It added that Chinese authorities hoped that “the US will honour its word and fulfil its promises to create favourable conditions for cooperation for the two countries in the agriculture sector”.
Hua Changchun, an economist at Guotai Junan Securities, a brokerage, said Beijing’s move has increased the likelihood of a narrow trade deal.
“But it’s a small deal,” Hua said. “It means that there would be no escalation of tariffs as China has agreed to make more purchases. It could provide a certain level of comfort to US farmers and give Trump something to brag about.” It marks the latest in series of rapid-fire developments this week that suggest a concerted effort by China to push for a partial, or interim, trade deal.
It also comes just hours after Reuters reported that private buyers in China bought “at least 10 boatloads of US soybeans on Thursday”, the biggest mass purchase since June.
China’s Ministry of Commerce had not responded to a request for confirmation of exactly what the exemption would look like, with Friday being a public holiday in mainland China.
However, both pork and soybeans have been subject to heavy duties, imposed during successive rounds of Chinese tariffs on US goods.
China has also imposed 30 per cent in tariffs on yellow soybeans – the sort the US grows in abundance – including 25 per cent in June and 5 per cent on September 1, bringing the current tariff level to 33 per cent. If the additional tariffs are removed, tariffs on US soybeans would return to 3 per cent – the same rate paid by importers of Brazilian soybeans, which have largely filled the gap left by the US.
It is expected that China will be buying large amounts of our agricultural products!— Donald J. Trump (@realDonaldTrump)
Trump said on Thursday he preferred a broad deal, though he left open the possibility of a limited version when asked whether he would agree to an interim deal.
“A lot of people are talking about, and I see a lot of analysts are saying: an interim deal, meaning we’ll do pieces of it, the easy ones first,” Trump told reporters. “But there’s no easy or hard. There’s a deal or there’s not a deal. But it’s something we would consider, I guess.”
Earlier in the week, China had exempted 16 categories of US products – including medicines – from import tariffs.
Liu He, China’s lead trade negotiator and the top economic aide to President Xi Jinping, welcomed Trump’s postponement in a Thursday meeting with Evan Greenberg, president of the US-China Business Council, a lobby group.
Liu said working level trade meetings would take place next week to pave the way for the October meeting of top trade officials, who will focus on issues of “trade balance, market entry and investor protection”. This suggests the negotiations would be mainly about trade and investment issues instead of structural changes in Chinese economy or security.
“The whole world is expecting to see progress in China-US negotiations,” Liu said.
Shen Jianguang, chief economist at JD Digit and a veteran Chinese economy watcher, said neither side is in the mood for a further escalation of the trade dispute.
“The US could step back a bit on tariffs and China could offer to buy more US farm products,” Shen said. “However, it will still be difficult to reach a broad agreement over structural issues.”