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China imposed duties of up to 15% on major U.S. farm products and announced targeted actions at more than 20 companies on Tuesday, retaliating against President Donald Trump’s increased tariffs.
The tariffs target major food exports to China, including chicken, wheat, corn, and cotton, with a 15% rate. A 10% duty was added to imports of “sorghum, soybeans, pork, beef, aquatic products, fruits, vegetables, and dairy products.”
According to the U.S. Department of Agriculture (USDA), China was the biggest market for U.S. agricultural exports in 2023, accounting for 17% of trade. Products subject to the new tariffs make up the majority of agricultural goods imported by China.
A recent USDA study projected China to be the third-largest agricultural market this year, with exports falling by $1.3 billion from a prior projection due to increased competition for soybeans, corn, sorghum, and cotton. Overall trade in fiscal year 2025 is set to reach $22 billion.
China’s Ministry of Commerce also placed 15 U.S. companies on its export control list, including drone makers Skydio and AeroVironment (AVAV-3.72%), Leidos (LDOS+2.28%), Aerkomm, and Shield AI, an artificial intelligence startup backed by Andreessen Horowitz. It also added 10 companies to its “unreliable entity” list, including Wisconsin-based S3 AeroDefense, setting the ground for sanctions.
Illumina (ILMN+0.04%), the biotech firm that recently began layoffs, was placed on the unreliable entity list last month in China’s first wave of retaliation against the tariffs, alongside Calvin Klein (PVH-1.99%) owner PVH Corp. Now, Beijing says Illumina can’t export gene sequencers to China, which accounts for 7% of its sales.
China also issued anti-dumping duties on U.S. companies that export single-mode optical fiber to the market. Tariffs on those firms range from between 33.3% to 78.2%, according to the Ministry of Commerce.
“If the U.S. has other agenda in mind and if war is what the U.S. wants, be it a tariff war, a trade war or any other type of war, we’re ready to fight till the end,” China Foreign Ministry spokesperson Lin Jian said Tuesday.
On Monday, Trump increased tariffs on imported Chinese goods to 20% from 10% and maintained other restrictions that went into effect in February. He cited a failure on China’s part to reduce the flow of fentanyl into the U.S.
The U.S. also issued tariffs of 25% on all Mexican goods and most Canadian goods, which went into effect early on Tuesday. The duties on Canadian goods include a carveout for energy products, which will be taxed at 10%, in an effort to keep gas prices more manageable.
Wendon Zhang, a professor of applied economics and policy at Cornell University, estimates that Trump’s tariffs could shed 0.4% of real gross domestic product (GDP) loss from the U.S. economy. That comes out to a loss of more than $100 billion.
Canadian Prime Minister Justin Trudeau hit back with a 25% tariff on C$155 billion worth of American goods, although just C$30 billion worth are immediately impacted. Several premiers have discussed their own measures, with Ontario’s Doug Ford targeting U.S. alcohol and Elon Musk’s Starlink.
“Because of the tariffs imposed by the U.S., Americans will pay more for groceries, gas, and cars, and potentially lose thousands of jobs,” Trudeau said in a statement. “Tariffs will disrupt an incredibly successful trading relationship.”
President Claudia Sheinbaum of Mexico on Monday said the nation has “a plan B, C, D” of how to respond to the U.S., without elaborating. She had earlier directed Mexico’s economy secretary to prepare a series of tariff and non-tariff retaliatory measures.