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Trade war

China says it has stopped buying US farm goods

Beijing will 'not rule out' tariffs for deals made after Aug. 3

Imported soybeans are transported at a port in Nantong, of China's Jiangsu province.

NEW YORK/BEIJING -- Chinese companies have halted purchases of agricultural products from the U.S., the government announced early Tuesday, days after President Donald Trump announced new tariffs on hundreds of billions of dollars in Chinese imports.

"China would temporarily not rule out the possibility of levying additional tariffs on imported U.S. farm produce with deals made after Aug. 3, and related Chinese companies have halted purchases of U.S. farm produce," the Ministry of Commerce said in a statement.

"With a huge market, China is a promising destination for high-quality U.S. agricultural products," it said. "We hope that the U.S. should earnestly implement the consensus reached in Osaka and be committed to fulfilling its promises to create necessary conditions for bilateral agricultural cooperation."

The midnight announcement hinted at the back-and-forth within the Chinese government over how to handle the agricultural purchases.

Earlier Monday, an official of China's top economic planning body had insisted that Chinese companies have purchased millions of tons of soybeans, sorghum, wheat and other farm goods since the end of June, Trump's tweets to the contrary notwithstanding.

Speaking to state media, Cong Liang, secretary-general at the National Development and Reform Commission, was responding to Trump's complaint that China has reneged on its pledge to buy from U.S. farmers.

Some 2.27 million tons of American soybeans were shipped to China from the end of June to the end of July, according to Cong. Another 2 million tons are to be loaded this month, he said.

China also concluded deals to buy 130,000 tons of soybeans between July 19 and Friday, along with 120,000 tons of sorghum and 75,000 tons of hay, according to Cong. Other targets include wheat, pork and cotton, he said.

But U.S. Department of Agriculture data shows exports of slightly over 1.55 million tons of American soybeans to China from June 28 to Aug. 2 -- far less than Trump expected.

On Friday, China vowed to retaliate after Trump tweeted that the U.S. will impose a 10% tariff on $300 billion in Chinese goods from Sept. 1. The American leader blamed Beijing's failure to keep promises, including one to "buy agricultural product from the U.S. in large quantities."

The U.S. agriculture sector has been among the hardest hit since the trade war started. American farmers have been pressing Trump to cut a deal with China, the world's largest soybean consumer. Soybean prices are determined by demand, and the farmers prefer trade over aid.

The next cabinet-level meeting between the two sides is slated for September in Washington. The push and pull over American farm goods will likely intensify.

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