China says firms have started inquiring about U.S. agriculture purchases

BEIJING (Reuters) – China said on Thursday that Chinese companies have started to inquire about prices for U.S. agricultural goods purchases, in a further sign of a potential de-escalation in a bitter trade war between the two countries.

The move comes before a planned meeting in early October between top U.S. and Chinese trade negotiators in Washington aimed at easing the protracted trade conflict that has disrupted global supply chains and rattled financial markets.

On Wednesday, the United States agreed to delay increasing tariffs on $250 billion worth of Chinese imports from Oct. 1 to Oct. 15 “as a gesture of goodwill.” The tariffs were set to increase to 30% from 25% on the goods.

Speaking at a weekly news briefing in Beijing, Chinese Commerce Ministry spokesman Gao Feng said China welcomed the U.S. move.

“According to my understanding, Chinese firms have started to inquire about prices for U.S. agricultural goods. (China) hopes both sides would continue to meet each other half way and adopt concrete actions to create favorable conditions for negotiations,” Gao said.

Possible purchases of U.S. farm goods included pork and soybeans, Gao said, both of which are still subject to hefty Chinese duties.

Despite tariffs of 62% in place since last year, U.S. exports of pork to China jumped 51% in the first seven months of 2019 over last year to 240,000 tonnes, according to the U.S. Meat Export Federation.

In July alone, the U.S. exported about 3,000 containers, or almost 61,000 tonnes of pork, as buyers stepped up purchases amid a huge shortfall in China that has driven prices to record levels.

China reduced purchases of U.S. farm products in August, after Trump vowed to impose new tariffs on around $300 billion of Chinese goods, blaming Beijing for not having fulfiled a promise to buy large volumes of U.S. farm products and abruptly dimming prospects of a trade deal.

Gao said working-level teams from both countries will meet soon to prepare for the next round of top-level talks between Chinese Vice Premier Liu He, and U.S. Trade Representative Robert Lighthizer and Treasury Secretary Steven Mnuchin.