U.S. and China Plan Tariff Cuts on $60 Billion in Goods, but Start Date and Soybean Relief Remain Unresolved

A $60 billion agreement awaits legal approval

The United States and China have identified about $30 billion of goods from each country for lower tariffs, covering 1,619 categories of American products and 77 categories of Chinese products. The lists announced on September 28, 2026, range from U.S. corn, dairy products and medical devices to Chinese toys, coffee makers and Christmas decorations.

The central distinction is between an agreement on eligible products and tariff cuts that businesses can actually use. U.S. Trade Representative Jamieson Greer subsequently said there was no implementation timeline. The recommendations still need to pass through domestic legal procedures, and no effective date or complete schedule of new rates has been announced.

China's Ministry of Commerce said more than 90% of covered products would receive standard most favored nation tariff treatment, removing the additional reciprocal duties on those goods. That would substantially reduce the penalties attached specifically to bilateral trade, although ordinary import duties would remain.

The arrangement followed President Xi Jinping's state visit to Washington and meetings with President Donald Trump. It accompanies a separate extension of the existing trade truce from November 10, 2026, to January 10, 2027. Strategic products, including advanced chips, electric vehicles and batteries, remain outside the tariff package.

The Institute for Energy Research's coal agreement assessment, published October 9, says the two governments would implement the reductions simultaneously after completing their legal procedures. It also says the $30 billion lists on each side were based on 2024 import data. The headline figure therefore describes trade selected for possible relief, not a promise of $60 billion in additional purchases.

What products would receive lower tariffs?

China's list is heavily weighted toward agriculture and commodities. It includes corn, wheat, sorghum, meat, dairy products, seafood, vegetable oils and meals, alongside timber, cosmetics, personal care products and coal. Medical equipment includes MRI scanners, hearing aids, pacemakers, stents and surgical robots.

The U.S. list concentrates on everyday consumer products. Eligible categories include microwave ovens, toasters, coffee makers, electric irons, tableware, blankets, bed linens, artificial flowers, fireworks, children's car seats and sporting goods. Holiday products include glass and wooden ornaments and Christmas tree lamps.

The details limit some apparently broad categories. Toys are included, but toys enabled with Wi-Fi, Bluetooth, Ethernet or radio frequency connections are excluded. Bulk raw soybeans are also excluded, even though soybean meal and oil qualify and another account identifies soybean seeds for planting on China's list.

Greer described the intended scope in his statement announcing the recommendations:

nonsensitive goods on each side that could benefit from more favorable tariff treatment.

The distinction matters because the agreement leaves the most contested technology sectors untouched. Reports also identify electronics and semiconductors among the exclusions. Both countries may revise the lists later, although changes are expected no more frequently than annually.

Lower duties do not mean tariff free trade

Most favored nation treatment is the standard tariff treatment generally applied to trading partners under World Trade Organization rules. Despite its name, it does not mean a special concession reserved for one favored country. Rates vary by product and are often in single digits.

For covered goods, the proposed change would remove additional bilateral tariff penalties rather than necessarily eliminate every import charge. Product classification and the final legal notices will determine the rate that an importer must pay.

Leah Fahy, a senior China economist at Capital Economics, estimated that the average U.S. tariff on Chinese goods would fall from about 22% to 20.5%. That is a reduction of 1.5 percentage points, leaving the average 9.5 percentage points above the roughly 11% level before Trump's return to office.

Those figures explain how a large reduction for selected products can coexist with a relatively small change across all imports. The package is narrow compared with the full trading relationship, and many products will retain higher duties. The earlier escalation had taken some U.S. tariffs on Chinese goods as high as 145% in 2025.

Speaking at the G20 Trade Ministers' meeting in Milwaukee, Greer said the recommendations would require a legal determination before becoming a tariff action. He said the U.S. government could publish them for public consideration as part of that process.

"We have to stick to our legal processes," he said.

Equal dollar lists have unequal economic weight

The $30 billion selected in each direction represents a much larger share of American sales to China than of Chinese sales to the United States. Greer described the arrangement as improving market access for about 30% of U.S. exports to China.

Prashant Bhayani, chief investment officer for Asia at BNP Paribas Wealth Management, supplied another perspective: U.S. exports to China totaled roughly $68 billion during the first seven months of 2026, while Chinese exports to the United States were about $270 billion during the first eight months.

Measured against those amounts, $30 billion equals about 44% of the American export figure and 11% of the Chinese export figure. These are scale comparisons, not annual coverage rates. The reporting periods differ, and the proposed lists use a separate historical trade basis.

Lynn Song, chief economist for Greater China at ING Bank, said the treatment proposed for eligible products could produce a stronger recovery than a smaller tariff reduction:

This is a positive outcome for these affected products compared to a smaller tariff cut and could lead to a more significant boost to bilateral trade.

The recovery would take place against a persistent imbalance. China's global goods trade surplus was about $800 billion by August, according to Ecaterina Bigos, senior market strategist at BNP Paribas Asset Management, who said it was on course to exceed the $1.2 trillion record for 2025.

That follows the surplus passing $1 trillion during 2025, when stronger exports to markets outside the United States helped offset weaker American demand. Relief for selected bilateral goods does not by itself reverse that wider pattern.

Soybean purchases and soybean tariff relief are separate

Raw soybeans are the clearest fault line in the agricultural agreement. Corn, wheat and sorghum qualify for relief, but bulk soybeans remain subject to an additional 10% Chinese tariff. One account describes soybeans and related products as part of the agricultural focus; the more detailed product accounts distinguish eligible meal, oil and planting seeds from excluded bulk beans.

China's existing purchase commitments are separate from this tariff list. Scott Metzger, president of the American Soybean Association and an Ohio soybean farmer, said China had committed to buying at least 25 million metric tons annually in 2026, 2027 and 2028.

"China remains an important market for U.S. soybeans, and we want to see a strong trading relationship that allows more customers in China to purchase our soybeans," Metzger said.

The association, representing more than 500,000 growers across 30 states, nevertheless expressed disappointment at the exclusion. Its statement said the remaining 10% retaliatory duty limits access for private Chinese importers.

John Bartman, an Illinois farmer whose family has grown soybeans for five generations, described the exclusion in direct terms:

This was a missed opportunity for the American farmer.

Wendy Cutler, senior vice president at the Asia Society and a former U.S. trade negotiator, said the exclusion appeared deliberate given the purchasing commitments already negotiated. Agriculture Secretary Brooke Rollins offered a more positive assessment, saying China had bought the promised 12 million metric tons for the 2025 season and that purchases toward the 2026 target were on track.

Why farmers remain concerned despite purchase pledges

Sunghun Lim, an associate professor of economics at Iowa State University, said the remaining tariff makes American soybeans less competitive and can reduce sales opportunities while putting pressure on farm prices. His distinction between a negotiated target and a stable commercial relationship is central to the dispute:

A purchase commitment and a dependable market are not the same thing.

China imported 22.1 million metric tons of American soybeans worth $12.04 billion in 2024. In 2025, U.S. shipments fell 24.1% to 16.8 million metric tons, even as China's total soybean imports grew 6.5%. Brazil supplied about 74% of China's soybean imports that year, or 82.3 million metric tons.

A 25 million metric ton commitment would exceed the reported 2025 American shipment volume by 8.2 million metric tons. It would still be below the 29 million metric ton annual average for 2020 through 2024. Purdue University's Centre for Commercial Agriculture put that shortfall at about 14%.

Reports differ on purchase progress because they cite different measures and periods. Rollins described the calendar year target as on track, while reports of Chinese state company purchases put buying above 12 million metric tons. Breakwave Advisors recorded visible sales of 9.97 million metric tons as of September 24 against a fiscal 2026/27 target. These figures cannot be treated as interchangeable measures of delivered imports.

The broader agricultural pledge is at least $17 billion annually for three years, below the $40 billion in U.S. agricultural exports to China recorded in 2022. Production costs also remain a pressure: AAA data put diesel at $6.53 per gallon on September 22, easing to $6.45 the following Monday.

The historical exposure is substantial. USDA analyses attributed about 71% of U.S. agricultural export losses during the 2018 trade dispute to soybeans, approximately $9.4 billion annually. Lim cautioned that this was an export loss estimate, not a measure of lost farmer income or an exact forecast for today's dispute.

Coal commitments could redirect shipping demand

China has committed to importing at least 10 million metric tons of U.S. coal annually in 2027 and 2028. That is about 2% of China's annual coal imports. The Institute for Energy Research says China imported more than 12 million tons of American coal in 2024, so the promised minimum would not establish a new historical peak.

Breakwave Advisors' commodity trade assessment expects benefits to concentrate in metallurgical coal, used in steelmaking, rather than thermal coal, used mainly for power generation. Higher value metallurgical cargoes can better absorb the cost of the long voyage from American ports.

The assessment cites AXSMarine data showing China imported about 30.2 million metric tons of coking coal during January through August. Russia supplied 42% and Australia 38%, together accounting for 80%. Greater American sales would therefore compete principally with established suppliers in that market, rather than necessarily replace Indonesian thermal coal.

The shipping effect depends on distance as well as cargo volume. More American coal and grain traveling to China would generate additional tonne miles, a measure combining how much cargo moves with how far it travels. Longer voyages occupy vessels for more days and can support freight rates if ship availability is tight.

Lower tariffs will not automatically create stronger commodity demand. Breakwave puts China's corn imports at 2.44 million metric tons during January through August 2026, compared with about 23 million over the full year in 2023. Its seaborne wheat imports were about 3.2 million metric tons during the same eight months, with Canada and Australia the main suppliers. The differing periods prevent a direct annual decline calculation, but the figures show the smaller import market American exporters face.

The assessment also records U.S. beef sales of about 7,300 metric tons as of September 17, compared with roughly 35,000 a year earlier. A separate Chinese commitment to an initial 200 Boeing aircraft had not become a firm order by mid September. Oil and liquefied natural gas were excluded from the new tariff lists.

Consumers and European producers face different effects

Jacob Cooke, chief executive of Beijing based WPIC Marketing + Technologies, identified hair care, personal care and infant formula as categories where American consumer brands could benefit. Gary Ng, senior economist at Natixis, said cheaper Chinese consumer goods could help reduce U.S. inflation while giving Chinese producers more room to sell excess output.

Those potential benefits arrive during weak consumer sentiment. The Conference Board's consumer confidence index fell 6.7 points to 81.9 in September, its lowest reading since 2014. A tariff reduction can lower import costs, but the agreement does not establish how much retailers would pass through to shoppers.

European exporters could face tougher competition in both markets. The EU shipped about 1.07 million tonnes of pork to China in 2025, according to S&P Global data. Reported Chinese duties on EU pork range from 4.9% to 19.8%, while duties on some European cheese and cream range from 7.4% to 11.7%. Lower duties for American rivals could widen those price differences.

European makers of household goods, toys and sports equipment could also face stronger Chinese competition in the United States. The size of either effect depends on final rates, implementation dates and how buyers respond.

For seasonal exporters, timing may matter as much as the eventual reduction. Richard Chan of Golden Arts Gifts & Decor, which manufactures Christmas decorations in southern China, welcomed the announcement:

This is positive news," Chan said. "The economy in both the U.S. and China is not really good, and the two sides should help each other more.

Most goods for the current Christmas season were already being shipped, limiting the immediate benefit. Without an effective date, exporters cannot yet know which shipments will qualify.

The truce has deadlines, but implementation does not

The tariff recommendations sit inside a larger diplomatic timetable. The countries plan an agricultural working group meeting before the end of the year to discuss market access and regulation. They also agreed to create a communication channel for artificial intelligence incidents and hold a further AI dialogue by the end of November.

The principal dates are:

• May 2026: The Board of Trade framework was established during Trump's visit to Beijing.
• September 28, 2026: The reciprocal product lists were announced following the Washington summit.
• By the end of November 2026: A further AI dialogue is planned.
• Before the end of 2026: The agricultural working group is expected to hold its first meeting.
• January 10, 2027: The extended trade truce expires.
• 2027 and 2028: China's annual U.S. coal purchase commitments apply.

Reports describe the Board of Trade both as established in May and as launched during the September summit. Those descriptions may refer to the original framework and its operational mechanism, but the accounts do not fully resolve the distinction.

Further Trump and Xi meetings are expected at the Asia-Pacific Economic Cooperation summit in Shenzhen in November and the G20 summit in Florida in December. China will also review foreign financial institutions' applications to operate and open branches, while discussions on increasing direct flights continue.

The disputes beyond the eligible goods remain active. Washington is investigating China among 16 trading partners in a Section 301 inquiry into excess industrial capacity that could produce additional tariffs. G20 trade ministers also failed to reach consensus on statements addressing excess capacity and forced labour.

The result is a targeted easing, not a comprehensive settlement. The next practical milestone for businesses is publication of legally effective tariff measures specifying rates, eligible classifications and a start date. None has yet been announced.

Key Points

• The proposed tariff package covers about $30 billion of goods from each country, not $60 billion in guaranteed new purchases.
• China's list includes 1,619 product categories; the U.S. list includes 77.
• More than 90% of covered products are expected to receive standard tariff treatment, subject to legal approval.
• No implementation date or complete new rate schedule has been announced.
• Bulk raw soybeans remain subject to an additional 10% Chinese tariff despite separate purchase commitments.
• China pledged to import at least 10 million metric tons of U.S. coal annually in 2027 and 2028.
• The broader trade truce runs through January 10, 2027, while strategic technology disputes continue.