China suspends US farm imports, mulls sanctions

China confirms it has suspended buying US agricultural products and is mulling tariffs of its own.

Workers walking past imported soybeans at a port in Nantong in China's eastern Jiangsu province. Picture: AFP

China has suspended purchases of US agricultural products in response to US threats to impose tariffs worth billions on more in Chinese goods.

The Chinese Commerce Ministry said early on Tuesday that China “will not rule out” putting tariffs on US agriculture imports purchased after 3 August, two days after US President Donald Trump declared he would impose 10 per cent tariffs on $US300 billion in Chinese imports.

China said the threat of new tariffs “severely violates” the agreement the two countries struck in late June at the G20 meeting in Japan. Back then, President Trump agreed to allow US companies to resume selling products to Chinese telecommunications company Huawei Technologies and said that China would soon purchase large quantities of U.S. agriculture products.

US officials had said they would grant a handful of temporary exceptions to an export blacklist against Huawei, giving the firm some reprieve from tough trade penalties.

But a round of trade talks between the US and China last week made little progress and the US escalated trade tensions by saying it would implement additional tariffs starting September.

China hasn’t retaliated by imposing more tariffs on the US, but has allowed its yuan to depreciate against the US dollar.

In response, the US Treasury labelled China as a currency manipulator.

The Chinese Commerce Ministry said in its statement, which came hours earlier, that the US should implement the agreement between its presidents.

The Wall Street Journal