Tag Archives: Trade

OMAHA (DTN) — Leaders from the American Soybean Association could only respond in dismay Friday after President Donald Trump announced he was going ahead with $34 billion in tariffs against Chinese technology products because China wasted little time Friday imposing a 25% tariff on U.S. soybeans and other agricultural products.

The Trump administration announced Friday morning that it would place a 25% tariff on goods that contain “industrially significant technologies.” These include products under China’s “Made in China 2025” strategy. The U.S. can no longer tolerate losing technology and intellectual property to unfair economic practices, the White House stated. The administration also said it was preparing tariff lines on another $16 billion in Chinese goods that would be announced later this summer.

“These tariffs are essential to preventing further unfair transfers of American technology and intellectual property to China, which will protect American jobs,” the White House stated. “In addition, they will serve as an initial step toward bringing balance to the trade relationship between the United States and China.”

CHINA’S TARIFFS TO BE IMPOSED

Directing almost equal countermeasures, China’s Ministry of Commerce officials announced early Saturday in China that the country would impose 25% tariffs on $34 billion in U.S. products on July 6 on a range of products, including soybeans, but also products such as pork and chicken, as well as a list of non-agricultural products. Soybeans alone account for about roughly $14 billion in export value to China.

In the same vein as the U.S., China also stated it was preparing another round of 25% tariffs on $16 billion in U.S. products that would include chemicals, medical equipment and energy products.

The White House had stated Friday that the U.S. would pursue additional tariffs if China retaliates, “such as imposing new tariffs on United States goods, services, or agricultural products; raising non-tariff barriers; or taking punitive actions against American exporters or American companies operating in China.”

Even before China made its official announcement, commodity futures fell sharply for grains and oilseeds, though corn and wheat contracts rallied to reflect more modest daily losses. Soybeans, one of the largest U.S. export products to China, saw an early 21 3/4-cent drop in the July contract to $9.05 on the CME. The November contract fell 19 1/2 cents to $9.30. DTN’s National Soybean Index closed at $8.64 Thursday, priced 63 cents below the July contract and at its lowest price in 10 months.

Agriculture Secretary Sonny Perdue held a press call late Friday largely to talk about his trip to Canada, but he also got multiple questions about how USDA would respond to the Chinese tariffs and whether he was ready to tap into as much as $15 billion in Commodity Credit Corp. funds to help farmers. Perdue said it was important to see how the price situation plays out for farmers rather than looking at daily market fluctuations.

SEE HOW MARKET PRICES PLAY OUT

“You can’t demonstrate any damage on the day that tariffs are announced,” Perdue said. “We’re going to look at this very carefully. We’re going to calculate — we have been calculating market impact on a weekly basis on a number of months now, frankly … When we determine and if we determine there is legitimate and lasting market impact, based on market disruption of tariffs and retaliation, then we’re prepared to take action.”

The American Soybean Association used words such as “distraught” and “devastating” to express the group’s frustration, after the group twice sought meetings with Trump to highlight ways that boosting soybean exports to China could be part of a trade solution rather than resorting to tariffs. Instead, the group noted a “new anxiety” for soybean growers.

“As a soy grower, I depend on trade with China,” said Davie Stephens, vice president of ASA and a Kentucky farmer. “China imports roughly 60% of total U.S. soybean exports, representing nearly one in three rows of harvested soybeans. This is a vital and robust market that soy growers have spent over 40 years building and, frankly, it’s not a market U.S. soybean farmers can afford to lose.”

FARM BUREAU ANALYSIS

The Nebraska Farm Bureau stated its own preliminary analysis showed in 2016 that China added $2.29 per bushel of soybeans for Nebraska farmers, as well as $3.82 per head of pork and $26.36 for beef, just based on hides and skins value. On a per farm basis, China trade added an average of $16,600 per farm in Nebraska, though the value was much higher in some counties.

“While the entirety of the U.S.-China trading relationship won’t disappear overnight, these actions will have significant consequences, which have the potential to greatly damage farm and ranch families for years to come,” said Steve Nelson, president of the Nebraska Farm Bureau.

Tom Sleight, president and CEO of the U.S. Grains Council, noted that China and the U.S. have been doing this tit-for-tat since at least 2010. The U.S. has been hit with trade actions by China against sorghum, ethanol, corn and dried distillers grains. But Sleight added he is concerned tariffs will continue to open markets to other competitors at the expense of U.S. farmers. “Bottom line: Tariff battles are never productive.”

ALARM SOUNDED

Tom Donohue, president and CEO of the U.S. Chamber of Commerce, criticized the White House action in a statement, saying the Chamber has sought to sound the alarm against such actions.

“Imposing tariffs places the cost of China’s unfair trade practices squarely on the shoulders of American consumers, manufacturers, farmers, and ranchers,” Donohue said. “This is not the right approach.”

The U.S. tariffs were added to more than 1,300 tariff lines of products made in China, most of which will go into effect on July 6. The main tariff line of products, valued at roughly $34 billion, involved industries such as aerospace, information technology, robotics, industrial machinery, new materials and automobiles. Another set of products, valued at $16 billion, will undergo review and public comments before tariffs would be issued on those as well.

The Association of Equipment Manufacturers said Friday the tariffs jeopardized the industry because China constructs different types of construction and agricultural equipment. The tariffs affect U.S. companies importing equipment that is added to U.S. machinery.

“Given depressed U.S. farm incomes, the move is expected to disproportionately hurt America’s rural economy,” the group stated.

TAX ON LIVELIHOODS

Brian Kuehl, executive director of Farmers for Free Trade, a group set up to tout NAFTA and avoid trade disruption, said the White House move is “downright scary. It’s no longer a negotiating tactic, it’s a tax on their livelihoods. Within days, soybean, corn, wheat and other American farmers are likely to be hit with retaliatory tariffs of up to 25% on exports that keep their operations afloat. When they do, they’re not going to remain silent.”

Kuehl added that the tariffs are not only a loss for U.S. farmers, but a win for U.S. export competitors. “When American soybeans and corn become more expensive, South America wins. When beef becomes more expensive, Australia wins,” Kuehl said. “As this trade war drags on, farmers will rightly question why our competitors are winning while we’re losing.”

Ohio State University released a report Wednesday stating farmers in that state “could lose more than half of his or her annual net income” due to Chinese tariffs.

Farmers for Free Trade Executive Director Brian Kuehl (Keel) says the Trump Administration’s approval of $50 billion worth of imported goods from China is “scary.”

The tariffs on Chinese imports will result in heavy retaliatory tariffs negotiating tactic, it’s a tax on their livelihoods. Within days, soybean, corn, wheat, and other American farmers are likely to be hit with retaliatory tariffs of up to 25 percent on the exports that keep their operations afloat. When they do, they aren’t going to remain silent.”

Farmers for Free Trade says these tariffs are not only a blow to U.S. farmers, it’s a win for our competitors. When American corn and soybeans become more expensive, South America wins. When American beef becomes more expensive, Australia wins. As this trade war drags on, the group says farmers will rightly question why U.S. competitors are winning while American farmers are losing.

Kuehl adds, “Farmers for Free Trade will continue to hold town hall meetings across the country this summer to ensure that farmers voices are being heard. The message will be heard loud and clear. American farmers demand that elected officials support them by ending this trade war.”

LUBBOCK, Texas –A team of Mexican grain importers and feed-millers from the National Association of Food Manufacturers for Animal Consumption (ANFACA) will visit the U.S. June 18-22, 2018, to tour major sorghum growing areas, develop new relationships as well as continue to strengthen existing relationships with U.S. suppliers.

The group of buyers selected by the U.S. Grains Council represents companies from central and northern Mexico, including the state of Jalisco, the number one livestock producing state in the country, Michoacán and Sonora. Mexico is the fourth largest producer of livestock feed worldwide accounting for 33.87 million metric tons. Of this total, Jalisco, Sonora and Michoacán contribute to a combined 31 percent of overall production.

“For years, Mexico has been a valued trading partner with the United States, and the ties between U.S. sorghum farmers and Mexican importers has only grown, due in large part to the importance of the North American Free Trade Agreement,” said Tom Sleight, president and CEO of the U.S. Grains Council. “This team visit is another example of why maintaining an open line of communication is important. Mexican buyers have the opportunity to see the full U.S. sorghum value chain – from crops in the field to elevators and port facilities – and trips like these encourage continued direct sales between the two countries.”

The tour will include visits to sorghum suppliers and producers, feed mills, elevators, a rail facility, an ethanol plant and the Port of Houston. The team’s visit will focus on U.S. sorghum production, marketing and export logistics in Texas and Kansas.

“This trade mission is a great reflection of how organizations like USGC, the Sorghum Checkoff and other state organizations, such as Texas Grain Sorghum Producers and Kansas Grain Sorghum Commission, work together to build and maintain market opportunities for U.S. producers,” said Florentino Lopez, Sorghum Checkoff executive director. “These buyers will leave with a better understanding of U.S. sorghum quality and production, helping build future sales to Mexico and increasing buyer trust.”

The country of Mexico accounted for $103 million in exports of U.S. sorghum,equating to 568,254 metric tons (22.4 million bushels), during the 2016-2017 marketing year. Mexico remains one of the chief importers of U.S. sorghum, only second to China in purchases.

OMAHA (DTN) — President Donald Trump’s tirade on Twitter over the weekend aimed at Canadian Prime Minister Justin Trudeau has elevated dairy trade between the two countries to the top political issue in Canada.

Dairy was once considered a lower-rung issue in the North American Free Trade Agreement talks, but President Trump tied high Canadian dairy tariffs to his own push for steel and aluminum tariffs.

On Saturday, the president tweeted: “PM Justin Trudeau of Canada acted so meek and mild during our @G7 meetings only to give a news conference after I left saying that, ‘US Tariffs were kind of insulting” and he “will not be pushed around.’ Very dishonest & weak. Our Tariffs are in response to his of 270% on dairy!”

The president followed up with another tweet on Sunday: “Fair Trade is now to be called Fool Trade if it is not Reciprocal. According to a Canada release, they make almost 100 Billion Dollars in Trade with U.S. (guess they were bragging and got caught!). Minimum is 17B. Tax Dairy from us at 270%. Then Justin acts hurt when called out!”

Trump and leaders of the other G-7 nations, including Trudeau, have been embroiled in arguments over the White House move at the beginning of June to implement 25% tariffs on steel and 10% tariffs on aluminum. Trudeau has called the steel and aluminum tariffs “insulting.” But Trump went further, roaring on Twitter about fair trade and dairy tariffs.

The U.S. held a dairy trade surplus with Canada in 2017 that ran anywhere from $113 million to $521 million, depending on the math of different agencies and trade associations.

Canada and the U.S. both use tariff-rate quotas to allow trading partners to export a certain volume of cheese, butter fat, butter milk, dry milk, cream, yogurt, whey products and ice cream at lower tariffs. Then the tariff volumes spike once the quota limit is reached. In Canada, once those quotas are reached, tariffs can reach as high as 294% for some products. The 270% number President Trump uses comes from blended dairy powder over the tariff-rate quota, which is 3% for the U.S., according to Canada’s customs tariffs schedule. https://goo.gl/…

Following the trade rhetoric over the weekend, the leaders of the National Farmers Union and Canadian Federation of Agriculture issued a joint statement noting the two countries have more than $40 billion in annual agricultural trade between them, a dollar figure that continues to climb. And farmers in both countries need the certainty that comes from that trade, the groups stated.

“No heated rhetoric nor inflammatory remark could possibly represent the positive sentiment that American and Canadian farmers share for each other’s nation. We urge our respective officials to engage in positive discourse that protects the strong trade ties that benefit American and Canadian farmers alike.”

The National Milk Producers Federation responded to DTN regarding comments from the president and his advisers.

“We appreciate President Donald Trump’s acknowledgement that Canada has not treated our farmers fairly,” NMPF stated. “However, we do not believe that some of the language used by some White House officials was appropriate to describe this strong disagreement with Canada on trade policy. We agree that we need to express to Canada that trade needs to be a two-way street, and we are prepared to do it respectfully, but forcefully and with determination.”

Canadian dairy producers dug in. Pierre Lampron, president of Dairy Farmers of Canada, said his group and all Canadians reject the White House’s personal attacks on Trudeau. Lampron maintains the U.S. has a 5-to-1 dairy trade surplus with the U.S., and based on market studies, 10% of the Canadian dairy market is open tariff-free while only 3% of the U.S. market is open, Lampron said.

Canadian dairy farmers, who are politically influential in the country, “are concerned by the sustained attacks by President Trump with an aim to wiping out dairy farmers here at home,” Lampron said.

“The root of the U.S.’ problem is that they are producing too much milk in an oversaturated world market,” he said. “Canada already produces enough milk to fill Canadian demand. As Canada has less population than the state of California, and that Wisconsin alone produces more milk than all Canadian farms combined, clearly, the Canadian market is too small to make a dent in U.S. overproduction.”

It’s hard to get a handle on actual dairy trade between the two countries. A Bloomberg article Monday cites that the U.S. exported $227 million in dairy products to Canada last year while Canadian dairy producers exported $114 million to the U.S., according to Statistics Canada. https://goo.gl/…

The U.S. Dairy Export Council cites that Canada was the third-largest market for U.S. dairy products in 2017, buying $636 million in products, up 1% from 2017.

But the U.S. Dairy Export Council also says people cannot just rely on the numbers posted on its website. That’s because the Canadians demand most of the dairy products exported to Canada from the U.S. are required to be processed and re-exported, rather than used on the domestic market. So the real “export” volume to Canada is not actually known. https://goo.gl/…

After pointing out that the USDA export charts on the USDEC website don’t tell the whole story, Jaime Castaneda, senior vice president of trade policy for USDEC, said, “We want to have the same fair trade that 99% of agriculture has with Canada.”

Trump’s continued focus on Canadian dairy tariffs comes as overall U.S. dairy exports are surging as well. March and April were record months for U.S. dairy exports, according to the U.S. Dairy Export Council. Much of the export growth is driven by higher product exports to China, Mexico, Southeast Asia and South Korea. https://goo.gl/…

Canada’s Dairy Information Centre states Canada exported 137.1 million pounds of dairy products to the U.S. in 2017, a 32% increase from 2016, driven mainly by a spike in yogurt and whey products. Those sales were valued at $115 million in U.S. dollars, up from $86.7 million in 2016.

Comparatively, dairy trade ranging somewhere from $341 million to $751 million between the two countries still comes down to one-tenth of 1% of trade volume between the U.S. and Canada last year. U.S. exports to Canada were $341.2 billion in 2017 while Canadian exports to the U.S. were $332.8 billion.

Canada’s dairy production with 941,800 milking cows would make it the third-largest dairy state in the U.S., behind California with 1.8 million head and Wisconsin with 1.28 million milking cows. Nationally, the U.S. has about 9 million milking cows. To keep Canada’s dairy producers operating and largely profitable, Canada has a supply management system that it is increasingly determined to defend in the NAFTA talks.

The U.S. operates with programs such as the Margin Protection Program, which was revamped this spring because farmers and lawmakers determined the safety net wasn’t strong enough. Based on the latest enrollment figures, USDA expected to issue roughly $90 million in checks this week to more than 20,000 dairy farmers because of MPP prices for the months of February, March and April.

The debate over Canadian dairy and its supply management system comes as Wisconsin Gov. Scott Walker announced last week that his state is creating a new dairy task force to make recommendation that would help the viability and profitability of dairy in his state. Walker modeled the proposal after a similar task force created in Wisconsin in 1985.

“Dairy farmers are facing challenges due to an extended period of low milk prices and market uncertainty,” Walker said. “By creating this task force, industry experts can work together to create real solutions that can help our farmers, processors, and allied organizations, and to ensure that our dairy industry is not only our past, but our future.”

Meanwhile, dairy farmers in states such as Wisconsin and Michigan are actually learning more about how the Canadian supply management works and asking why the U.S. can’t look at a comparable model. Michigan Farmers Union will host meetings later this week in Michigan with Canadian dairy farmers.

LINCOLN, Neb. —  Trade talk dominated the World Meat Congress as more than 700 attendees from more than 40 different countries met in Dallas, Texas from May 30–June 1 to discuss the obstacles producers are facing.

Ed Lammers, of Hartington, Neb. was one of those attendees. A United Soybean Board member, Nebraska Soybean Board ex-officio and U.S. Meat Export Federation executive committee member, Lammers noted this was the first time the World Meat Congress had been held in the United States in 20 years.

Throughout the course of the congress, Lammers had conversations with an Irish ambassador, a German journalist and a British geneticist about trade concerns and cultural perceptions of producers.

He said his biggest takeaway came from a Mexican trade representative.

“As producers, we need to continue to voice our concerns to the industry, and to do so boldly,” Lammers said. “I thought that carried a lot of weight and opened up a lot of ears.”

Speakers at the congress also covered technology, branding, economics, industry trends and science-based production.

Lammers said there was a focus on producing enough food for the growing global population and urged soybean farmers to support animal agriculture with their product.

“As U.S. producers, it should be our moral prerogative to produce food for the world, while keeping sustainability in mind,” Lammers said.

As new tariffs on steel and aluminum imports go into effect for some of the United States’ closest allies, the U.S. grains industry is watching closely for retaliations that impact sales of U.S. corn, sorghum, barley and their related products, including ethanol and distiller’s dried grains with solubles (DDGS).

U.S. Commerce Secretary Wilbur Ross confirmed on Thursday that discussions to continue extensions of tariff waivers for Mexico, Canada and the European Union – three of the largest markets for U.S. grains and related products – had failed. As of June 1, they will join a large group of countries facing new tariffs of 10 percent on aluminum imports and 25 percent on steel imports, applied under Section 232 of U.S. trade law.

At press time, it appeared neither Mexico nor Canada had added feed grains or ethanol to their initial retaliation lists, though it is expected those lists will evolve as trade tensions ramp up. The European Union previously announced its countermeasures would include a 25 percent tariff on both U.S. feed and sweet corn, which is largely blocked due to biotechnology concerns. Several other U.S. agricultural products were implicated, including some pork products going to Mexico and a variety of specialty crops. Yogurt and various prepared foods were among the agricultural and food products targeted by Canada.

“Based on information we have heard from our customers and past experience, we have every reason to believe U.S. agriculture, including the products we represent, will be among the most vulnerable to countermeasures from our trading partners,” said U.S. Grains Council President and CEO Tom Sleight in a statement.

“We had strong hopes this situation would be averted permanently, but it now appears we need to prepare for retaliation and its direct impact U.S. farmers. Our global staff is doing this to the best of their abilities as we continue to follow new developments.”

Many countries are already facing the new tariffs, which initially went into effect in March. Those include China, which on April 2 counter-imposed tariffs of 15 percent on imported U.S. ethanol and 25 percent on imported U.S. pork. Japan, Turkey, Russia and India also face the tariffs and have said they would retaliate but have not issued lists or their lists did not include U.S. grain products. Quota agreements on steel and aluminum to stave off tariffs have been reached with South Korea, Australia, Argentina and, tentatively, Brazil.

The Section 232 tariffs are in addition to tariffs proposed under Section 301 of U.S. trade law, particularly targeted at China, and a plethora of other trade policy issues, negotiations and concerns.

For the latest, follow the Council here.

Regardless whether you’re a Republican, Democrat, Libertarian or a card-carrying Mugwump, I think we can all agree that President Donald Trump is a man not afraid to change his mind. Of course, that’s not to say that everyone would characterize this unique flexibility in the same way.

What strikes some as being open-minded, hits others as being empty-headed. What speaks to some as strategic deal making, warns others of random cluelessness. What some admire as bold examples of leadership, others fear as reckless and counterproductive displays of power.

Furthermore, many members of the citizen jury flip their verdicts from morning tweet to morning tweet. Our wonderful country can often be a tough bar to manage with the head bouncer facing intractable problems on a daily basis. Reassessments can be good or bad, absolutely necessary or dangerous second-guessing.

No less a thinker than Ralph Waldo Emerson once said: “A foolish consistency is the hobgoblin of little minds.” Whatever else fans and critics might think of the commander-in-chief’s gray matter, it is clearly not haunted by ghosts of uniformity and steadfastness.

But while I’m glad President Trump is not demonically possessed by an irrational need to strictly “stay the course” for its own sake, I am increasingly troubled by the reckless way he likes to shoot from the hip in matters of global trade.

The seeds of mistrust now being sown among many of our major trading partners makes me wonder if the White House truly understands the evolutionary nature of the international marketplace, a networking process that slowly improves over time as “non-zero” relationships (i.e., net import and export sums that benefit both sides of a trade) proliferate and compound.

But if this criticism is too harsh on the Trump administration, I feel more confident in saying that the president and his entire motley crew (given the extremely short truce in the trade war with China declared just last week, it seems clear that not every team member is rowing in the same direction) could benefit from a season or two of demanding fieldwork and farm management.

As far as I’m concerned, the great and abiding ethos of agricultural marketing has always been summarized by the pledge “my word is my bond.” Many may think this sounds quaint and unrealistic. But I still think it’s the fundamental nail that guarantees 95% or more of the country’s farm business.

That’s not to say that no one in the farming and ranching community ever bothers with lawyers and contracts. Of course, successful producers follow prudent business practices. And that’s not to say that all those who work the soil or sort cattle automatically turn into unimpeachable Eagle Scouts. Bad apples fall from rural and urban orchards alike.

Nevertheless, I would have no qualms testifying before Congress (or perhaps more to the point, chatting over drinks at Mar-a-Lago) about agriculture’s extraordinarily high commitment to honor and trust in matters of commerce. Maybe I’m hopelessly naive. But I’ve seen too many unhedged farmers dutifully deliver contracted corn dollars under the spot market and too many unhedged feedlot managers accept delivery on fall calves tens of dollars above the spot market to think otherwise.

Although waves of consolidation and concentration have certainly changed some of the dynamics of agricultural business over the decades, an amazing network of trust and cooperation still exists in the country. This network’s taproot is comprised of realities such as isolation, low population, piecemeal infrastructure, and scattered markets.

The magic of this necessary trust at first fostered the rising levels of trade required to feed and energize the continental United States. This same quality of trust was then increasingly married to hundreds of other trusting business partners all around the world to create global trade worth trillions and trillions of dollars.

Unfortunately, this long-tested alchemy of trust and trade, a proven elixir responsible for the creation of untold wealth through U.S. agriculture, as well as the nation as a whole, is being threatened by a president who believes that trade wars are good and easily won.

Can’t you just hear our trading partners say something like “Anyone so casually bellicose is not to be trusted.” And that’s exactly the point. Trust and trade go together like love and marriage. Once you become less than trustworthy, your sex appeal as a trading partner quickly goes south.

During less than 18 months in office, President Trump has reneged (or threatened to renege) on U.S. international pledges too numerous to count. Some of these decisions may have been well-reasoned. But the way the president and his team blow hot and cold (sometimes on the same day), is it any wonder that U.S. creditability seems to be approaching an all-time low.

Maybe if Trump had been raised in the wilds of western Nebraska or Kansas instead of cushy New York, he would have learned one of the woodshed’s most valuable lessons: “Say what you mean, and mean what you say.”

U.S. Commerce Secretary Wilbur Ross will be in China June 2-4 for another round of talks amid trade tensions between the world’s two largest economies.

Reuters says the trade dispute got a little more complicated this week when President Donald Trump announced a national security investigation into imports of cars and trucks. The probe could possibly result in tariffs against China, as well as against key U.S. allies like Germany, Canada, Japan, and Mexico.

Treasury Secretary Steven Mnuchin  says Ross will be looking to negotiate a framework that could turn into binding agreements between companies. The constructive comments from both the U.S. and China after the last round of talks eased fears of a trade war between the countries. However, President Trump said this week that any deal would need a “different structure,” fueling yet more uncertainty over negotiations.

Trump threatened to impose $150 billion worth of tariffs on Chinese goods, fueling threats of equal retaliation from Beijing, including tariffs on large U.S. imports like soybeans.

The National Sorghum Producers welcomed news that the 178 percent tariff and anti-dumping and countervailing duty investigations were dropped. Trade talks between the two countries continued this week, showing signs that China has promised to help reduce the trade surplus by purchasing more U.S. agriculture and energy products. There are many questions being raised about those logistics, and details around the timeline and amount of increased purchasing are still looming. USDA officials have been working closely with the Trump Administration to provide information on potential products that China could buy. President Trump is pushing a $25 billion increase on U.S. agricultural products. NSP Remains engaged in these discussions and is cautiously optimistic, knowing there are a lot of ups and downs possible as negotiations continue the 1st week of June.

Sources close to the White House tell Bloomberg that President Donald Trump backed off imposing billions of dollars in tariffs on Chinese goods because of discord within the administration.

There’s also concern within the White House over the possibility of harming negotiations with North Korea. Trump also reportedly succumbed to pressure from farm-state Republicans, who heavily lobbied the administration to settle its differences with China, which had threatened to levy its own tariffs on American agricultural imports.

Treasury Secretary Steven Mnuchin  said over the weekend that the administration’s plan to impose tariffs on Chinese goods has been suspended. However, former Trump chief strategist Steve Bannon told Bloomberg the deal was “capitulation.” Some White House officials say the retreat on tariffs is a result of discord on Trump’s economic team.

Bloomberg says divisions are raw between free trade supporters like Mnuchin and White House Economic Adviser Larry Kudlow and the China hawks led by White House trade adviser Peter Navarro. Mnuchin and Navarro were said to have argued over China policy during a trip to Beijing earlier this month, and Navarro wasn’t as deeply involved during negotiations last week with a Chinese delegation that made a trip to Washington, D.C.