China dropped its anti-dumping probe into imports of USA sorghum on Friday, beating a hasty retreat from a dispute that wreaked chaos across the global grain market and raised concerns about rising costs and financial damage at home.
The Chinese Commerce Ministry said Friday the investigation, which started in January, found that imposing anti-dumping duties on USA sorghum would increase living costs for Chinese consumers. China has responded by focusing on $50 billion in US imports.
The probe had sparked concerns among American farmers that they might lose their largest export market for the crop.
The ministry now says that such a measure would particularly hit Chinese livestock breeders struggling to make ends meet as domestic pork prices fall. Neither country has yet imposed tariffs.
The US shipped 4.8 million tons of sorghum to China previous year, compared with 317,000 tons in 2013. Authorities imposed preliminary anti-dumping tariffs of 178.6 p.c final month on the crop, which is used primarily for animal feed and liquor.
Yet the average price per ton dropped 31 percent during the same period, which also caused a steep decline in prices of Chinese sorghum.
Liu called on US President Donald Trump at the White House yesterday.
North Korea threatens to cancel Trump summit
In 2003, Libya negotiated sanctions relief from the United States in exchange for renouncing its nascent nuclear program. Xi was quoted as saying by state broadcaster CCTV.
"China is taking some goodwill measures", said one trader at an global company having soybean processing plants in China.
"Now they are showing goodwill by halting its anti-dumping investigation into sorghum imports, but it is a cheap way of showing goodwill as the US doesn't have much sorghum left to export. The next United States sorghum crop will be harvested in August", he told the news agency Reuters.
China denied on Friday that it had offered a package to slash the US trade deficit by up to $200 billion. China vowed to retaliate, targeting American exports worth $50 billion.
The move was seen as a goodwill concession as Chinese Vice Premier Liu He was in Washington for talks aimed at resolving trade tensions between the world's two largest economies. The news brought some unexpected relief to Chinese buyers who still had cargoes stuck at ports.
The announcement on sorghum imports came from the Commerce Ministry in Beijing on Friday morning, and was not explicitly linked to the trade talks. Trump instructed reporters that he had doubts concerning the potential for an settlement.
Economists say it is far from clear how China could achieve a $200 billion reduction in the trade deficit with the United States - unless US exporters, already running at or near full capacity, were to divert goods destined for other countries to China instead, a development that would only shift trade flows and not cut the global USA deficit.