China Abruptly Ends Anti-Dumping Probe Against US Sorghum

Chinese Vice Premier Liu He met with U.S. President Donald Trump to discuss trade issues on May 17

Chinese Vice Premier Liu He met with U.S. President Donald Trump to discuss trade issues on May 17

A delegation headed by China's Vice-Premier Liu He is now in the U.S. for trade talks and dropping the sorghum probe might be an olive branch for the negotiations.

The huge change, which experts say would be very hard to achieve, is still just a proposal and no agreements have been reached yet in the trade talks between the two sides, the officials added.

After the trade talks Thursday in Washington between top USA officials and a Chinese delegation, the White House said that "the two sides agreed to continue the discussions on Friday".

China said a final ruling on whether to continue April's 178.6% tariffs would be made after a further investigation. But it is still not a big deal compared with the overall trade deficit in goods, which reached $375 billion a year ago.

A field of sorghum (milo) grain is seen at a farm outside of Texhoma, Oklahoma, U.S., in this undated photo released to Reuters on April 3, 2018.

China imported $956 million of sorghum from the United States a year ago, according to the Commerce Ministry.

American companies would need time to adjust to a huge jump in demand from China.

Larry Hu, an economist at investment bank Macquarie, said the Chinese proposal was likely to be dependent on the United States removing restrictions on the export to China of certain advanced American technologies.

According to The New York Times, under the deal being discussed, China would pledge to buy substantially more American goods, including agricultural products like soybeans, as well as semi-conductors and natural gas. He said on Twitter on Sunday he had ordered the U.S. Commerce Department to put ZTE back in business.

Some China trade watchers expressed scepticism that a $200 billion reduction in the trade gap could be achieved quickly and said the offer may include repackaged commitments previously announced by China.

Agreeing to a deal focused primarily on reducing the trade deficit could also weaken Trump's original tariff goal of pressuring China to end policies that his administration says are aimed at misappropriating USA technology - a bigger structural change for China's state-driven economic model.

The Chinese Commerce Ministry on Friday announced the end of an anti-dumping inquiry into USA sorghum imports.

"The anti-dumping and anti-subsidy investigation into imports of sorghum originating from the U.S. has been closed", it said in a statement. "They want it to be a numbers issue", Wolf said.

China and the U.S. have imposed - or threatened to impose - tariffs on various goods, in what observers warn could escalate into a larger trade war.

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