Tariff threats ‘troubling’

| April 5, 2018

A trade war between the US and China could have a devastating impact on North Carolina’s tobacco growers, according to a story by Brian Murphy and Zachery Eanes for the News & Observer.

North Carolina exported leaf tobacco worth more than $156 million to China last year, making China the biggest national consumer of the state’s tobacco.

However, the value of North Carolina’s tobacco exports to China was already down – from more than $184 million in 2015 and $166 million in 2016 – when, on Wednesday, China announced plans to impose higher tariffs on more than 100 US products, including tobacco.

Tariffs on unmanufactured tobacco would be raised from 10 percent to 35 percent, while duties on cigarettes and cigars would be pushed up from 25 percent to 50 percent, according the US Department of Agriculture.

The tariffs are only proposals at this time and would not go into effect until at least the middle of May, leaving time for negotiations between the two nations.

Zippy Duvall, president of the American Farm Bureau Federation, urged the nations to negotiate and “produce an agreement that serves the interests of the world’s two largest economies”.

Meanwhile, Larry Wooten, president of the North Carolina Farm Bureau, said the situation was troubling, to say the least, in relation to tobacco. “When you add pork and soybeans, it really hits North Carolina,” he added.

In addition to being the US’ largest producer of tobacco, North Carolina plants 1.6 million acres of soybean.

In total, North Carolina exported $2.3 billion in goods to China in 2016 up from $1.4 billion in 2006, according to the US-China Business Council. China was the state’s third-largest trading partner after Canada ($6.2 billion in goods) and Mexico ($3.1 billion).

The News & Observer story is at: http://www.newsobserver.com/news/politics-government/politics-columns-blogs/under-the-dome/article207952919.html.

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Category: Breaking News, Leaf, Markets, Tax

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