominal Billions (B) of U.S. Dollars

Source: Chinese customs data accessed from Global Trade Atlas, July 2019.
Notes: The chart uses World Trade Organization’s definition of agriculture. Import values are not adjusted for
inflation.
According to Chinese customs data, China’s imports of agricultural products were $117 billion in
2014 as compared to $127 billion in 2018, in nominal terms (Figure 5). In 2014, the United
States was the largest source of Chinese agricultural imports accounting for nearly a quarter, or
$28 billion, of China’s total imports. Since 2017, Brazil and several other countries increased
their shares of China’s total imports, with Brazil overtaking the United States as China’s largest
agricultural supplier in 2017. Since the imposition of the retaliatory tariffs on U.S. imports in
2018, U.S. agricultural shipments to China declined to $15 billion compared to $23 billion in
2017 even as overall Chinese imports increased to $127 billion. It is noteworthy that in 2016,
when China’s total agricultural imports was at the lowest point between 2014 and 2018, at $105
billion, U.S. market share was 21% compared with 2018, when China’s total agricultural imports
were at $127 billion but U.S. market share was 12%. During the same period, Brazil’s market
share grew from 18% in 2016 to 26% in 2018. Additionally, China’s imports from other countries
increased as indicated in Figure 5.
Brazil appears to be the primary beneficiary of Chinese retaliatory tariffs on U.S. imports, with
increased exports to China in 2018 of soybeans, cotton, tobacco, pork, and oilseeds. Australia also
registered growth in import market shares for cotton, sorghum, pulses, fruit and nuts, dairy, and
hides and skins. Canada increased its exports to China of feed and fodder products, hides and

61 U.S. Census trade data provide U.S. exports to and imports from other countries, but data on China’s trade with
countries other than the United States are available from Chinese customs data. For more on this issue, see CRS Report
RS22640, What’s the Difference?—Comparing U.S. and Chinese Trade Data.
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Retaliatory Tariffs and U.S. Agriculture

skins, and wheat. New Zealand’s share of China’s import market saw gains in dairy, and hides
and skins. Thailand increased its export shipments of fruit, nuts and starches, and malt to China,
while increased shipments from Indonesia were largely fats and oils.
Additionally, Russia has stated that it is ready to step in to fill in the gaps created by reductions in
U.S. food and agricultural exports to China, according to various news media reports,62 although
market watchers expect Russia will need years to become a major agricultural supplier to China.63
In July 2018, Chinese Commerce Minister Zhong Shan agreed with his Russian counterparts to
"deepen trade in soybeans and other agricultural products."64 China’s imports of food and
agricultural products from Russia increased 61%, from $679 million to nearly $1.1 billion,
between 2017 and 2018, with strong import growth in oilseeds, wheat, fats and oils, cocoa and
related products, beer, and animal products.
Various other countries from Central Asia, South and Southeast Asia, and Africa increased their
exports of food and agricultural products to China during 2018 compared with 2017. Notably
China’s wheat imports from Kazakhstan grew 34% and corn imports from Ukraine rose 20%.
U.S. agricultural interests have reported concerns that the U.S.-China trade war in the form of
tariffs and tariff retaliation could escalate further, potentially resulting in widespread, long-term
damage, particularly for firms with complex international supply chains.65 For American farmers,
the escalating conflict with China has contributed to declining soybean and related agricultural
commodity prices in the short-run, but studies indicate that the long-term consequences could be
complex and have long lasting impacts.66
The following section examines how major U.S. agricultural product market shares fared in the
Chinese import market during 2018. It also presents China’s imports of selected agricultural
commodities on a monthly basis starting in January 2018, through the first trimester of 2019
when the different retaliatory tariffs became effective.

62 For example, T. Grove and Kurmanaev, A., “A Surprise Winner From the U.S.-China Trade Spat: Russian Soybean
farmers,” Wall Street Journal, February 21, 2019; S. Zheng, “Russia offers 2.5 million acres of land to Chinese
farmers, but will it ease Beijing’s soybean shortage?” South China Morning Post, August 15, 2018; RT, “Russia To
Double Global Food Exports, Ready To Replace US Agricultural Products In China,” June 7, 2019.
63 Kitanaka, A. and J. Rogers “Russia Can’t Satisfy China’s Soybean Needs Amid U.S. Trade War,” Bloomberg News,
August 19, 2019; and Rappeport, A. and K, Bradsher, “As U.S, China Trade War Escalates, American Farm Goods are
Targeted Again,” Farm Policy News, August 25, 2019.
64 F. Bermingham, “China and Russia Vow To 'Deepen Trade In Soybeans' After Tariff War Kills U.S. Crop Exports,”
South China Morning Post, July 18, 2019.
65 Zhou et al., “Dispatches from the Trade Wars,” Farmdoc Daily, (8):162, August 29, 2018.
66 For example, Gale et al, Interdependence of China, United States, and Brazil in Soybean Trade, OCS-19F-01,
USDA, ERS, June 2019; Zheng et al.,“Predicting Potential Impacts of China’s Retaliatory Tariffs on the U.S. Farm
Sector,” Choices, Quarter 2, 2018; http://www.choicesmagazine.org/choices-magazine/theme-articles/us-china-trade-
dispute-and-potential-impacts-to-agriculture/predicting-potential-impacts-of-chinas-retaliatory-tariffs-on-the-us-farm-
sector; Ribera et al., “Estimated Economic Impacts of Retaliatory Tariffs by China and Mexico on U.S. Dairy
Products,” CNAS Report 2018-3, September 2018; http://cnas.tamu.edu/; Balistreri et al., “The Impact of the 2018
Trade Disruptions on the Iowa Economy,” CARD Policy Briefs, 18-PB 25, CARD, Iowa State University, September
2018, https://www.card.iastate.edu/products/publications/synopsis/?p=1281; Rempe, Jay, Whittney Kelley, and Oscar
Díaz, “Nebraska Agriculture & International Trade,” Nebraska Farm Bureau, December 3, 2018,
https://www.nefb.org/; and Sumner, D. A. and T. M. Hanon, “Economic Impacts of Increased Tariffs that have
Reduced Import Access for U.S. Fruit and Tree Nuts Exports to Important Markets,” University of California
Agricultural Issues Center and Department of Agricultural and Resource Economics, UC Davis, August 1, 2018,
https://aic.ucdavis.edu/2018/08/08/new-tariffs-tax-economic-prospects-of-tree-nut-and-fruit-industries.
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China’s Imports of Soybeans
According to U.S. Census data, China has been the top export market for U.S. soybeans since
2000. China imported $12 billion worth (32 million metric tons) of U.S. soybeans in 2017,
accounting for 57% of the total value and volume of all U.S. soybean exports that year. With
higher tariffs on U.S. soybeans, China has been purchasing more soybeans from Brazil and other
countries to meet its demand.67 Consequently, U.S. soybean exports to China declined to $3
billion (8 million metric tons) in 2018. Based on U.S. Census trade data, China was still the top
destination for U.S. soybeans in 2018, followed by Mexico—which imported $1.8 billion worth
of U.S. soybeans.
Figure 6. China’ Monthly Imports of Soybeans,
In Millions of U.S. Dollars, January 2018 to May 2019

Source: China Customs Data accessed from Global Trade Atlas, July 2019.
Notes: ‘Round 3 U.S. Section 301 tariffs’ implemented in September 2018, increased existing 301 tariffs to 25%.
Other major sources of China’s soybean imports include Argentina, Uruguay, Canada and Russia.
According to China’s monthly customs data, China’s import of U.S. soybeans in January 2018
was $2.5 billion (Figure 6).68 China’s monthly imports of U.S. soybeans started to decline after
China announced retaliatory tariffs in response to U.S. Section 232 tariffs in April 2018, which
did not include U.S. soybeans. By the time China imposed retaliatory tariffs in response to U.S.
Section 301 tariffs (which included U.S. soybeans) in July 2018, China’s import of U.S. soybeans
had decreased to about $140 million for that month (from $2.5 billion in January 2018). U.S.

67 K. Plume, “U.S. Soybean Exports Scrapped as China Shifts to Brazilian Beans,” Reuters, May 18, 2018; and Gale et
al, Interdependence of China, United States, and Brazil in Soybean Trade, OCS-19F-01, USDA, ERS, June 2019.
68 As discussed in Box 4, U.S agricultural exports data reported by the U.S. Census Bureau and China’s imports of U.S.
agricultural products reported by Chinese customs data do not generally match. For example, total U.S. soybean
exports to China in 2018 were $3 billion based on U.S. Census trade data, which is lower than the total Chinese
soybean imports of $7 billion based on Chinese customs data. Note that the Chinese customs data reports $2 billion
($5.7 billion) less imports for the period September to December 2017 than reported in U.S. exports by the U.S. Census
data ($7.7 billion). This difference could partly be the result of shipments that had not yet reached China, and partly
because the two countries value shipments differently as explained in Box 4.
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soybean shipments to China continued to decline until November 2018 when China did not
import any U.S. soybeans. In December 2018, the White House announced that China had
committed to purchase a “very substantial amount of agricultural” goods. Following this and
other announcements, China purchased U.S. soybeans during the first trimester of 2019. The
largest of these purchases, worth $700 million, occurred in April 2019. However, China’s imports
of U.S. soybeans declined in May 2019, coincident with the continued escalation of the U.S.-
China trade dispute and the imposition of an increase in the third round of U.S. Section 301 tariffs
on Chinese imports in May 2019.
During this tariff dispute, China has turned increasingly to Brazil to meet its demand for
soybeans. In January 2018—prior to the tariff dispute—Chinese imports of Brazilian soybeans
totaled less than $900 million, before increasing in May and June of 2018 when shipments of
newly harvested soybeans from the Southern Hemisphere to China increased. By July 2018,
Brazilian shipments were on the decline when China imposed 25% retaliatory tariffs on U.S.
soybeans. Normally, newly harvested U.S. soybean shipments to China would have increased in
the fall of 2018, whereas Chinese purchases of U.S. soybeans, slowed to almost nil, and were
outpaced by Brazilian shipments to China. From February to May 2019, China expanded its
purchases of U.S. soybeans, while also buying soybeans from Brazil, and increasing its soybean
imports from Argentina, Russia and Central Asian countries.
China’s Imports of Cotton
According to U.S. Census trade data, U.S. cotton exports to China totaled over $1 billion in
2014.69 From 2017 to 2018, U.S. cotton exports to China declined 6% from $978 million to $924
million.
Monthly Chinese customs data indicate that China’s imports of U.S. cotton has decreased since
the imposition of retaliatory tariffs in July 2018 (Figure 7). During January 2018, China’s cotton
imports from the United States totaled $140 million. Following the announcement of retaliatory
tariffs on some U.S. imports (in response to U.S. Section 232 action) in April 2018, China’s
imports of U.S. cotton shrank to $27 million in October 2018. While Chinese imports from the
United States declined, China’s imports from other countries have increased. Cotton shipments
from Brazil and Australia posted the largest increases, followed by imports from India and
Uzbekistan. Additionally China’s imports of cotton from other Central Asian and West African
countries have risen since June 2018 (Figure 7). On July 26, 2019, China reportedly approved
some domestic textile mills to buy 50,000 metric tons of U.S. cotton without being subject to
retaliatory tariffs.70 However, since President Trump’s announcement to levy 10% Section 301
tariffs on the remaining Chinese imports that were not subject to Section 301 tariffs, China
responded in August 2019 by asking its state-owned enterprises to halt purchases of U.S.
agricultural goods.71

69 In nominal, inflation un-adjusted, dollars. Based on U.S. Census trade data.
70 Bloomberg News, “China Allows Some Tariff-Free U.S. Cotton, Pork Purchases,” July 26, 2019.
71 Yang, Y. and A. Zang, “China Tells Companies to Stop Buying U.S. Agricultural Goods,” Financial Times, August
5, 2019.
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Figure 7. China’s Monthly Imports of Cotton
In Millions of U.S. Dollars, Since January 2018

Source: China Customs Data accessed from Global Trade Atlas, July 2019.
China’s Imports of Wheat
In 2016, the United States supplied 26% of China’s wheat imports. This share increased to 40%
in 2017, but declined to 14% in 2018. Canadian wheat exports have largely replaced U.S. wheat
shipments to the Chinese market with Canada’s share of China’s wheat imports rising from 27%
in 2016 to 54% in 2018. Kazakhstan and Russia also have increased their wheat exports to China
in the wake of 25% Chinese retaliatory tariffs on U.S. wheat imports, which has been in effect
since July 2018.
From January to June 2018, the United States shipped a total of $113 million of wheat to China
(Figure 8), compared with $256 million of U.S. wheat shipped during the same period in 2017.72
After China levied retaliatory tariffs on U.S. wheat in July 2018, U.S. wheat shipments to China
were nil for the rest of the year. China imported $208 million of U.S. wheat in 2016 and $390
million of U.S. wheat in 2017.73 In March 2019, China imported $12 million of U.S. wheat.
According to Chinese customs data, there have been no additional U.S. wheat shipments to China
as of May 2019.

72 CRS calculation using Chinese customs data accessed via Global Trade Atlas, August 2019.
73 Chinese customs data accessed via Global Trade Atlas, August 2019.
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Figure 8. China’s Monthly Wheat Imports
In Millions of U.S. Dollars, Since January 2018

Source: China Customs Data accessed from Global Trade Atlas, July 2019.
Notes: France is the main wheat supplier in the “Others” category.
China’s Imports of Sorghum
The United States accounted for nearly 90% of China’s total sorghum imports in 2016 and
2017.74 The value of U.S. shipments of sorghum declined 24% from close to $1 billion in 2017 to
$726 million in 2018. China’s monthly imports of U.S. sorghum have been negligible since China
implemented retaliatory tariffs on them in July 2018 (Figure 9). U.S. imports started to decline
after May 2018, following China’s imposition of retaliatory tariffs on some agricultural products
in response to U.S. Section 232 tariffs in April 2018.75 Later, China imposed a 25% retaliatory
tariff on U.S. sorghum in July 2018, leading to declines in U.S. sorghum shipments to China.
China’s imports of U.S. sorghum declined after retaliatory tariffs were imposed, but China
continued to import limited quantities from Australia, Myanmar and Argentina. However, in the
absence of Chinese purchases of U.S. sorghum, China’s total sorghum imports since October
2018 have been negligible (Figure 9). Therefore, despite the retaliatory tariffs, U.S. market share
in 2018 was about 85% of China’s total sorghum imports for the year.

74 Ibid.
75 Note, the lag in decline in Chinese imports staring in June 2018 could be the result of shipments that were already
underway when China announced its retaliatory tariffs in response to U.S. Section 232 tariffs in April 2018.
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Figure 9. China’s Monthly Sorghum Imports
In Millions of U.S. Dollars, Since January 2018

Source: China Customs Data accessed from Global Trade Atlas, July 2019.
Notes: Argentina is the “Other” supplier, which exported very small quantities of sorghum to China.
On July 26, 2019, China reportedly allowed several domestic companies to buy U.S. sorghum
without being subject to retaliatory tariffs.76 However, since President Trump’s announcement to
levy 10% Section 301 tariffs on remaining Chinese imports that do not yet have any Section 301
tariffs imposed on them, China responded in August 2019 by asking its state-owned enterprises to
halt purchases of U.S. agricultural goods.77
China’s Imports of Pork and Pork Products
The United States supplied 13% of China’s total pork imports in 2016 ($400 million) and 2017
($286 million).78 In 2018, U.S. pork shipments to China declined to $130 million and accounted
for 6% of China’s total pork imports. U.S. pork shipments to China began to decline in April
2018 following China’s imposition of 25% retaliatory tariffs on U.S. pork (HS 0203 lines) in
response to U.S. Section 232 tariffs on U.S. imports of Chinese steel and aluminum products
(Figure 10). In July 2018, these HS lines were subject to an additional 25% retaliatory tariff. This
coincided with a further decline in Chinese imports of U.S. pork products from July through
December 2018.

76 Bloomberg News, “China Allows Some Tariff-Free U.S. Cotton, Pork Purchases,” July 26, 2019.
77 Yang, Y. and A. Zang, “China Tells Companies to Stop Buying U.S. Agricultural Goods,” Financial Times, August
5, 2019.
78 USDA’s definition of pork includes HS codes 020311, 020312, 020319, 020321, 020322, 020329, 021011, 021012,
021019, 160241, 160242, and 160249.
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Figure 10. China’s Monthly Imports of U.S. Pork
In Millions of U.S. Dollars, Since January 2018

Source: China Customs Data accessed from Global Trade Atlas, July 2019.
Notes: USDA’s definition of pork includes HS codes 020311, 020312, 020319, 020321, 020322, 020329,
021011, 021012, 021019, 160241, 160242, and 160249.
Unlike the case of sorghum, China has continued to import some U.S. pork products, and import
volumes generally increased from January through May 2019. Since the summer of 2018, China
has suffered from a serious outbreak of African Swine Fever (ASF).79 Between September 2018
and May 2019, China reported over 2 million culled hogs. In March 2019, USDA reported that
despite the retaliatory tariffs, because of ASF, U.S. pork products are entering China and USDA
expects China's imports of U.S. pork to climb in 2019 due to the liquidation of some of China's
hogs in an effort to control ASF. However, USDA reported that U.S. pork products still face
Chinese retaliatory tariffs, which makes U.S. products relatively more expensive compared with
pork from other countries.80 On July 26, 2019, China reportedly approved requests from several
domestic companies to buy U.S. pork products without being subject to retaliatory tariffs.81
However, since President Trump’s August 2019 announcement to levy 10% Section 301 tariffs on
remaining Chinese imports that do not yet have any Section 301 tariffs levied on them, China
responded by asking its state-owned enterprises to halt purchases of U.S. agricultural goods.82 On

79 For more on this issue, see CRS In Focus IF11215, African Swine Fever (ASF).
80 USDA, FAS, “China Livestock and Products Semi-annual Specter of African Swine Fever Casts Pall Over Year of
the Pig; Beef Imports Benefit,” GAIN Report Number:CH19006, March 11, 2019.
81 Shuping, N. and S.Yang, “China Allows Some Tariff-Free U.S. Cotton, Pork Purchases,” Bloomberg News, July 26,
2019.
82 Yang, Y. and A. Zang, “China Tells Companies to Stop Buying U.S. Agricultural Goods,” Financial Times, August
5, 2019.
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August 23, 2019, China imposed additional 10% tariffs on certain U.S. pork products, effective
September 1, 2019, in response to new U.S. Section 301 tariffs on U.S. imports from China.83
China’s Imports of Dairy Products
Since 2016, the United States has been the third largest supplier of dairy products to China ($994
million in 2018), behind the Netherlands ($1.9 billion) and New Zealand ($1.2 billion). China is a
growing market for dairy, with Chinese imports from all countries increasing 25% from $8 billion
in 2017 to $10 billion in 2018.84 Given the diversity of dairy product tariff lines and the varying
rates of Chinese retaliatory tariffs levied on them, the trade effects on the aggregate group is not
as clear as it is for other individual commodities (Figure 11).
Figure 11. China’s Monthly Imports of Dairy Products
In Millions of U.S. Dollars, Since January 2018.

Source: China Customs Data accessed from Global Trade Atlas, July 2019.
Notes: The category includes HS codes supplied by the National Milk Producers Federation, HS lines in 401,
402, 403, 404, 405, 406, 170211, 170219, 190110, 190190, 210500, 350110, 350190, 350220, 151790, 170490,
180620, 180632, 180690, 190110, 190120, 190190, 210690, 220290, 230990, and 350400.
China imposed retaliatory tariffs on U.S. dairy in July 2018 and its imports of U.S. dairy products
gradually declined during the second half of 2018 and into the first two months of 2019 before
turning upward. The fall-off in U.S. dairy shipments to China has generally benefited New
Zealand and Australia, with Chinese imports from these countries climbing in most months. In
January 2018, New Zealand’s share of Chinese dairy import market was 12% and Australia’s was
7%. By May 2019, New Zealand’s market share had grown to 17% and Australia’s to 12%.
China’s top dairy supplier, the Netherlands, lost market share between January 2018 (18%) and
May 2019 (16%). While the United States dropped from the third-largest supplier of dairy
products to China to fourth-largest from January 2018 to May 2019, its market share rose from
10% to 11% over this period, while Australia moved up to become China’s third-largest supplier

83 USDA, FAS, “China Announces Increases to Additional Tariffs,” GAIN Report Number:CH19051, August 28,
2019.
84 According to National Milk Producers Federation the dairy category includes HS lines in 401, 402, 403, 404, 405,
406, 170211, 170219, 190110, 190190, 210500, 350110, 350190, 350220, 151790, 170490, 180620, 180632, 180690,
190110, 190120, 190190, 210690, 220290, 230990, and 350400.
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(Figure 11). U.S. dairy shipments to China since January 2018 indicate an increasing trend,
however, the retaliatory tariffs are likely contributing to faster market share growth for U.S.
competitors in China than for the U.S. dairy sector (Figure 11), particularly since some dairy
products are being levied additional 5% retaliatory tariffs effective September 1, 2019.85
China’s Imports of Hides and Skins
The United States is the largest supplier of hides and skins to China, accounting for about 41% of
China’s total imports from 2016 to 2018. In 2017, shipments of U.S. hides and skins to China
amounted to $918 million. After the imposition of retaliatory tariffs in July 2018, Chinese imports
of U.S. hides and skins declined, with China’s 2018 U.S. hides and skins imports totaling $664
million.86
Figure 12. China’s Monthly Imports of Hides and Skins
In Million U.S. Dollars, Since January 2018

Source: China Customs Data accessed from Global Trade Atlas, July 2019.
Notes: Data includes HS codes 4101, 4102, and 4103.
Major U.S. competitors in China’s hides and skins import market are Australia, Canada and New
Zealand (Figure 12). These countries have not been able to fill the gap created by the decline in
U.S. shipments of hides and skins to China. Consequently, China’s total hides and skins imports
fell 25% in 2018, to $1.6 billion from $2.2 billion in 2017. U.S. shipments of hides and skins to
China declined 28% during the same period. Notwithstanding the tariffs on U.S. origin hides and

85 USDA, FAS, “China Announces Increases to Additional Tariffs,” GAIN Report Number:CH19051, August 28,
2019.
86 Chinese customs data, accessed via Global Trade Atlas, August 2019.
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skins, the decline in U.S. shipments largely mirrored the overall decline in China’s imports with
the result that the United States continued to supply about 41% of China’s total hides and skins
imports in 2018, the same share as in the previous two years. U.S. shipments of hides and skins to
China are may further drop with the additional 10% retaliatory tariff on U.S. imports that became
effective September 1, 2019.87
Retaliatory Partner Imports of Other Agricultural Products
Analysis conducted by economists from University of California, Davis (UC Davis) found that
Chinese retaliatory tariffs decreased U.S. alfalfa exports to China in 2018 compared to the
previous two years.88 From 2016 to 2018, the United States supplied the largest share of China’s
alfalfa imports, accounting for about 79% of China’s total alfalfa import market share in 2016
($417 million) and 72% ($534 million) in 2018.89 In January 2018, China purchased U.S. alfalfa
valued at $40 million. Following the imposition of retaliatory tariffs, U.S. monthly shipments of
alfalfa to China started to decline in the summer of 2018. In November 2018, China’s monthly
imports of U.S. alfalfa amounted to $16 million and totaled $17 million in December 2018.
Another study from UC Davis indicates that U.S. pistachio exports also declined due to
retaliatory tariffs from China and Turkey.90 A third study from UC Davis estimated a combined
short-run export loss for 2018 of $2.64 billion for almonds, apples, pistachios, walnuts, pecans,
sweet cherries, oranges, table grapes, raisins, and sour cherries in four major import markets
(China including Hong Kong, India, Mexico, and Turkey).91
It stands to reason that Chinese retaliatory tariffs may have also affected U.S. exports of certain
other field crops, livestock and animal products, other specialty crops, and processed food
products, that are not covered in this report.
Economic Impact of Retaliatory Tariffs
U.S. agriculture, as a whole, is subject to intense competition, in both domestic and international
markets. As a result, most commodity sectors operate with thin profit margins, making
international sales an important component of revenue. Tariffs, by design, raise the cost of
imported products (see Box 3).92 In general, an increase in import prices due to higher tariffs
leads to a decrease in quantities purchased of the affected products as importers switch to other
foreign suppliers or to alternate products within the domestic market. Thus, the trade impact of
such a price increase will depend in large part on the number of available alternate foreign
suppliers and the availability of substitutes within the domestic market. Furthermore, a decrease
in exports will have an economy-wide effect as the supporting infrastructure—including farms,
marketing cooperatives, warehousing and processing facilities, transportation networks, for

87 Ibid.
88 Sumner, D.A. and W.A. Mathews, “International Trade Prospects and Potential Impact on Forage Crops, Including
the Farm Bill,” University of California, Davis, November 13, 2018.
89 Chinese customs data, accessed from Global Trade Atlas in August 2019. Data includes HS codes 12141000 and
12149000.
90 Sumner, D.A. et al., “Losses for Pistachios from Retaliatory Tariffs and Related Measures,” University of California,
Davis, October 17, 2018.
91 Sumner, D. A. and T. M. Hanon, “Economic Impacts of Increased Tariffs that have Reduced Import Access for U.S.
Fruit and Tree Nuts Exports to Important Markets,” University of California Agricultural Issues Center and Department
of Agricultural and Resource Economics, UC Davis, August 1, 2018, https://aic.ucdavis.edu/2018/08/08/new-tariffs-
tax-economic-prospects-of-tree-nut-and-fruit-industries.
92 Houck, J. P., Elements of Agricultural Trade Policies, 1992, Waveland Press Inc, Prospect Heights, Illinois.
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example—all lose business and revenues. This loss ripples further through the general economy
and can cause decreases in employment and local, state, and federal tax revenues. This section of
the report examines the short-term market impacts and selected economic analyses of longer-term
impacts of the retaliatory tariffs.
Box 5. Key Economic Terms
Given the broad, multifaceted nature of markets, any economic analysis of the impact of a shock or unexpected
event (such as new tariffs or other trade barriers) generally uses a number of simplifying assumptions to control
for several of the moving market pieces. Thus, economic models of a market equilibrium—that is, where supply
and demand of a commodity are in balance, and determine the price of a commodity—build certain limiting
features into their structure. Two such features are the time frame being evaluated and the extent of overlap and
feedback from other economic sectors.
Time Frame: Short- versus Long-Run
In evaluating a shock to a market equilibrium, the primary difference between the short-run and the long-run is
the extent to which resources are allowed to adjust to the shock and provide feedback to the economic system
being evaluated. This difference is fairly distinct for agricultural markets because producers of most temperate
crops such as corn and soybeans are only able to produce a single crop each year. Thus, the time between the
harvest of the current crop and the planting and harvesting of a new crop is the short-run. All market adjustments
that occur within this time frame—whether measured as a price change or a shift in domestic use or trade—are
based on the existing supply of a commodity.
In the long-run, enough time has passed to provide producers the opportunity to make new crop production
choices in response to the market shock; thus, changing the supply of commodities in the market being studied.
To produce long-run estimates, the underlying model and economic analysis assumes that the shock—if in the
form of tariffs or trade barriers—are permanent and that no further shocks occur to the market.
Cross-Sector: Partial versus General Equilibrium Analysis
A partial equilibrium model examines a single market or sector—in isolation from other sectors of the
economy—for its response to a shock. Thus, the partial equilibrium analysis considers the effects of a trade shock
on an individual agricultural commodity, group of commodities or the entire agricultural sector but it does not
consider other sectors of the economy.
In contrast, general equilibrium (GE) models examine several sectors of the economy simultaneously for their
interdependencies and interrelations to understand how the economy as a whole responds to a shock. Thus, GE
analysis is able to evaluate the link between agricultural markets and nonagricultural markets in response to a
trade shock.
Scale of Impact: Local, National, Regional versus Global
A price shock to major traded commodities such as U.S. agricultural products, not only affect the economic well-
being of producers, processors, and sellers of these commodities, but through multiplier effects also affect the
well-being of U.S. rural communities. The length, breadth, and depth of shocks determines the ripple effects into
the national economy. Given the dominant role of U.S. agricultural trade in the global market, the U.S. impacts of
trade wars can influence agricultural production, consumption, and trade of other nations, leading to changes in
foreign national strategies and investments affecting resources used.
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Short-Run Impacts
In the short-run (see Box 5), retaliatory tariffs resulted in lower 2018 purchases of U.S.
agricultural products by countries implementing these tariffs. The prospects for U.S. agricultural
exports to China in 2019 appear to be along the same trajectory. As discussed earlier (Figure 2).
U.S. food and agricultural imports by the EU and Turkey during the first quarter of 2019 were
below the level of imports during the same period in 2017 and 2018.
Similarly, an examination of U.S. monthly exports to China from January to April 2019
demonstrates that the first quarter 2019 agricultural export levels have been below the export
levels during the same period in 2017 and 2018
(Figure 13). Generally, fall harvested crops are
Figure 13. U.S. Agricultural Exports to
exported during late fall and early winter
China, January to April
months, and export levels decline during the
In Thousands of U.S. Dollars, 2017-2019
spring.93
Note that no retaliatory tariffs were in effect
during 2017 or the first quarter of 2018. China
levied the first round of retaliatory tariffs on
U.S. imports in April 2018, in response to U.S.
Section 232 tariffs. Other retaliating countries
followed China’s action with retaliatory tariffs
in June 2018. Additionally, China expanded the
range of affected U.S. imports and increased
tariffs in additional rounds of retaliatory
actions during the summer and fall of 2018, in
response to U.S. Section 301 tariffs. With the
continuation of existing retaliatory tariffs on

almost all U.S. agricultural HS lines, China’s
Source: U.S. Census Bureau Trade Data.
proclamation that its state-owned enterprises
Notes: USDA definition of agriculture: chapters 1-24 of
will halt purchases of U.S. agricultural goods,94
the U.S. HTS (except for fishery products in chapters 3 and
16, manufactured tobacco products like cigarettes and cigars
and the 5% or 10% additional increase in
in chapter 24, and spirits in chapter 22), essential oils
retaliatory tariffs effective September and
(chapter 33), raw rubber (chapter 40), raw animal hides and
December 2019,95 U.S. exports of agricultural
skins (chapter 41), and wool and cotton (chapters 51-52).
products affected by retaliatory tariffs could potentially continue to lose some market share in
China.
In addition to export losses, U.S. agriculture is facing other challenges in 2019. Abundant
domestic and international supplies of grains and oilseeds in 2018 contributed to a fourth straight
year of relatively weak agricultural commodity prices compared to previous years.96 U.S. soybean
output and stocks were record high during 2018 putting downward pressure on soybean prices.
Lower soybean prices contributed to lower corn prices during fall of 2018, as markets speculated
that farmers would switch soybean acres to corn in 2019 (Figure 14).

93 CRS analysis of monthly U.S. soybean exports, using U.S. Census Data, from January 2014 to April 2019 indicate
this pattern.
94 Yang, Y. and A. Zang, “China Tells Companies to Stop Buying U.S. Agricultural Goods,” Financial Times, August
5, 2019.
95 USDA, FAS, “China Announces Increases to Additional Tariffs,” GAIN Report Number:CH19051, August 28,
2019.
96 For more on this issue, see CRS Report R45697, U.S. Farm Income Outlook for 2019.
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Figure 14. U.S. Soybean Farm Prices
In Nominal U.S. Dollars Per Bushels, January 2007-June 2019

Source: USDA, National Agricultural Statistics Service (NASS), August 2019.
On December 1, 2018, the White House released a statement saying that China had agreed to
purchase “substantial amount of agricultural” goods, among other goods.97 This statement was
followed by press reports at different times stating that China had announced it would buy
additional U.S. soybeans.98 The reported Chinese commitments to purchase U.S. soybeans did not
materialize, and soybean prices, which had been on a downward trajectory since early 2018,
declined further in early 2019. Soybean farm prices reached a 12-year low point in May 2019 at
$8.02 per bushel. This coincided with President Trump’s threat to raise Section 301 tariffs, on
U.S. imports from China, from 10% to 25% and to impose additional tariffs on all remaining
imports from China not currently covered by Sections 301 measures. The tariff increases from
10% to 25% were effective May 10, 2019.99 The Trump Administration announced its intent to
impose additional tariff increases of 10% on all other products currently not covered by Section
301 tariffs.100 China responded by asking its state-owned enterprises to halt purchases of U.S.
agricultural goods,101 and by levying two additional sets of tariffs: 5% or 10% tariffs on U.S.

97 White House, “Statement from the Press Secretary Regarding the President’s Working Dinner with China,”
December 1, 2018.
98 Jared, G. “Statement From the Press Secretary Regarding the President’s Working Dinner with China,” Talk
Business and Politics, February 25, 2019; and Tausche, K., “Trump Wants China to ‘Double or Triple’ Its Offer to Buy
US Goods in Trade Negotiations, Sources Say,” CNBC, March 21, 2019.
99 USTR, “Statement by U.S. Trade Representative Robert Lighthizer on Section 301 Action,” Press Release, May 10,
2019; for more information also see CRS Insight IN10943, Escalating U.S. Tariffs: Timeline.
100 USTR, “USTR Announces Next Steps on Proposed 10 Percent Tariff on Imports from China,” Press Release,
August 13, 2019.
101 Yang, Y. and A. Zang, “China Tells Companies to Stop Buying U.S. Agricultural Goods,” Financial Times, August
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imports, including 695 different U.S. agricultural tariff lines effective September 1, 2019; and
another 5% or 10% tariffs on U.S. imports including 184 different U.S. agricultural tariff lines
effective December 15, 2019.102
In 2018, the U.S. farm sector faced the challenge of declining exports and commodity prices for
certain major field crops, in addition to rising operational costs. Various studies predicted that the
imposition of U.S. Sector 232 tariffs on steel and aluminum, in tandem with the domestic content
provisions of the USMCA, could increase the cost of production for U.S. farmers.103 A report
released by the Association of Equipment Manufacturers states that the Trump Administration’s
Section 232 and Section 301 tariffs could hurt the U.S. economy by increasing consumer prices,
including a 6% increase in the cost of manufacturing agricultural and construction equipment.104
U.S. agro-chemical manufacturers have also stated that cost increases, resulting from escalating
tariffs, “of pesticide products for crop and turf protection products ultimately will be passed on to
American growers and businesses.”105
In a sector with relatively thin profit margins, small increases in costs associated with tariffs can
sometimes lead to postponed equipment purchases causing a ripple effect through the farm input
sector. In 2019, several agricultural commodity prices remain under pressure from a record
soybean and near-record corn harvest in 2018, diminished export prospects due to the ongoing
trade dispute with China, and high levels of carryover stocks from the previous year.106
Potential Long-Run Implications
A shift in trade patterns can become permanent if trade disruptions lead to new trade alliances or
stimulate production in retaliating domestic markets or other competing foreign regions, thus
increasing supplies from new sources. An example of such long-term impact of a disruption in
trade on U.S. farm exports is the 1980 U.S. embargo on grain exports to the Soviet Union, which
resulted in declines in U.S. commodity prices and export sales.107 A significant effect of the
embargo was that the United States lost market share in sales to the Soviet Union.108
Additionally, during the early 1970s, the United States imposed a partial embargo on the exports
of soybeans, cottonseed, and certain other products as an inflation fighting measure. The U.S.
soybean export embargo and high prices during this period reportedly prompted greater Japanese

5, 2019.
102 USDA, FAS, “China Announces Increases to Additional Tariffs,” GAIN Report Number:CH19051, August 28,
2019.
103 For example, Burfisher et al., NAFTA to USMCA: What is Gained? IMF Working Paper, WP/19/73, March 2019;
Joseph W. Glauber, The Emperor’s New NAFTA, FARE Share Newsletter, February 2019; Jeffrey J. Schott, PIIE,
October 2, 2018, https://piie.com/blogs/trade-investment-policy-watch/mexico-canada-and-united-states-step-
backwards-trade-and investment.
104 IHS Markit, “The Economic and Industry Impact of Protectionism Tariffs on the Off-Highway Equipment Sector,”
March 2019.
105 CropLife America and Rise, Comments Filed with the U.S. Trade Representative (USTR) Regarding 84 Fed. Reg.
22564, June 17, 2019, http://www.croplifeamerica.org/public-comments.
106 For a discussion of what declining commodity prices, rising input costs, and weakening export prospects mean for
U.S. farm income, see CRS Report R45697, U.S. Farm Income Outlook for 2019.
107 For more information on this issue, see CRS Report No. 80-14 ENR, The U.S. Embargo of Agricultural Exports to
the Soviet Union: Agricultural Impact, November 21, 1980.
108 USDA, ERS, Embargoes, Surplus Disposal, and U.S. Agriculture: A Summary, Agriculture Information Bulletin
No. 503, November 1986, p. 1.
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investments in Brazil’s soybean industry, which has since become the U.S. soybean industry’s
major export competitor.109
As discussed in the section ‘Key Competitors for China’s Agricultural Market’ major agricultural
exporters such as Brazil, Canada, Australia and the EU have recently increased their farm exports
to China. Additionally, countries such as Russia, Ukraine, some Central Asian countries, some
Southeast Asian countries, and some African countries are seeking to establish and expand
footholds in the Chinese market. For the latter group of countries, a prolonged U.S.-China trade
war could facilitate their agricultural development and their share of global exports.
Assuming the continuation of retaliatory tariffs on U.S. soybeans, a USDA 10-year projection
predicts that China’s soybean imports would resume growing, but the volume of future soybean
trade would be less than previously projected—122.8 million metric tons of Chinese imports from
all origins with retaliatory tariffs in 2027 compared with 143 million metric tons of imports
without retaliatory tariffs.110 With U.S. soybeans taxed by retaliatory tariffs, USDA projects that
Brazil would likely account for two-thirds of the growth in global soybean exports to China. In
comparison, the United States accounted for 35% of China’s total soybean imports in 2017 and
18.5% in 2018, while Brazil accounted for 53% of China’s total soybean imports in 2017 and
76% in 2018.111 For U.S. exporters, lower U.S. prices may stimulate additional demand by a
number of countries, but these markets are not likely to absorb the entire volume displaced from
China. The USDA report concludes that alternative export markets for U.S. soybeans can only
absorb a fraction of the soybeans exported to China before trade tensions began, with imports in
these countries growing by less than half of the reduction projected for Chinese soybean imports
in 2027.
China is also investing in agricultural production in U.S. competitor markets and is improving
access for products from these countries. Russia has pledged land to Chinese farmers and has
made a commitment to increase its exports of agricultural products to China.112 While these
commitments are still speculative, during the last two decades, Russian agriculture has moved
toward greater product specialization and strategic investments have been made based on agro-
ecological characteristics. As a result, Russian regional agricultural productivity growth has
increased between 25% and 75%, with higher productivity growths in parts of southern Russia.113
According to Chinese import data, Russia made inroads into China’s food and agricultural market
in 2018 with market share increases compared to 2017 of: 14% for soybean oil; 4% for wheat;
1% for corn; 0.3% for soybeans; 2% for oilseeds; and, some increases in hay market shares,
among others. China’s imports of food and agricultural products from Russia increased 61%
between 2017 and 2018 (Figure 15). China’s imports of Russian cereals increased almost 400%
during the same period, while oilseed imports grew 78%, fats and oils 72%, cocoa and related
products 181%, beer 109%, and animal products 48%. While Russia’s agricultural exports to
China increased in 2018, the value of its shipments represented less than 1% of China’s total

109 Morgan, D. The Merchants of Grain, 1979, Viking Press.
110 Gale et al, Interdependence of China, United States, and Brazil in Soybean Trade, OCS-19F-01, USDA, ERS, June
2019.
111 Chinese customs data accessed via Global Trade Atlas, August 2019.
112 S. Zheng, “Russia Offers 2.5 Million Acres of Land to Chinese Farmers, but Will It Ease Beijing’s Soybean
Shortage?” South China Morning Post, August 15, 2018; Yap, C. “China, Russia Prepare $2 Billion Agricultural
Investment Fund,” Wall Street Journal, May 8, 2015; and Grove, T. and A. Kurmanaev, “A Surprise Winner From the
U.S.-China Trade Spat: Russian Soybean Farmers,” Wall Street Journal, February 21, 2019.
113 Rada et al, “Agricultural Recovery in Russia and the Rise of Its South,” Amber Waves, USDA, ERS, April 25, 2017.
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agricultural product imports of $127 billion that year. Market watchers expect Russia will need
years to become a major agricultural supplier to China.114
Figure 15. China’s Imports of Russian Agricultural Products
In Millions of U.S. Dollars, 2016-2018

Source: China Customs Statistics accessed via Global Trade Atlas, July 1, 2019.
Notes: Other animal prods = Other animal products
Globally, a USDA study reports that over 1,300 Chinese enterprises had overseas investments in
agriculture, forestry, and fisheries valued at $26 billion in 2016.115 The investments include crop
and livestock farming, fishing, processing, farm machinery, inputs, seeds, and logistics in over
100 countries. Most of China’s foreign agricultural projects involve relatively small companies
investing in neighboring countries in Southeast Asia, Russia’s Far East, and Africa that have
unexploited land and are often receptive to Chinese investment. China’s agricultural investment
decisions are linked to its “One Belt, One Road” initiative.116 Additionally, Chinese companies
seeking sources of dairy, beef, and lamb imports have focused their investments and partnerships
with New Zealand and Australia.

114 Kitanaka, A. and J. Rogers “Russia Can’t Satisfy China’s Soybean Needs Amid U.S. Trade War,” Bloomberg News,
August 19, 2019; and Rappeport, A. and K, Bradsher, “As U.S, China Trade War Escalates, American Farm Goods are
Targeted Again,” Farm Policy News, August 25, 2019.
115 Gooch and Gale, “China’s Foreign Agriculture Investments,” Economic Information Bulletin, Number 192, USDA,
ERS, April 2018.
116 China’s “One Belt, One Road” initiative is its foreign policy and economic strategy to connect Asia with Africa and
Europe via land and maritime networks along six corridors with the aim of improving regional integration, increasing
trade and stimulating economic growth. For more information on this issue, see CRS In Focus IF10273, China’s “One
Belt, One Road”.
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Box 6. China Improves Market Access for Non-U.S. Oilseeds and Products
According to a June 2019 USDA report, Interdependence of China, United States, and Brazil in Soybean Trade, China is
adopting various strategies to supplement soybean meal supplies.

China’s customs administration lifted a ban on rapeseed meal imports from India.

China’s Ministry of Finance eliminated a value-added tax rebate for soybean meal exports as of November 1,
2018.

China’s Ministry of Finance announced elimination of tariffs on soybeans and soybean meal from India, South
Korea, Bangladesh, Laos, and Sri Lanka as of July 1, 2018, as part of efforts to complete an Asia-Pacific trade
agreement.

China’s customs administration announced an agreement to open China’s market to imports of Ethiopian
soybeans.

Chinese authorities auctioned 2 mil ion metric tons of soybeans from government reserves.

China’s customs administration added imported meals made from rapeseed, peanuts, palm kernels, sunflower
seeds, cottonseed, and sugar meal to a list of items exempt from border inspections as of June 1, 2018.
Soybean meal was excluded from the list.

China’s State Council announced a temporary elimination of import tariffs for plant-based oil meals beginning
January 1, 2019.
Note that some of the changes made by China are improvements to China’s World Trade Organization (WTO)
market access commitments. All WTO member countries can potentially benefit from these changes. However,
existing retaliatory tariffs on U.S. imports make U.S. products more expensive to Chinese importers compared
with comparable imports from other trading partners.
Since 2018, China has taken additional actions to reduce import-export taxes and duties to
facilitate agricultural imports from non-U.S. sources, particularly for non-U.S. oilseeds and
products (Box 6).117 Effective April 2019, value added taxes (VAT) on agricultural products were
reduced to 9% from the original 11% or 17%. Starting January 1, 2019, reductions in customs
duties, including MFN tariffs and temporary duty rates, were implemented for certain imported
goods in order to boost imports and meet domestic demand. The temporary duty rates, which are
even lower than the MFN tariffs, are in effect on 706 imported commodities, including some
agricultural products.118 With retaliatory tariffs in place, U.S. agricultural exporters are unable to
take full advantage of these improved terms of market access.
Estimated Economic Impacts
The following section provides examples of estimated economic impacts associated with
retaliatory tariffs imposed on U.S. agricultural products by U.S. trading partners. These impacts
are estimated at different scales by different studies, or are derived from market data. The
examples are illustrative; they are not meant to be comprehensive.
Commodity Level
Various studies have estimated potential economic impacts arising from retaliatory tariffs on
specific U.S. commodities (see Box 5 for general assumptions regarding these studies). For

117 Dezan, Shira and Associates, “Import-Export Taxes and Duties in China,” China briefing, June 11, 2019. While the
United States is not excluded from the general benefits associated with most of the reductions in China’s market access
barriers, the existence of retaliatory tariffs are a disadvantage to U.S. agricultural exports.
118 This includes products from HTS chapters 4, 5, 8, 12, 13, 14, 15, 18, 19, 21, 22, 23, 24, 52 and 53, accessed at
http://gss.mof.gov.cn/zhengwuxinxi/zhengcefabu/201812/P020181221619891346040.pdf.
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example, one study of short-term119 effects predicted U.S. farm prices would decrease in response
to China’s retaliatory tariffs, the value of U.S. exports to China would decline and U.S. farmers
would reduce acreage planted the following year to soybeans, cotton, sorghum, and would reduce
pork production, ultimately resulting in revenue declines for U.S. producers.120
A similar short-term impact analysis, conducted by the Center for North American studies at
Texas A&M University examined the impact on U.S. dairy of a 25% retaliatory tariff levied by
Mexico on U.S. cheese imports and a 25% retaliatory tariff imposed by China on imports of U.S.
dairy products.121 The study estimated export losses and pointed out that U.S. dairy exports are
supported by a large infrastructure including dairy farms, marketing cooperatives, and
warehousing and processing facilities. Thus, the study concluded that any significant change in
exports is likely to ripple through the supporting infrastructure and effect the general economy. In
the case of Mexican tariffs on U.S. cheese, which Mexico removed in May 2019, the study
estimated that U.S. economy-wide economic losses would be $991 million per year with nearly
5,000 lost jobs. In the case of Chinese tariffs on U.S. dairy imports, the study suggested that the
economy-wide losses could total $2.8 billion per year and lead to over 13,000 jobs lost.
State Level
In September 2018, the Center for Agricultural and Rural Development (CARD) at Iowa State
University estimated the short-run effects of the 2018 trade disruptions on the Iowa economy.122
This study incorporated the potential offsetting effects from USDA’s trade-aid package.123 The
study focused on the impact of foreign retaliatory tariffs124 on U.S. corn, soybean, hog, and
ethanol markets along with labor and government revenue impacts from changes in these
markets.125 It used a number of different modeling approaches that resulted in the following
estimates of annual impact.
 The study estimated that Iowa’s soybean industry would lose $159 million to
$891 million, with an average revenue loss across all models of $545 million
(Iowa soybeans are a $5.2 billion industry).
 The study estimated that Iowa’s corn industry would lose $90 million to $579
million, with an average revenue loss across all models of $333 million (Iowa
corn is an $8.5 billion industry).
 The study estimated that Iowa’s pork/hog industry would lose $558 million to
$955 million, with an average revenue loss across all models of $776 million (the
Iowa pork/hog industry is a $7.1 billion industry).

119 As defined in Box 5, short-tern effects generally indicate effects related to a single crop year.
120 Zheng et al., “Predicting Potential Impacts of China’s Retaliatory Tariffs on the U.S. Farm Sector,” Choices,
Quarter 2, 2018; http://www.choicesmagazine.org/choices-magazine/theme-articles/us-china-trade-dispute-and-
potential-impacts-to-agriculture/predicting-potential-impacts-of-chinas-retaliatory-tariffs-on-the-us-farm-sector.
121 Ribera et al., “Estimated Economic Impacts of Retaliatory Tariffs by China and Mexico on U.S. Dairy Products,”
CNAS Report 2018-3, September 2018; http://cnas.tamu.edu/.
122 Balistreri et al., “The Impact of the 2018 Trade Disruptions on the Iowa Economy,” CARD Policy Briefs, 18-PB 25,
CARD, Iowa State University, September 2018; https://www.card.iastate.edu/products/publications/synopsis/?p=1281.
123 For more information on this issue, see CRS Insight IN11126, New Round of Farm Trade Aid Proposed by
Administration for 2019.
124 The study includes all retaliatory tariffs existing in 2018. Note that the retaliatory tariffs implemented by Mexico
and Canada were removed in May 2019.
125 The CARD study used a general equilibrium input-output modeling system (IMPLAN). The model controls for the
effects of 2018’s large corn and soybean harvests before estimating the effects of the tariffs on commodity prices.
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 The study estimated that ethanol prices would drop 2% resulting in
approximately $105 million in lost revenues to Iowa ethanol producers (investors
in the ethanol industry). The study points out that by mid-August 2018, corn
prices retreated nearly 9% and ethanol prices receded by roughly 4%. Over the
same period, corn futures for the 2018 crop declined 9% and ethanol futures
declined 8%.
In the longer-term (see Box 5 for definition), according to the Iowa State University study,
revenue losses in these industries would translate into additional lost labor income across the
state. The study estimates that labor income declines from the impacts to the corn, soybean, and
hog industries would range from $366 million to $484 million without federal offsets from the
trade-aid package, and $245 million to $364 million with federal offsets. Iowa tax revenue losses
(personal income and sales taxes) would range from $111 million to $146 million annually.
Federal offsets would reduce tax losses to $75 million to $110 million. The study estimates
overall losses in Iowa’s Gross State Product of $1 billion to $2 billion annually (out of a total of
$190 billion).
Similarly, a study commissioned by the Nebraska Farm Bureau on the short-run economic costs
in 2018 for the state from the retaliatory tariffs concluded that Nebraska’s general economy
would incur costs between $164 million and $242 million in lost labor income, along with the
loss of 4,100 to 6,000 jobs.126 In total, together with the direct agriculture-related costs,
Nebraska’s overall economic loss in 2018 was estimated at $859 million to $1.2 billion.
Retaliatory tariffs in 2018 (on corn, soybeans and hogs from all retaliating countries) were
expected to reduce corn prices by $0.14 to $0.21 per bushel, soybean prices by $0.95 to $1.54 per
bushel, and hog prices by $17.81 to $18.80 per head. These estimated price declines would
translate into farm revenue losses for each commodity of: corn ($257 million to $327 million);
soybeans ($384 million to $531 million); and pork ($111 million).
The Nebraska Farm Bureau updated its analysis in 2019 and concluded that the ongoing
retaliatory tariffs imposed by countries on U.S. agricultural exports would cost Nebraska
producers $943 million in lost revenues in 2019.127 The methodology used for the analysis
borrowed USDA’s estimates of gross damages that were used in calculating USDA’s trade-aid
payments. The estimated loss calculation did not take into consideration trade-aid payments that
Nebraska farmers may receive in 2019.
Economists from University of California, Davis, found the short-run effects of the retaliatory
tariffs on the 2018 crop for 10 selected specialty crops in four export markets—China, Mexico,
Turkey and India—to be $2.64 billion of lost export value and $3.34 billion of combined U.S.
revenue losses.128 The crops considered are almonds, pecans, pistachios, walnuts, apples, oranges,

126 Nebraska Farm Bureau, “A Path Forward on Trade Retaliatory Tariffs and Nebraska Agriculture,” December 6,
2018, https://www.nefb.org/newsroom/news-releases/1391-report-finds-1-billion-hit-to-nebraska-from-retaliatory-
tariffs-farm-bureau-offers-path-forward-on-trade. This study used a general equilibrium model (IMPLAN, similar to
the CARD model of footnote 122) of the Nebraska economy focusing on the impact of retaliatory tariffs on corn,
soybeans, and hogs. Beef and ethanol—two major agricultural products of Nebraska—were not included. The model
controls for the effects of 2018’s large corn and soybean harvests before estimating the effects of the tariffs on
commodity prices.
127 Nebraska Farm Bureau, “Farm Bureau Estimates Tariff Related Losses Cost Nebraska Farmers Nearly $1 Billion in
2019,” September 3, 2019, https://nefb.org/newsroom/news-releases/1902-farm-bureau-estimates-tariff-related-losses-
cost-nebraska-farmers-nearly-1-billion-in-2019.
128 Sumner, D. A. and T. M. Hanon, “Economic Impacts of Increased Tariffs that have Reduced Import Access for U.S.
Fruit and Tree Nuts Exports to Important Markets,” University of California Agricultural Issues Center and Department
of Agricultural and Resource Economics, UC Davis, August 1, 2018; https://aic.ucdavis.edu/2018/08/08/new-tariffs-
tax-economic-prospects-of-tree-nut-and-fruit-industries.
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raisins, sour cherries, sweet cherries, and table grapes. Mexico had retaliatory tariffs on apples
and prepared fruit in 2018, but removed them in May 2019. India had identified apples, almonds
and walnuts for retaliatory tariffs in 2018 but did not implement these until June 2019.
National Level Effects of Retaliatory Tariffs
Box 7. Global Trade Analysis Project (GTAP) Model
Globally, most of the national and regional economic studies use a general equilibrium (GE) model, often the
Global Trade Analysis Project (GTAP) model, and nearly all use GTAP database—which is calibrated to the 2014
base period. Simulations made with GTAP determine changes in demand and supply of all goods and services and
their prices in each region; changes in bilateral trade among all trading partners for all goods and services; changes
in allocation of resources; and country-by-country changes in economic gains or losses among other outputs. This
modeling framework assumes each trade policy scenario would remain in place for at least 3 to 5 years or until
the market equilibrium stabilizes fol owing the initial policy shock; thus, these are not short-run impacts.
Analysis conducted at the national level examines U.S. import price shocks embedded in a multi-country, multi-
sectoral model, which undergoes simulation until a new “market equilibrium” (where total supplies are equal to
total demand) is reached. Since the analysis is embedded within a global model, the results can provide information
on U.S. trading partners. Results from GE analyses are sensitive to the degree of price responsiveness displayed by
import markets to substitute the source of an imported product. For example, the propensity of Chinese
importers to substitute away from U.S. soybeans when the U.S. soybean price rises relative to prices from other
potential sources, such as domestically produced Chinese soybeans or imports from other countries. The greater
the responsiveness, the greater the change in market outcomes. When the parameter used to represent the
propensity to substitute is changed, the size of the estimated impact can change.
For more on the GTAP global consortium, model, data, and publications, see
https://www.gtap.agecon.purdue.edu/.
Two studies conducted by researchers at Purdue University, using the Global Trade Analysis
Project (GTAP) model (see Box 7), examined the potential long-run impacts of retaliatory tariffs
on U.S. agriculture and U.S. economy at the
national level. As discussed in the box “Key
Box 8. Economic Welfare
Economic Terms,” the long-run effects are
Economic welfare provides an estimation of how well
estimated assuming that the shock to the
individuals in an economy are doing. This takes into
market, such as tariff increases, remain in
consideration the well-being of both the producers and
the consumers. Economic welfare is considered to be
place for a few years and sufficient time has
optimized when competitive markets are in equilibrium
passed to provide producers the opportunity to
with supply meeting consumer demand. Competitive
make changes in response to this shock. The
market conditions include transparent, easily accessible
studies discussed below assume that the
knowledge of market conditions by all participants; no
barriers to entry or exit; relatively homogeneous
retaliatory tariffs remain in place for 3 to 5
goods; a large number of market participants, all of
years.
which behave rationally and are price takers; no
externalities; and the absence of intrusive government
The first study estimated the long-run effects
regulation.
(defined in Box 7 as 3-5 years) of a 25% tariff
For more on this topic see, Paul Krugman and Robin
imposed by China on soybeans and other
Wells, Microeconomics, 2nd ed. (New York: Worth
selected U.S. agricultural products—wheat,
Publishers, 2009).
corn, sorghum, rice, rapeseed, and beef.129
This study concluded that U.S. soybean market losses in China would, over the years, benefit
Brazil. Given U.S. soybean industry’s large share of China’s import market prior to the retaliatory
tariffs, the study estimated large price declines and export losses for U.S. soybeans. Other

129 Taheripour, F. and W. Tyner, “Impacts of Possible Chinese Protection of 25 Percent on U.S. Soybeans and Other
Agricultural Commodities,” supported by U.S. Soybean Export Council, GTAP Working Paper No. 83, Purdue
University, Department of Agricultural Economics, April 2018.
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commodities in the study appeared less dependent on the Chinese market and the estimated losses
are relatively smaller. The study predicted that the overall economic welfare (see Box 8) for both
the United States and China would decline, while the economic welfare for Brazil would increase.
The second study examined a scenario in which the USMCA would be implemented but the
retaliatory tariffs related to Section 232 steel and aluminum tariffs would also exist.130 The study
looked at two separate cases for retaliatory tariffs: i) retaliatory tariffs were considered only for
Mexico and Canada; and ii) retaliatory tariffs from all countries were considered.
This study estimated, in 2014 dollars, a net increase in annual U.S. agricultural exports of $450
million under USMCA, which is equal to about 1% of U.S. agricultural exports under NAFTA—
$41 billion in 2014. It projected the export losses from the retaliatory tariffs imposed by Canada
and Mexico to be $1.8 billion per year (in 2014 dollars), which would more than offset the
projected export gain of $450 million from USMCA. When retaliatory tariffs from all countries
were considered, export losses were estimated at around $8 billion. Note that both Canada and
Mexico have removed their retaliatory tariffs since May 2019.
A study conducted by economists at Iowa State University examines the national level effects of
retaliatory tariffs imposed on U.S. pork, soybeans, corn, and wheat by China and Mexico during
2018.131 Note that Mexico removed the retaliatory tariffs in May 2019. The study simulates multi-
year projections over a period of 9 years. The study indicate that if the retaliatory tariffs were to
continue, U.S. annual exports would decline by 30% for pork and corn, 15% for soybeans and
1.5% for wheat compared with a baseline scenario which considers the average of the past three
year period. The estimated that in the short-run (which the paper defines as first three years with
retaliatory tariffs) trade losses would translate to 26,000 job reductions on average annually in the
United States and a decline in labor income of $1.5 billion due to a $5.3 billion reduction in
national annual output. In the long run (defined by the paper as year-7 through year-9 with
retaliatory tariffs), the annual impacts would was estimate to grow to nearly 60,000 fewer jobs,
$3.1 billion less labor income, and a loss of almost $12 billion in national output.
Global Level Effects
The United Nations Conference on Trade and Development (UNCTAD) performed a global
analysis of the U.S. Section 232 and Section 301 tariffs and the resulting retaliatory tariffs,
including retaliatory tariffs on U.S. agricultural products.132 The analysis mainly focused on U.S.-
China tariff escalation. Regarding agriculture, the study points out that China accounts for more
than half of the global imports of soybeans and that the United States is the world’s largest
soybean producer. The study states that the Chinese tariffs on U.S. soybeans have substantially
disrupted world trade of this commodity and observes that increased Chinese demand has resulted
in higher prices for Brazilian soybeans. It cautions that while higher price premiums could be
beneficial in the short run to Brazilian producers, they may hamper Brazilian procurers’ long run
competitiveness. In a situation where the size and amount of the tariffs and their duration is

130 Chepeliev et al., “How U.S. Agriculture Will Fare Under the USMCA and Retaliatory Tariffs,” commissioned by
the Farm Foundation, GTAP Working Paper No. 84, Purdue University, Department of Agricultural Economics,
October 2018.
131 Elobeid, A. et al., “Analysis of the Effects of Chinese and Mexican Retaliatory Tariffs on Select U.S. Agricultural
Commodities on U.S. and Global Markets,” Selected Paper prepared for presentation at the 2019 Agricultural &
Applied Economics Association, Annual Meeting, Atlanta, GA, July 21 – July 23, 2019. This uses the IMPLAN model
and not the GTAP model.
132 United Nations Conference on Trade and Development (UNCTAD), Key Statistics and Trends in Trade Policy:
2018, UNCTAD/DITC/TAB/2019/1, 2019.
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unclear, Brazilian producers may be reluctant to make investment decisions that may turn
unprofitable if tariffs are removed. Moreover, Brazilian firms using soybeans as inputs (e.g., feed
for livestock) may lose competitiveness because of higher input prices.
A USDA study released in 2019 found that the United States and Brazil are among the lowest-
cost producers of soybeans.133 While land rental costs and labor costs are higher in the United
States, poor soils and tropical ecology requires Brazil to use higher levels of agrochemicals.
Moreover, the United States has a transportation advantage over Brazil in exporting agricultural
products to China. Specifically, the study concluded that transporting soybeans by truck from
northern Mato Grosso to Brazil’s primary soybean export port of Paranaguá cost $93 per metric
ton (MT) in 2017. During the same period, transporting soybeans from Davenport, Iowa, to the
Gulf of Mexico by truck, rail, and barge cost $65 per MT. Shipping soybeans by truck and rail
from Sioux Falls, South Dakota, to the U.S. Pacific Northwest cost $68 per MT.134 The United
States, therefore, has lower transportation costs and greater production efficiency (requiring less
agrochemicals) compared with Brazil in producing and shipping agricultural products to Asian
markets. According to the study, the current trade dispute and retaliatory tariffs may, in the long
run, lead to inefficient allocation of resources and exploitation of less-productive lands than those
in the United States.
Some Possible Benefits to U.S. Agriculture
Based on economic principles, if the price of an input such as soybeans or feed corn declines, the
livestock sector would be expected to benefit. USDA’s Economic Research Service’s production
expenses report states that the cost of livestock feed declined 1% between 2017 and 2018,
however, they are expected to increase 4.5% in 2019.135 Additionally, the U.S. livestock sector is
also facing retaliatory tariffs. Similarly, many processed food products that use raw agricultural
products as inputs face Chinese retaliatory tariffs.
While major stakeholders in agriculture have expressed concern about the effects of the tariff
dispute and of the retaliatory tariffs on U.S. farm exports, some industries may nevertheless
obtain certain short-term transient benefits. For example, feed (mainly corn and soybeans) is a
major cost input for raising chicks into market-ready broiler chickens. Between June 2018 and
June 2019, the cost of feed of producing a broiler declined by 12%, according to USDA.136
Some sectors may nevertheless benefit from retaliatory tariffs. For example, the Coalition for a
Prosperous America (CPA) released a study stating that a permanent across-the-board 25% tariff
on all imports from China would stimulate GDP growth and jobs in the U.S. economy.137 The
study uses data from Boston Consulting Group that is not publicly available, and the publicly
available working paper does not describe the Regional Economic Models, Inc. (REMI model) or
the assumptions underlying the model.138 Regarding agriculture, the study states that when the

133 Gale et al, Interdependence of China, United States, and Brazil in Soybean Trade, OCS-19F-01, USDA, ERS, June
2019.
134 Ibid. Also note that U.S. grain and oilseed exporters have a $25 to $28 per MT advantage in moving produce from
farm to port. With respect to ocean freight rates, the Pacific Northwest has a small advantage ($27.50 per MT) over
both Brazil ($33 per MT.) and the U.S. Gulf ($42 per MT).134
135 USDA, ERS, “Farm Income and Wealth Statistics, Production Expenses,” August 2019,
https://data.ers.usda.gov/reports.aspx?ID=17834.
136 USDA, ERS, Livestock & Meat Domestic Data, August 27, 2019.
137 Ferry, J., “Update: Across-the-Board Tariffs on China with Retaliation and Federal Spending Create Over 1 Million
Jobs in Five Years, Working Paper, August 14, 2019.
138 Note that the other models discussed in the report such as GTAP or IMPLAN use data and models that are
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USDA trade-aid programs are incorporated “into the model, the additional government spending
fully offsets the negative impact of the Chinese retaliation on US GDP.”
In addition to the CPA study, there have been anecdotal reports in the media that organic and
small-holder farmers are benefiting from China’s retaliatory tariffs.139
U.S. Stakeholder Views on Retaliatory Tariffs
In May 2019, American Farm Bureau Federation President Zippy Duvall stated that, “Retaliatory
tariffs are a drag on American farmers and ranchers at a time when they are suffering more
economic difficulty than many can remember,” and urged negotiators to continue their work
toward re-opening markets with the European Union, China and Japan.140 The President of the
National Farmers Union (NFU) echoed the same sentiment, stating that the retaliatory tariffs
“could not come at a worse time for family farmers and ranchers, who are already coping with
depressed commodity prices, environmental disasters, and chronic oversupply." The NFU
President further stated that although temporary relief is appreciated, “temporary solutions are not
sufficient to address the permanent damage the trade war has inflicted on agricultural export
markets."141
Various U.S. agricultural commodity groups have voiced similar concerns. For example, the
American Soybean Association expressed “extreme disappointment” over USTR’s escalating
tariffs on China that led to retaliatory tariffs on soybeans.142 The National Pork Producers Council
(NPPC) stated that the retaliatory tariffs are “threatening the livelihoods of thousands of U.S. pig
farmers.”143 Due to African Swine Fever (ASF), China normally would have turned to the United
States to meet its pork demand.144 With retaliatory tariffs in place, U.S. pork is more expensive
than products from other sources in the Chinese market. NPPC Vice President Nick Giordano
stated that from a U.S. farmer's perspective, China’s increased demand for imported pork
resulting from ASF in Chinese hogs would have been "the single greatest sales opportunity in our
industry's history." According to a report in the South China Morning Post, Iowa State University
economist Dermot Hayes estimates that the trade dispute with China has cost American pig
farmers $8 per animal, or $1 billion in total losses.145 The U.S. Dairy Export Council, in turn,
stated in 2018 that the retaliatory tariffs that China and Mexico imposed could result in billions of
dollars of lost sales for U.S. dairy producers.146

extensively documented and accessible to the public.
139 For example, Reuters, “America’s Garlic Capital on Trade War: ‘We’d Love The Tariffs to Stay For Ever’,” May
21, 2019.
140 American Farm Bureau Federation, “Farm Bureau Statement on Lifting of Agricultural Tariffs,” May 17, 2019.
141 Moritz-Rabson, “Farm Union President Calls Trump's Proposed $15 Billion Subsidy an Insufficient, 'Temporary'
Solution,” Newsweek, May 13, 2019.
142 ASA, “Soy Growers Disappointed in Additional Tariffs, Continue to Seek Export Stability with Largest Customer,”
press release, July 12, 2018.
143 NPPC, “China Tariffs on U.S. Pork Now Tops 60 Percent; American Pork Producers Face Financial Crisis,” Press
Release, July 6, 2018.
144 For more information on this issue, see CRS In Focus IF11215, African Swine Fever (ASF).
145 L. Crampton with K. Elmer, “Trump Tariffs Crush U.S. Pig Farmers,” South China Morning Post, June 19, 2019.
146 U.S. Dairy Export Council, “Chinese and Mexican Tariffs Will Cost Dairy Industry Billions If Left Unchecked,”
Press Release, August 27, 2018.
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A study released by the Association of Equipment Manufacturers states that tariffs on steel and
aluminum have increased cost of agricultural production due to rising prices of farm equipment
and their parts.147 In a comment filed with USTR, CropLife America and a specialty chemical
trade group Responsible Industry for a Sound Environment (RISE) state that cost increases,
resulting from escalating tariffs, “of pesticide products for crop and turf protection products
ultimately will be passed on to American growers and businesses.”148
Dozens of stakeholder panels provided testimony to the USTR during hearings in June 2019
regarding a proposed notice to begin imposing additional tariffs of 25% to virtually all remaining
imports from China.149 Hundreds of U.S. companies and industry groups, including some of the
largest companies argued that, “both sides will lose” in a protracted trade war. “Tariffs are taxes
paid directly by U.S. companies, including those listed below—not China,” stated a letter signed
by more than 600 companies, including Association of Equipment Manufacturers, American
Bakers Association, Grocery Manufacturers Association, Juice Products Association, Distilled
Spirits Council of the United States, and many other food retailers and associations related to the
food industry.”150
On June 21, 2019, hundreds of domestic producers and four manufacturing and labor groups sent
a letter to President Trump urging him to maintain his hardline approach to China. The letter was
signed by the Coalition for a Prosperous America, which includes mainly non-agricultural
manufacturing companies and some food and agriculture related small companies like the Platt
Cattle Company of Arizona and Johanna Foods of New Jersey.151
To help alleviate the losses from the retaliatory tariffs, USDA announced a second round of trade
aid package in 2019.152 Most industry groups welcomed this package but indicated their
preference for trade rather than aid.153 American Farm Bureau Federation President Zippy Duvall
stated, “It is critically important to restore agricultural markets and mutually beneficial
relationships with our trading partners around the world.”154 Similar sentiments were expressed
by a number of other major agricultural trade associations such as the National Council of Farmer
Cooperatives, the American Soybean Association, the National Cotton Council, the National Milk
Producers Federation, the National Pork Producers Council. For its part, the National Association

147 IHS Markit Economics and Country Risk, “ The Economic and Industry Impact of Protectionism Tariffs on the Off-
Highway Equipment Sector,” released by the Association of Equipment Manufacturers, March 21, 2019; and Burfisher
et al., NAFTA to USMCA: What is Gained? IMF Working Paper, WP/19/73, March 2019.
148 CropLife America and Rise, Comments Filed with the U.S. Trade Representative (USTR) Regarding 84 Fed. Reg.
22564, June 17, 2019, http://www.croplifeamerica.org/public-comments.
149 USTR, Public Hearings on Proposed Section 301 Tariff List, Press Release, June 14, 2019; and D. Palmer and A.
Kimbel-Sannit, “Companies Plead with Trump against New China Tariffs,” Politico, June 17, 2019.
150 Tariffs Hurt The Heartland, “661 U.S. Companies and Associations Urge Administration to Avoid Tariff
Escalation, Reach Resolution with China,” June 13, 2019, https://tariffshurt.com/news/661-u-s-companies-and-
associations-urge-administration-to-avoid-tariff-escalation-reach-resolution-with-china.
151 Coalition for a Prosperous America, “Country First Letter,” June 21, 2019,
https://www.prosperousamerica.org/more_than_600_u_s_companies_sign_letter_in_support_of_trump_s_tariffs.
152 For more on this see, CRS Report R45865, Farm Policy: USDA’s 2019 Trade Aid Package; and also see USDA,
“USDA Announces Support for Farmers Impacted by Unjustified Retaliation and Trade Disruption,” Press Release,
May 23, 2019.
153 The Hagstrom Report, “Farm Groups Praise Trade Aid With Some Caveats,” Vol. 9, No. 153, July 26, 2019.
154 American Farm Bureau Federation, “Farm Bureau Welcomes Trade Assistance, Urges Return to Open Markets,”
July 25, 2019.
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of Wheat Growers stated that the trade-aid package “is a Band-Aid when we really need a long-
term fix.”155
Issues for Congress
In May 2019, President Trump proposed levying additional tariff increases on imports from
China,156 but they were held in abeyance following a meeting between President Trump and
Chinese President Xi Jinping at the G-20 summit in June 2019.157 However, the President stated
on August 2019 that he would impose a tariff hike increase on all other Chinese products
currently not covered by Section 301 tariffs. China responded by asking its state-owned
enterprises to halt purchases of U.S. agricultural goods.158 On August 13, 2019, USTR released
the remaining list of Chinese products that would be levied a 10% Section 301 tariff effective
September 1, 2019 and another list of products that would be levied 10% Section 301 tariffs
effective December 15, 2019.159 China in turn has retaliated by levying additional two sets of
tariffs: 5% or 10% tariffs on U.S. imports, including 695 different U.S. agricultural tariff lines
effective September 1, 2019; and another 5% or 10% tariffs on U.S. imports including 184
different U.S. agricultural tariff lines effective December 15, 2019.160
Given the length of the trade dispute over Section 232 and Section 301 actions and the expanding
list of U.S. exports affected by the retaliatory tariffs, the list of affected sectors is also expanding.
A June 2019 USTR hearing for Section 301 tariffs included a diversity of witnesses across 55
panels over a 7-day period.161 As such, an issue for congressional consideration may be whether
compensation for the losses arising from the various trade disputes should extend beyond those
producers of agricultural commodities identified in the Administration’s trade aid initiative.
USDA, using its authority under the CCC, is administering this assistance. Retaliatory tariffs have
arguably affected businesses beyond the farm gate, including agricultural exporters, input
suppliers, agricultural shippers, and others, potentially raising the question of whether these
industries merit government compensation for tariff-related losses.
Separately, some agricultural stakeholders have questioned the equity of the distribution of the
2018 trade aid payments. Once the formula became public, several commodity groups questioned
the rationale for determining payments based on “trade damage” rather than the broader “market
loss” measure.162 Similar questions163 have emerged about the 2019 trade-aid package.164 These

155 National Association of Wheat Growers, “NAWG Responds to USDA’s Announcement on Another Round of MFP
Payments for Farmers ,” Press Release, July 25, 2019. https://www.wheatworld.org/release-nawg-responds-to-usdas-
announcement-on-another-round-of-mfp-payments-for-farmers/; and The Hagstrom Report, “Farm Groups Praise
Trade Aid With Some Caveats,” Vol. 9, No. 153, July 26, 2019.
156 For more on this issue, see CRS Insight IN10971, Escalating U.S. Tariffs: Affected Trade.
157 D. J. Lynch and D. Paletta, “U.S. and China Agree to Restart Trade Negotiations Following Meeting Between
Trump and Xi at Group of 20 Summit,” Washington Post, June 29, 2019.
158 Yang, Y. and A. Zang, “China Tells Companies to Stop Buying U.S. Agricultural Goods,” Financial Times, August
5, 2019.
159 USTR, “USTR Announces Next Steps on Proposed 10 Percent Tariff on Imports from China,” August 13, 2019.
160 USDA, FAS, “China Announces Increases to Additional Tariffs,” GAIN Report Number:CH19051, August 28,
2019.
161 USTR, “Public Hearings on Proposed Section 301 Tariff List,” Press Release, June 14, 2019.
162 For more information on this issue, see CRS Report R45310, Farm Policy: USDA’s 2018 Trade Aid Package.
163 For examples, see CRS Report R45865, Farm Policy: USDA’s 2019 Trade Aid Package.
164 USDA, “USDA Announces Details of Support Package for Farmers,” Press Release No. 0114.19, July 25, 2019.
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questions concern the methodology used to calculate the payment rates, commodity coverage of
the direct payments, and the equity of payments across regions and commodity sectors.
The provision of trade aid has also raised questions regarding U.S. commitments under the WTO
and other international agreements. Several WTO members, including the EU, Canada, Australia,
New Zealand, India, and Ukraine have asked for more details regarding USDA’s trade aid
package to ascertain whether it could be considered market-distorting under U.S. WTO
commitments.165
Given the growth of investments directed to increase agricultural productivity in many countries
including Russia, and the recent gains that Russia, Brazil, and other countries have made in
China’s import market for agricultural products, it may be of interest to Congress to consider
whether current policies are sufficient for U.S. agriculture to continue to expand its overseas
markets.
As other countries expand their agricultural production to meet China’s import demand, studies
by environmental groups caution that this agricultural expansion may occur at the expense of
tropical forest and fragile habitats that are essential to maintain global biodiversity.166 The United
States is one of the most efficient and lowest cost producers of food and agricultural products.167
Congress may want to consider whether the current trade dispute could have long-term
environmental costs as less productive, or environmentally vulnerable areas, are cultivated for
agricultural production in lieu of more efficient and less environmentally sensitive U.S.
production.168

165 National Grain and Feed Association, “WTO Nations Question Legality of U.S. Disaster Aid and Trade-Disruption
Assistance Payments,” Agricultural Policy Newsletter, June 20, 2019.
166 PBS, “How the U.S.-China Trade War Could Damage the Amazon Rainforest,” March 27, 2019; Mangan, E.,
“Forests Could Be Casualties in a U.S.-China Trade War,” World Resources Institute, March 14, 2018.
167 Meade et al., “Corn and Soybean Production Costs and Export Competitiveness in Argentina, Brazil, and the United
States,” Economic Information Bulletin No. 154, USDA, ERS, June 2016; and Ikerd J.E., “Sustaining the Profitability
of Agriculture,” In Economist’s Role in the Agricultural Sustainability Paradigm, University of Missouri, 1996,
http://web.missouri.edu/ikerdj/papers/AAE-SASA.htm.
168 Fuchs et al., “U.S.-China Trade War Imperils Amazon Rainforest,” Nature, Vol. 567, pp. 451-454.
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Appendix A.
Table A-1. Summary of China’s Retaliatory Tariffs on U.S. Agricultural Imports

Tariff Rate
Product
Tariff line
MFNa
Sept.-2018b
June-2019a
1% in-quota,
26% in-quota,
26% in-quota,
Corn
10059000
65% over-quota
90% over-quota
90% over-quota
12019010 and
Soybeans
12019020
3%
28%
28%
10011900 and
1% in-quota,
26% in-quota,
26% in-quota,
Wheat
10019900
65% over-quota
90% over-quota
90% over-quota
100610 (all grain
1% in-quota,
26% in-quota,
26% in-quota,
Rice
types)
65% over-quota
90% over-quota
90% over-quota
Sorghum
10079000
2%
27%
27%
Oats
11041200
20%
30%
40%
Barley
100390
3%
3%
3%
1% in-quota,
26% in-quota,
26% in-quota,
Cotton
52010
40% over-quota
65% over-quota
65% over-quota
Peanut (in shell and
12024100, and
shelled)
12024200
15%
20% and 25%
25% and 35%
Ch. 4 HS, except
Range 2-20%,
Range 25-40%,
Range 25-40%,
Dairy
honey
Average 11%
Average 36%
Average 37%
Honey (and
40900
15% (and 20%)
40% (and 45%)
40% (and 45%)
products)
Beef and products
2011-2023
Range 12-25%,
Range 37-50%,
Range 37-50%,
Average 15.5%
Average 40.5%
Average 40.5%
Pork and products
2031 and 2032
Range 12-22%,
Range 37-70%,
Range 37-70%,
Average 16%
Average 57%
Average 57%
Poultry and products
207 all HS lines
Range 3-20%,
Range 28-45%,
Range 28-45%,
Average 16%
Average 41%
Average 41%
Other animal
All Ch. 5
Range 2-20%,
Range 12-45%,
Range 20-45%,
products
Average 12%
Average 26%
Average 34%
Live trees, plants and
HS lines in Ch. 6
Range 10-23%,
Range 20-33%,
Range 30-48%,
cut flowers
Average 14%
Average 24%
Average 38%
Vegetables, roots and HS lines in Ch. 7
Range 0-13%,
Range 25-38%,
Range 25-38%,
tubersd
Average 11%
Average 34%
Average 35%
Fruit and nuts
HS lines in Ch. 8
Range 0-30%,
Range 25-70%,
Range 25-70%,
Average 17%
Average 53%
Average 54%
Coffee, tea and spices HS lines in Ch. 9
Range 5-20%,
Range 15-30%,
Range 20-45%,
Average 14%
Average 24%
Average 38%
Other oil seeds and
HS 12 except
Range 0-30%,
Range 11-40%,
Range 20-55%,
oleaginous fruits
peanuts, soybeans
Average 13%
Average 25%
Average 34%
Plant saps and
Range 0-20%,
Range 10-30%,
Range 18-45%,
extracts
HS lines in Ch. 13
Average 10%
Average 23%
Average 30%
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Tariff Rate
Product
Tariff line
MFNa
Sept.-2018b
June-2019a
Vegetable plaiting
HS lines in Ch. 14
Range 4-15%,
Range 20-29%,
Range 29-35%,
material
Average 10%
Average 23%
Average 31%
Range 5-30%,
Range 15-40%,
Range 20-55%,
Fats and oils
HS lines in Ch. 15
Average 14%
Average 23%
Average 36%
Prepared meat, fish
Range 15-25%,
Range 15-30%,
and seafood
HS lines in Ch. 16
5%
Average 20%
Average 24%
15% in-quota,
20-25% in-quota,
25-40% in-quota,
Sugars
HS 1701 lines
85% over-quota
90-95% over-quota
95-110% over-quota
Other HS lines in
Range 8-30%,
Range 15-40%,
Range 20-55%,
Sugar confectionery
Ch. 17
Average 21%
Average 30%
Average 40%
Cocoa and
Range 2-22%,
Range 12-32%,
Range 20-47%,
preparations
HS lines in Ch. 18
Average 11%
Average 20%
Average 33%
Cereal, flour, starch,
Range 2-10%,
Range 7-35%,
Range 12-35%,
milk preparations
HS lines in Ch. 19
Average 9%
Average 24%
Average 30%
Vegetables, fruit and
Range 5-30%,
Range 15-55%,
Range 15-55%,
nuts preparations
HS lines in Ch. 20
Average 6%
Average 26%
Average 27%
Miscellaneous edible
Range 10-25%,
Range 15-37%,
Range 20-50%,
preparations
HS lines in Ch. 21
Average 14%
Average 27%
Average 34%
Non-alcoholic
HS lines 2201 and
Range 20-30%,
Range 25-30%,
beverages
2202
5%
Average 24%
Average 29%
Food residues and
Range 0-5%,
Range 7-30%,
Range 12-30%,
feed
HS lines in Ch. 23
Average 4%
Average 16%
Average 21%
Essential Oils
HS lines in Ch.33
Range 5-20%,
Range 15-30%,
Range 15-30%,
Average 17%
Average 25%
Average 25%
Hides and skins
4101, 4102 and
Range 5-9%,
Range 10-17%,
Range 10-30%,
4103
Average 7%
Average 14%
Average 21%
Wool
51011100 and
1% in-quota, 38%
11% in-quota,
26% in-quota,
51031010
over-quota
48% over-quota
63% over-quota
Animal hair
HS 5103 lines
9%
Range 9-34%,
34%
Average 26%
Cotton waste
HS 5202 lines
10%
35%
35%
Source: CRS calculation based on: USDA, Foreign Agricultural Service (FAS), "China Raises Tariffs on U.S.
Agricultural Products", GAIN Report Number:CH19030, May 17, 2019; and American Farm Bureau Federation,
"China Tariff List," May 9, 2019, based on several FAS GAIN reports; and data from Market Access Map
(MAcMAp), International Trade Center https://marketanalysis.intracen.org/loc/Default.aspx.
Notes: HS refer to Harmonized Standard tariff code, and Ch. refers to a chapter from the U.S. Harmonized
Tariff Schedule. Average tariffs are reported in simple averages, and not in trade-weighted averages. Note that
on August 23, 2019, China further retaliated by levying additional two sets of tariffs: 5% or 10% tariffs on U.S.
imports, including 695 different U.S. agricultural tariff lines effective September 1, 2019; and another 5% or 10%
tariffs on U.S. imports including 184 different U.S. agricultural tariff lines effective December 15, 2019.
a. MFN tariff rates are tariff rates that WTO members levy on imports from other WTO members, excluding
those with whom a preferential trade agreement may exist.
b. Applied tariff rates on U.S. products as of September 2018 include MFN tariff plus any existing retaliatory
tariffs as a result of U.S. Section 301 and Section 232 tariffs on U.S. imports of Chinese products.
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c. Applied tariffs rate on U.S. products as of June 2019 include the total existing applied tariffs as of September
2018 plus any additional tariffs China levied in retaliation for U.S. implementation of increases in Section 301
tariffs announced on May 10, 2019, from 10% tariff to 25% on a range of Chinese imports of goods.
d. Many tariff lines saw 5% or 10% tariff increases in June 2019 from existing retaliatory tariffs in September
2018. Thus while the range did not change in June 2019, the average tariff levels changed. For example, the
categories: “Vegetables, roots and tubers,” “Fruit and nuts,” and “Vegetables, fruit and nut preparations.”

Author Information

Anita Regmi

Analyst in Agricultural Policy

Disclaimer
This document was prepared by the Congressional Research Service (CRS). CRS serves as nonpartisan
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under the direction of Congress. Information in a CRS Report should not be relied upon for purposes other
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