To Appease Trump, China Offers To Buy $70BN In Farm And Energy Goods

The Wall Street Journal gave the market some good news amid rising concerns about Italy and trade wars, when it reported that in an attempt to appease Trump, over the weekend Beijing had offered to buy US farm and energy products in a trade package worth an estimated $70 billion.

The team of Chinese envoys - led by Vice Premier Liu He, President Xi Jinping's top economic official - offered a US team headed by Commerce Secretary Wilbur Ross a package that involved Chinese companies buying more US soybeans, corn, natural gas, crude oil and coal among other agricultural and energy products. Stocks briefly rallied on the news, but the gains then quickly faded as the market realized this was nothing more (or less) than prior such gambits offered by China.

China's voluntary proposal comes as president Trump pushes China to commit to reduce the $375 billion US merchandise-trade deficit with China by $200 billion, and while the $70 billion package would help move the US toward that goal, it would be rather insufficient.

Ross

Also diluting the Chinese offer, Liu explained that the package would be void if Washington proceeded with plans to impose tariffs on $50 billion in China-made products.

WSJ also points out that US officials are skeptical of the offer for several reasons, including the fact that the US likely wouldn't be able to ramp up agricultural production quickly enough. As of last week, the White House said it would move ahead with tariffs and sanctions restricting China's access to US technology and the US market while punishing Beijing for its purportedly unfair trading practices. If accepted, the offer would benefit the farm-belt states that voted heavily for Trump during the election.

China also offered to get state-owned companies to buy more US natural gas, though that could also be subject to production difficulties. 

"Nothing has firmed up yet," one official said. "It would require additional rounds of discussions between the two sides."

It's unclear whether the Trump administration will take the offer seriously, although judging by the market reaction, the early answer is no.

Comments

Robert A. Heinlein Tue, 06/05/2018 - 11:45 Permalink

This is going to upset the anti Trump tards. He just refuses the follow the play book they want him to. While I don't think this is over by a long shot, at least they are talking and moving in a good direction. Say what you want, but Trump is right about tariffs as a bargaining chip. We'll see if this works on not. So far, Trump: WINNING 

Robert A. Heinlein DingleBarryObummer Tue, 06/05/2018 - 12:13 Permalink

I agree with a lot of what you say. They have a different philosophy in so many things and business is one for sure. But they are also pragmatist. They know we got the power here. Dispite what the lame stream media says, our economy is the big dog. We bark they listen. Up till now, we've had a bunch of idiots with their tail between the legs begging the Chinese to let us in all the while they steal our tech and force us to play by their rules.   They've taken full advantage. Trump has dealt with them in business, so he know all this.  Notice they keep coming back giving a little.  Let this play out. He know what he's doing dispite the anti Trump tards frothing.  I love it.  

In reply to by DingleBarryObummer

CashMcCall Robert A. Heinlein Tue, 06/05/2018 - 13:25 Permalink

The US has no power here. Trump Tariffs have backfired across the board and now the USA is on the brink of shooting its own Dollar Reserve Currency in the head. Not one steel or aluminum maker in the US backs trump on tariffs. Only the scumbag UNIONS... they have destroyed 90% of all US manufacturing. None of this works when the economy is a hollow core of nothing but climbing debt. NAFTA negotiation are code for yet another GM Bailout. Unions have destroyed the US. All you get from TrumpStupid is the "privilege" to pay some union slobs bar tab and higher taxes in the form of Tariffs. The only thing you have at the end of the Trump Grifter Rainbow is a pot of debt. 

 

 

In reply to by Robert A. Heinlein

Robert A. Heinlein Mimir Tue, 06/05/2018 - 12:04 Permalink

What?!  You are so wrong in so many ways. World is not laughing. If you said pissed off I'd agree. They sure as hell are not laughing. He don't care wtf they say and I'm with him. Just because you don't see how they have taken advantage of us all these years says more about you. Friends like that, who needs enemies.  Trump has taken the bull by the horn. Only fool I see are the anti trump tards. Fuck international law.  Joke. 

In reply to by Mimir

Winston Churchill Robert A. Heinlein Tue, 06/05/2018 - 12:17 Permalink

The USA just printing up money and them supplying real things for it surely is being taken advantage of,

but it not them doing the ripping off.

Everything that's happened is the consequence of that exhorbitant privilege and bankers greed.Triffins paradox.

Tinkering around the edges solves nothing unless you deal with the root cause.

You are angry at the wrong target,as was planned.

In reply to by Robert A. Heinlein

Robert A. Heinlein Winston Churchill Tue, 06/05/2018 - 12:36 Permalink

No anger. Reality. If I was one of the companies whose technology was ripped off, then I'd be angry. And why are you not angry they charge 25% tariffs on our goods?  Does that not bother you at all?  Free trade is a false flag. Bankers don't run China for your info. It's a Communist country, that does not get mentioned. Bankers run nothing there. Fact. Now if you said the bankers were funding the build up and militarization of the South China Sea, I'd agree. You need to get up to speed. 

In reply to by Winston Churchill

Consuelo Robert A. Heinlein Tue, 06/05/2018 - 13:13 Permalink

Do you have a memory of what transpired during the Clinton presidency...?

Were the corporations who participated in the then nascent and now fully assimilated offloading of our manufacturing base, along with Congressional blessing and Clinton's MFNS for China, all forced at gunpoint to engage in their version of realpolitik...?

'Get up to speed'?

Indeed Sir...

In reply to by Robert A. Heinlein

tmosley Mimir Tue, 06/05/2018 - 12:13 Permalink

>his 25/10% tariffs are illegal according to international laws

They're more like "guidelines".

>He has just created a World filled with critics and ennemies

Just now? Hahahahaha

>At least he makes World leaders laugh of America although they all know that the US does not deserve a fool like that as President

I can tell you are from a shithole country.

In reply to by Mimir

hola dos cola CashMcCall Tue, 06/05/2018 - 16:18 Permalink

Misunderstanding... The Chinese should boycot American oil and buy more from the other stuff. The hoofed one ('s father and your own banks) set the current situation up to collapse your oil industry. But second time it pans out differently than intended (in beween the planes -which worked-, and they're lovers now - 'collaboratively' working it-). Faith has it though the Chinese have come into the position to finish it, right about now.

But Chump goes...

(have the saudi admitted and have they been ... forgiven, perhaps? If not there is a word for that, isn't there?)

... asking the hoofded one for help, while selling the strategic reserve and trying to outcrowd the competition on destination Europe.

The Chinese have loaded up and could prevent your industry ever making a buck because it would collapse before you were knee deep in the abundant and cheap WTI stuck in the plaines.

(tra.., trai, trait.... hm?)

It would take the next generation's college money to keep it up.  'Mr Bump goes messing with the markets' and the banks come collecting from you. Free market (for some and in the other meaning)

In reply to by CashMcCall

SergeA.Storms Tue, 06/05/2018 - 11:59 Permalink

The big moves are yet to come. $70 Billion is a step toward that $800 Billion number.  Almost 1/10th of the way there.  If they hit $400 Billion by the time of agreement I think that is a win.  Am I seeing this wrong?  In a perfect world it would be fair trade, but there are so many variables.

not-me---it-wa… Tue, 06/05/2018 - 12:00 Permalink

china makes lotsa cheap stuff the 'merkan consumer wants.  going the other way, what does the us make that china wants?

there's high tech, but no.....export restricted.  ok, china offers to buy more oil and ag stuff.  sorry, we can't fulfill the order.

how is this winning?