Highlights
A 10% tariff on Chinese imports into the U.S. went into effect yesterday. China said it will retaliate with a 15% tariff on U.S. coal, liquefied natural gas, a 10% tariff on crude oil, agriculture machinery, and pickup trucks. The volume of U.S. agricultural machinery exports to China is about $1 billion per year, the main exporter is the state of Iowa, with which China has established ties. Currently, Chinese tariffs affect 2-3% of total U.S. exports.
Note that soybeans and corn were not included in that list, which was a boost to soybean futures yesterday as was the weather in South America.
Also China has imposed export controls on rare earth materials used in the production of electronics. Trump said on Monday he wants Ukraine to supply the U.S. with rare earth minerals as a form of payment for financially supporting the country's war efforts against Russia.
Trump and Xi are expected to speak in the next couple days as a proposed telephone call for yesterday between them did not take place.