The U.S. & China Agree to Trade Cease-Fire to Continue Negotiations

Tariff GraphicOver the weekend, the United States and the Peoples Republic of China agreed to a temporary cease-fire in the trade war that has been ongoing between the two countries. President Donald Trump and President Xi Jinping have entered into a 90-day window ending March 1, 2019, to negotiate a long-term solution to the trade dispute.

As part of the negotiations, the United States has agreed to put on hold a planned tariff increase on $200 billion of Chinese goods from 10% to 25%, which was supposed to go into effect on January 1, 2019. China has stated that they are willing to expand imports, including the purchase of marketable goods from the United States, and gradually ease the trade imbalance. Furthermore, the Trump Administration has said that China’s agreement to increase its purchase of U.S. goods includes agricultural and energy, though types and amounts were not specified.

What does this mean for pistachios?

With the temporary cease-fire, the expectation is that there will not be any tariff increases on pistachios, at least through the 90-day negotiation time-table. The agreement will maintain the China raw pistachio tariff at 45 percent ad valorem and the roasted pistachio tariff at 15 percent ad valorem. It is still unclear whether pistachios will be included as part of China’s increased purchasing of U.S. agricultural goods. American Pistachio Growers continues to advocate for a permanent resolution to the trade dispute that includes a zero tariff for pistachios.