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· Ag Secretary warns US markets to be patient if China cannot uphold trade agreements during virus outbreak
· China likely considering disaster clause in Phase 1 deal with U.S. -Global Times
· Coronavirus not expected to derail China's trade deal commitments: Mnuchin
Ag Secretary warns US markets to be patient if China cannot uphold trade agreements during virus outbreak
The US Agriculture Secretary has said that the US would have to be tolerant if the fast-spreading coronavirus impairs China's ability to increase purchases of American farm products under the countries' recently signed trade deal.
The Pig Site
6 February 2020
China, in the initial deal signed 15 January, promised to buy at least an additional $12.5 billion worth of US farm products in 2020 and at least $19.5 billion in 2021 over the 2017 level of $24 billion.
Commodity traders and agricultural economists have questioned whether Beijing will follow through on pledges in the deal to buy $36.5 billion of US agricultural goods in 2020, now that the new coronavirus is threatening China's economic growth.
"If they're really trying and it really just blows the economy out of the water, then we would have to be understanding of that," Perdue said, speaking to reporters at a cattle convention in Texas.
The United States wants China to live up to its pledges, Perdue said, but trade negotiators could not have anticipated the outbreak.
"There are force majeure type of things... that I think you have to be sensitive to," Perdue said.
The deal text contains a disaster clause, yet to be formally invoked by Beijing, to allow for delays: "In the event that a natural disaster or other unforeseeable event outside the control of the Parties delays a Party from timely complying with its obligations under this Agreement, the Parties shall consult with each other."
China's ability to meet its purchase target was in doubt even before coronavirus outbreak, because rival soybean supplier Brazil is harvesting a massive crop, and a deadly pig disease is reducing Chinese demand for soy used to feed livestock.
Hog and cattle futures on the Chicago Mercantile Exchange (CME) declined this week, with traders citing expectations that logistics problems caused by the outbreak would slow the pace of pork shipments to China at a time of plentiful US supplies.
"We have been relying on China the last few months, at least, to absorb an ever-increasing portion of the (pork) supply that we have. If that stops, even temporarily, it has a significant impact on the markets," said Altin Kalo, agricultural economist for New Hampshire-based Steiner Consulting...
China likely considering disaster clause in Phase 1 deal with U.S. -Global Times
by Se Young Lee, Reuters
Feb 6, 2020
BEIJING, Feb 6 (Reuters) - China is likely considering using a disaster-related clause in its Phase 1 trade deal with the United States due to the coronavirus outbreak that has killed more than 500 and infected tens of thousands, the Global Times reported on Thursday.
The Global Times, published by the official People’s Daily newspaper of China’s ruling Communist Party, cited an unnamed Chinese trade expert close to the government as saying a decision on launching a consultation with the United States on the disaster clause is unlikely until the end of the first quarter.
(Reporting by Se Young Lee; Editing by Tom Hogue)
Coronavirus not expected to derail China's trade deal commitments: Mnuchin
Treasury secretary says China cutting tariffs in half on some US goods is 'big step in the right direction'
By Evie Fordham, FOXBusiness
Feb 6, 2020
The U.S. expects China to be able to meet its commitments under the "phase one" trade deal, despite a coronavirus that has killed hundreds and closed stores and factories in East Asia, Treasury Secretary Steven Mnuchin said on "Mornings with Maria" Thursday.
"Based on our current projections of the virus, we're not worried about that," Mnuchin said. "But let me again say we're monitoring the virus carefully. We'll have a much better idea over the next two weeks. ... But based on current information, I don't expect there will be any issues in them fulfilling their commitments."
Hours earlier, China announced it would cut in half tariffs that the country levied in 2019 against 1,717 U.S. goods as part of the "phase one" agreement.
Mnuchin told FOX Business' Maria Bartiromo the move is a "big step in the right direction."
"This is part of China implementing 'phase one,' which is our big focus at this point," he said.
President Trump's chief economic adviser Larry Kudlow said exports in the "phase one" trade deal with China will be slowed down because of the coronavirus on "Mornings with Maria" on Tuesday.
"It is true the 'phase one' trade deal, the export boom from that trade deal, will take longer because of the Chinese virus," Kudlow said. "On the other hand...
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