As President Donald Trump and the Chinese government propose new, aggressive tariffs against each other this week, California farmers are already taking a hit from the trade standoff.
The first round of China’s tariffs, in response to the Trump administration placing tariffs on Chinese steel and aluminum products, went into effect Monday. They strike at a long list of agricultural products that are big business in California’s Central Valley, including almonds, walnuts, pistachios, citrus and wine.
California farmers export between a quarter and a third of their total product each year and China is one of the top consumers, says Ryan Jacobsen, CEO of the Fresno County Farm Bureau. “They’re a major buyer of just about every product that we have,” he said. “They are one that we rely on very significantly.”
Now, farmers are waiting to see how China will react to a 15 percent price bump. Jacobsen says many are worried about losing at least some of the market in China. “But at this point we don’t know how much of that may be lost and how much of it will be absorbed.”
“We know it’s bad news, but we don’t know how bad,” says UC Davis Professor Daniel Sumner, who studies agriculture trade in Asia.
And even if the governments back off their tariffs in the coming days, some damage has already been done.
“It makes U.S. sellers seem less reliable,” Sumner said. “Not that the companies are less reliable, but there’s this intermediary that gets in the way. In this case it’s the two governments.”
The back-and-forth over tariffs seems to be heating up. On Tuesday, the Trump administration released a new list of proposed tariffs on $50 billion worth of manufacturing equipment and technology products from China. In response, China announced tariffs on $50 billion in U.S. products, including soybeans, cars and whiskey.