{"id":59256,"date":"2025-08-13T11:32:03","date_gmt":"2025-08-13T06:02:03","guid":{"rendered":"https:\/\/vajiramandravi.com\/current-affairs\/?p=59256"},"modified":"2025-08-13T11:32:03","modified_gmt":"2025-08-13T06:02:03","slug":"behind-us-china-trade-truce-tariffs-agriculture-rare-earths-in-play","status":"publish","type":"post","link":"https:\/\/vajiramandravi.com\/current-affairs\/behind-us-china-trade-truce-tariffs-agriculture-rare-earths-in-play\/","title":{"rendered":"Behind US-China Trade Truce: Tariffs, Agriculture &#038; Rare Earths in Play"},"content":{"rendered":"<h2><b>US-China Trade Truce Latest News<\/b><\/h2>\n<ul>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">US President Donald Trump has extended his trade truce with China until November 10, 2025, delaying the imposition of a 145% tariff on Chinese goods and maintaining it at 30% as per a previous order.\u00a0<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">This pause follows Beijing\u2019s countermeasures, which included initially imposing a 125% tariff on US imports (later reduced to 10%) and restricting exports of rare-earth metals crucial for US industries like automotive, aerospace, defence, and semiconductors.\u00a0<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">China has also leveraged its agricultural imports, drastically reducing purchases of US farm produce \u2014 from $13.1 billion in January\u2013June 2024 to $6.4 billion in the same period of 2025, continuing a multi-year decline from a peak of $40.7 billion in 2022.<\/span><\/li>\n<\/ul>\n<h2><b>Background to the Extension<\/b><\/h2>\n<ul>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">The United States and China have agreed to prolong their trade truce for another 90 days, just hours before mutual tariff hikes were set to take effect.\u00a0<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">This pause kept US tariffs on Chinese imports at 30%, while China maintained a 10% duty on US goods.\u00a0<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">Earlier in the year, both sides had threatened triple-digit tariffs, with Washington planning levies up to 145% and Beijing up to 125%, before scaling back during May talks in Geneva.<\/span><\/li>\n<\/ul>\n<h3><b>Objectives of the Extension<\/b><\/h3>\n<ul>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">According to the White House, the delay allows more time to address trade imbalances, unfair trade practices, and national security issues.\u00a0<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">The US cited a $300 billion trade deficit with China in 2024.\u00a0<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">Negotiations will focus on increasing market access for US exporters, lifting trade restrictions, and stabilising the global semiconductor supply chain.<\/span><\/li>\n<\/ul>\n<h2><b>Key Trade Issues<\/b><\/h2>\n<ul>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">Ongoing discussions cover <\/span><b>access to China\u2019s rare earths, purchases of Russian oil, and US technology export curbs<\/b><span style=\"font-weight: 400;\">.\u00a0<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">Recently, Trump allowed companies like AMD and Nvidia to resume certain chip sales to China in exchange for 15% of revenues \u2014 a move criticised as a \u201cshakedown.\u201d\u00a0<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">Additionally, the US is pressing for TikTok\u2019s separation from Chinese parent ByteDance, a step opposed by Beijing.<\/span><\/li>\n<\/ul>\n<h2><b>China\u2019s Agricultural Import Leverage in US-China Trade Dispute<\/b><\/h2>\n<ul>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">China has strategically slashed its agricultural imports from the US, especially soyabeans, which fell to just $2.5 billion in January\u2013June 2025 from $17.9 billion in 2022.\u00a0<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">Other US exports hit include corn, barley, cotton, beef, pork, poultry, tree nuts, and forest products.\u00a0<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">As the world\u2019s top importer of key agri-commodities, China now sources much of its soyabean, barley, and corn from Brazil, Argentina, Canada, and others, bypassing US suppliers.\u00a0<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">This shift impacts American farmers across the \u201ccorn belt\u201d and livestock producers in states like Texas, Oklahoma, and California.\u00a0<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">Alongside its <\/span><b>dominance in rare-earth elements<\/b><span style=\"font-weight: 400;\">, <\/span><b>China\u2019s buying power in the global agri-market<\/b><span style=\"font-weight: 400;\"> is a potent tool to pressure the US administration into maintaining trade talks and avoiding tariff escalation.<\/span><\/li>\n<\/ul>\n<h2><b>India\u2013US Agricultural Trade Surges Amid US\u2013China Decline<\/b><\/h2>\n<ul>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">While US farm exports to China plunged 51.3% in January\u2013June 2025 compared to the same period in 2024, shipments to India rose by 49.1%.\u00a0<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">Bilateral agricultural trade between India and the US is thriving, with <\/span><b>US exports to India expected to exceed $3.5 billion and Indian exports to the US likely to top $7.5 billion this year<\/b><span style=\"font-weight: 400;\">.\u00a0<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">India has overtaken China as the largest market for US tree nuts, importing over $1.1 billion worth in 2024 and $759.6 million in just the first half of 2025.\u00a0<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">The US also holds a 35% share in India\u2019s seafood exports, especially frozen shrimps and prawns worth $1.9 billion in 2024\u201325.\u00a0<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">Despite this robust exchange, the Trump administration has doubled tariffs on Indian imports to 50% from August 27, including a 25% penalty for purchasing Russian oil \u2014 a move not applied to China despite similar purchases.<\/span><\/li>\n<\/ul>\n<p><b>Source:<\/b> <a href=\"https:\/\/indianexpress.com\/article\/explained\/explained-economics\/behind-us-china-trade-truce-10185535\/\" target=\"_blank\" rel=\"nofollow noopener\"><span style=\"font-weight: 400;\">TH<\/span><\/a><span style=\"font-weight: 400;\"> | <\/span><a href=\"https:\/\/www.bbc.com\/news\/articles\/cg7jjkvzmkxo\" target=\"_blank\" rel=\"nofollow noopener\"><span style=\"font-weight: 400;\">BBC<\/span><\/a><\/p>\n","protected":false},"excerpt":{"rendered":"<p>Explore the US-China trade truce\u2019s 90-day extension, its tariff impacts, and strategic battles over rare earths and agriculture.<\/p>\n","protected":false},"author":18,"featured_media":59274,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[18],"tags":[60,22,59,2161],"class_list":{"0":"post-59256","1":"post","2":"type-post","3":"status-publish","4":"format-standard","5":"has-post-thumbnail","7":"category-upsc-mains-current-affairs","8":"tag-mains-articles","9":"tag-upsc-current-affairs","10":"tag-upsc-mains-current-affairs","11":"tag-us-china-trade-truce","12":"no-featured-image-padding"},"acf":[],"_links":{"self":[{"href":"https:\/\/vajiramandravi.com\/current-affairs\/wp-json\/wp\/v2\/posts\/59256","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/vajiramandravi.com\/current-affairs\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/vajiramandravi.com\/current-affairs\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/vajiramandravi.com\/current-affairs\/wp-json\/wp\/v2\/users\/18"}],"replies":[{"embeddable":true,"href":"https:\/\/vajiramandravi.com\/current-affairs\/wp-json\/wp\/v2\/comments?post=59256"}],"version-history":[{"count":0,"href":"https:\/\/vajiramandravi.com\/current-affairs\/wp-json\/wp\/v2\/posts\/59256\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/vajiramandravi.com\/current-affairs\/wp-json\/wp\/v2\/media\/59274"}],"wp:attachment":[{"href":"https:\/\/vajiramandravi.com\/current-affairs\/wp-json\/wp\/v2\/media?parent=59256"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/vajiramandravi.com\/current-affairs\/wp-json\/wp\/v2\/categories?post=59256"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/vajiramandravi.com\/current-affairs\/wp-json\/wp\/v2\/tags?post=59256"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}