Lost in the shuffle this past week was one piece of good news for Trump: a tentative trad deal with Japan that he and Japan's PM Shinzoe Abe signed in New York on the sidelines of the UN General Assembly meeting. While it is largely a favorable deal, it does not do too much and leaves the most difficult issue to be resolved by later negotiation, namely regarding the auto industry.
Trade restrictions are lowered on a variety of agricultural goods, including pork, beef, wheat, corn, and some fruits the US exports (but not soybeans), and on a few Japan exports including green tea, persimmons, and soy sauce.
In the industrial area, restrictions are lowered on machine tools from Japan and some scattered others. Restrictions are also lowered on digital products gong both ways. I do not know how much this will increase trade flows overall each way.
This is good news especially for many farmers, a main concern of Trump's although not soybean farmers, with, if anything, they possibly suffering from the lowering of barriers on soy sauce from Japan, which will hit Kikkoman in southern Wisconsin.
Of course autos are a very large item involving trade between the two countries, and there is no change on that one.
The final irony, of course, is that most of this, especially in the agricultural area, was part of the TPP that the US withdrew from. So basically this resembles the USMCA NAFTA replacement in largely simply putting in place the changes with other nations that would have happened anyway if the US had not withdrawn from the TPP, in short, undoing Trump's own handiwork from early in his administration, although that point is not being emphasized.
“Trade restrictions are lowered on a variety of agricultural goods, including pork, beef, wheat, corn, and some fruits the US exports (but not soybeans)”
I checked with Census and we exported $12.5 billion of agricultural goods to Japan in 2018 of which about $1 billion was soybeans.
Compare that to our ag exports to China which were $19.9 billion in 2016 but fell to $8.1 billion in 2018. Of course we exported $14.2 billion of soybeans in 2016 to China but that figure dropped to $3.1 billion in 2018.
If we exclude soybeans, our ag exports to Japan have exceeded our ag exports to China. But our exports of soybeans to China dwarfed all of this before Trump’s stupid trade war.
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