2025-04-02 23:40

SYDNEY, April 3 (Reuters) - Almost unnoticed in the sweeping new import tariffs announced by U.S. President Donald Trump is that energy commodities have been excluded. The baseline of 10% on all imports to the United States, and higher for many major trading partners, won't apply to crude oil, natural gas and refined products, the White House said on Wednesday. Sign up here. Exempting energy imports is a clear tactic to limit the extent of the price pain that Americans are going to feel from the tariffs, and fits with Trump's broader aim to keep energy prices low. But the move also adds to the dilemma facing the rest of the world in how they respond to Trump's upending of the global trading system. One of the best bargaining chips many countries will have in responding to the U.S. tariffs is the energy they buy, or could potentially buy, from the United States. The United States is the world's top exporter of liquefied natural gas (LNG) and of refined oil products, and ranks fourth in shipments of crude oil and coal. One of the ways some countries have been trying to stave off tariffs is to commit to buying more energy from the United States. It's now questionable that any of these efforts have worked, given the blanket 10% tariffs and the higher rates of 20% on the European Union, 34% on China, 24% on Japan and 26% on India. These are all countries or regions that currently are major buyers of U.S. energy, or have been, or have the potential to ramp up imports. Will these countries now put U.S. energy imports on the table in their response to Trump's tariffs? It may be worthwhile to view Trump's tariff actions as similar to those of a schoolyard bully. To deal with a bully, you have effectively three choices. You can stand up and fight, in which case you may take several body blows, get hurt and even be defeated. But you will earn respect and may benefit down the line. Or you can duck and weave, try to negotiate and plead and hope not to get hurt. This usually results in you losing both your lunch money and your respect. The third choice is to run and hide and hope the bully leaves you alone. This may work for a while but only delays the inevitable. FACING CHOICES As far as buying energy from the United States, China has so far chosen to stand and fight, imposing tariffs on imports of U.S. crude, LNG and coal. This has effectively ended the trade in these products between the world's two biggest economies. But it also hasn't really made much difference to the prices on global markets, largely because China was a relatively small buyer of U.S. energy, and is able to source alternatives without disrupting global flows. It's not the same for Europe, which gets more than half of its LNG from the United States, and couldn't easily replace that from other suppliers. Europe is also a major buyer of U.S. crude and refined products, and, similar to LNG, would find it hard to source alternatives without causing widespread disruption to global flows and prices. Europe could conceivably drop U.S. coal without too much negative impact, but the continent is a small buyer. Japan and India are more likely to try and use energy purchases from the United States as bargaining chips in talks with the Trump administration to secure exemptions or carve outs from the tariffs. Given the inconsistent nature of Trump and his administration, this may be a tactic that bears fruit, but for now the best that can be said about trying this path is that it is highly uncertain. While different countries or regional groups like the European Union work through their responses, the common thread that is likely to emerge is that they will seek to lower their reliance on the United States and build trade relations with other nations. The ultimate result of the tariffs is that the United States will likely become the trading partner of last resort, with countries only buying what they cannot get elsewhere. The views expressed here are those of the author, a columnist for Reuters. https://www.reuters.com/business/energy/trumps-tariffs-already-have-major-carve-out-oil-gas-russell-2025-04-02/

2025-04-02 23:02

MEXICO CITY/OTTAWA, April 2 (Reuters) - Mexico and Canada avoided fresh tariffs on Wednesday with President Donald Trump exempting the United States' top trading partners from his new 10% global tariff baseline, although previous duties remain in place. Goods from Mexico and Canada that comply with the USMCA trade agreement between the three countries will largely remain exempt from tariffs, except for auto exports and steel and aluminum which fall under separate tariff policies. Sign up here. Trump previously imposed 25% tariffs on Mexico and Canada for not doing enough to curb migration and fentanyl trafficking, but later issued a carve out for USMCA compliant goods. "For Canada and Mexico, the existing fentanyl/migration ... orders remain in effect, and are unaffected by this order," the White House fact sheet said. "In the event the existing fentanyl/migration ... orders are terminated, USMCA compliant goods would continue to receive preferential treatment, while non-USMCA compliant goods would be subject to a 12% reciprocal tariff." Some analysts said Canada and Mexico appeared to have avoided the worst-case scenario. “Mexico and Canada are almost certainly sighing relief after today’s announced tariffs," said Michael Camunez, chief executive of Monarch Global Strategies, which advises firms doing business in Mexico. "The North American partners were shielded from what clearly could have been a very bad day.” Candace Laing, president and CEO of the Canadian Chamber of Commerce, said in a statement: "We hope that today's positioning regarding Canada by the U.S. is part of a path to real negotiation, ultimately leading to long-term partnership." Speaking after Trump's announcement, Canada's Prime Minister Mark Carney said he still planned to respond with countermeasures. "We are going to fight these tariffs with countermeasures, we are going to protect our workers, and we are going to build the strongest economy in the G7 (group of nations)," he said. https://www.reuters.com/world/americas/canada-mexico-not-subject-new-global-rates-while-fentanyl-border-order-place-2025-04-02/

2025-04-02 22:55

April 2 (Reuters) - The U.S. tariff rate on all imports has rocketed to 22% from just 2.5% in 2024 under the new global levies imposed by President Donald Trump, Fitch Ratings' U.S. economic research chief said on Wednesday. "That rate was last seen around 1910," Olu Sonola, Fitch's head of U.S. economic research, said in a statement after Trump's announcement for a global baseline import tax of 10%, but much higher rates for many trading partners. Sign up here. "This is a game changer, not only for the US economy but for the global economy," Sonola said. "Many countries will likely end up in a recession. You can throw most forecasts out the door, if this tariff rate stays on for an extended period of time." https://www.reuters.com/markets/us/us-tariff-rate-rockets-22-highest-since-1910-fitch-economist-says-2025-04-02/

2025-04-02 22:52

Trump to impose 10% baseline tariff on Australian exports Trump singles out Australian beef in White House comments Albanese says Australia will not join a race to the bottom SYDNEY, April 3 (Reuters) - Australian Prime Minister Anthony Albanese said on Thursday the decision by U.S. President Donald Trump to impose a 10% tariff on its ally was "not the act of a friend," but ruled out reciprocal tariffs against the United States. In comments outside the White House, Trump singled out Australian beef, which saw a surge in exports to the United States last year, reaching A$4 billion amid a slump in U.S. beef production. Sign up here. "They won't take any of our beef. They don't want it because they don't want it to affect their farmers and you know, I don't blame them but we're doing the same thing right now," Trump said in an event in the White House Rose Garden announcing tariffs on a wide range of U.S. trading partners. Australia banned U.S. fresh beef products in 2003 due to the detection of bovine spongiform encephalopathy, otherwise known as mad cow disease, in U.S. cattle. BSE poses a risk to human health and has never been detected in cattle in Australia. Albanese said Trump had not banned Australia beef, but had imposed a 10% duty on all Australian goods entering the United States, equivalent to the U.S. baseline tariff on all imports, despite U.S. goods entering Australia tariff free. "The (Trump) administration's tariffs have no basis in logic and they go against the basis of our two nations' partnership. This is not the act of a friend," Albanese told reporters. Australia would not impose reciprocal tariffs as this would increase prices for Australian households, he added. "We will not join a race to the bottom that leads to higher prices and slower growth," Albanese said. Australian shares (.AXJO) , opens new tab dropped 0.9% and the local dollar , a proxy for global risk sentiment, fell 0.5% to $0.6269. Australian officials said countries in the Indo-Pacific region were among the hardest hit by the U.S. tariffs, with Albanese suggesting this could advantage China. "There's no doubt that the response on a range of issues, be it action on climate change as well as trade issues will affect the strategic competition that's here in the region," he said. Australia would seek to negotiate with the U.S. to remove the tariffs without resorting to a dispute resolution mechanism in the two countries' Free Trade Agreement, he said. Amid the campaign for parliamentary elections set for May 3, opposition Liberal Party leader Peter Dutton criticised Albanese for not winning a tariff exemption, and said Australia should leverage its critical minerals deposits and defence alliance to quickly strike a deal with Trump. "This is a bad day for our country," Dutton said. Australia had used all elements of its diplomacy, Albanese said, including seeking advice last night over dinner from sport star Greg Norman, who plays golf with Trump. BEEF OVER BIOSECURITY Negotiations to avoid a tariff stalled over beef as Australia insisted on U.S. meat imports meeting its biosecurity standards, Albanese said. Biosecurity is one of three areas, alongside subsidised pharmaceuticals that lower health costs to Australians, and rules on U.S. social media platforms, raised by the U.S. as trade barriers that Australia would not compromise on, he told reporters. Australia will offer financial support to affected exporters to help them find new markets, with a fund offering A$1 billion ($627 million) in zero interest loans, and direct government departments to 'buy Australian'. National Farmers Federation President David Jochinke said the tariffs were a "disappointing step backward for our nations and for the global economy", but the industry would prevail because its farmers are "among the least subsidised farmers in the world". Exports to the United States are less than 5% of Australia's total goods exports, compared to one in four export dollars coming from trade with China. Australian steel and aluminium exports are also subject to U.S. tariffs on the metals announced in March, though its shipments to the U.S. are a fraction of the value of country's total annual exports. Less clear is the impact from those levies on Australia's mining sector, which supplies much of the world's iron ore and other metal-making raw materials. Trade Minister Don Farrell said Australia was opening new exports markets in India and the Middle East, and would seek to revive free trade negotiations with the European Union that had stalled last year over access for Australian beef. "The world has changed," he said. New Zealand's Trade Minister Todd McClay said a 10% tariff on the country, a large exporter of lean beef used in U.S. hamburgers, meant its exports remain competitive in the U.S. market, compared to nations hit by higher tariffs. ($1 = 1.5949 Australian dollars) https://www.reuters.com/world/australia-says-us-tariffs-not-act-friend-rules-out-reciprocal-move-2025-04-02/

2025-04-02 22:48

NAPERVILLE, Illinois, April 2 (Reuters) - The United States was once the world’s breadbasket, commanding global grain and oilseed trade by a wide margin. The country still leads in corn exports. That title, however, has recently been threatened by Brazil, the same party that demoted U.S. soybean exporters to the No. 2 spot. Sign up here. But the United States’ grip on global corn, soybean and wheat exports is as loose as it’s ever been. U.S. President Donald Trump on Wednesday announced sweeping reciprocal tariffs on all trade partners, a risk U.S. farmers accepted when largely backing him in last year’s election. Trade barriers, whether real or perceived, could certainly chip away at U.S. export relevance in a space it once overwhelmingly controlled. Rival grain suppliers have padded both their crops and export capabilities over the decades, sometimes capitalizing on U.S. misfortunes along the way. EXPORT SHARE SQUEEZE On average over the last five years, the United States accounted for a record-low 31% of annual global corn exports. Twenty years ago, the U.S. portion was 61%, though it had topped out at 80% in the late 1970s. The biggest drop-off was seen between the late 2000s and early 2010s, when the share went from 59% to 35%. This period included the global financial crisis and a prominent string of U.S. crop failures. No. 2 corn supplier Brazil accounted for only 5% of exports some 20 years ago, though its share is now up to 22%. The U.S. portion of world soybean exports has plunged significantly, recently averaging a record-low 27%. That was above 80% through the 1970s, falling to 50% by the turn of the century. Brazil became the leading soy supplier in 2012-13, and its share has climbed. Brazil now accounts for 55% of global soybean exports versus 39% a decade ago, a period including the first U.S. trade war with China, when Beijing reduced reliance on U.S. beans. The United States was the top wheat exporter until about 10 years ago, and today it is the No. 4 supplier. But U.S. wheat export dominance was at its peak in January 1980 when then-President Jimmy Carter on live television cancelled 17 million metric tons of U.S. grain export contracts with the Soviet Union due to the Soviet invasion of Afghanistan. This became known as the U.S. grain embargo. At that time, the United States accounted for 44% of global wheat exports. That share now sits at a record-low 11%, down from 26% some twenty years ago. Carter’s speech echoed sentiments recently shared by Trump, including the desire to minimize harm to the American farmer and massively increase the volume of agricultural products used domestically. U.S. intelligence concluded in 1981 that the U.S. embargo was substantially less harmful to Moscow’s grain stocks than intended because the Soviets were able to source more grain from other suppliers than the Americans had anticipated. That should sound familiar to the soybean market, as Brazil in recent years has shipped more soybeans than traders and analysts previously thought possible. In the early 1980s, the Soviet Union was the top wheat importer, accounting for more than 20% of annual imports. Today, Russia is the top wheat exporter, supplying more than 20% of annual shipments. PRODUCTION TRENDS The United States is the leading producer of corn, No. 2 in soybeans and No. 4 in wheat. Similar to exports, the recent U.S. production shares are also all-time lows. The United States accounts for 31% of global corn production, down from about 41% some 20 years ago. The country accounted for more than half of global soybean production until about 1990, though the share now sits at 28%. U.S. wheat accounted for about 15% of global production in 1980, though today it accounts for 6%. Unlike corn and soybeans, the U.S. wheat crop is now generally smaller than it was decades ago. But Russia has expanded its wheat crop by more than 70% over the last decade, accounting for 11% of world output. That compares with 7% a decade ago. Brazil has increased its soybean production by about 85% over the last decade and corn by around 55%, taking advantage of market opportunities and upbeat profitability. Brazil grows 39% and 10% of global soy and corn output, respectively, up from 30% and 8% a decade ago. Not all global crops can infinitely expand from here, but the lesson should be clear. Significantly more grain is produced outside the United States versus decades ago, and those suppliers may be ready to act if Washington’s latest move backfires. Karen Braun is a market analyst for Reuters. Views expressed above are her own. https://www.reuters.com/markets/commodities/by-numbers-erosion-us-grain-export-dominance-braun-2025-04-02/

2025-04-02 22:19

April 2 (Reuters) - President Donald Trump on Wednesday unveiled sweeping global tariffs of at least 10% on goods imported from most U.S. trading partners. For details of the announcement see: https://www.whitehouse.gov/fact-sheets/2025/04/fact-sheet-president-donald-j-trump-declares-national-emergency-to-increase-our-competitive-edge-protect-our-sovereignty-and-strengthen-our-national-and-economic-security/ , opens new tab Sign up here. For details of his order ending de minimis exemptions for China see: https://www.whitehouse.gov/fact-sheets/2025/04/fact-sheet-president-donald-j-trump-closes-de-minimis-exemptions-to-combat-chinas-role-in-americas-synthetic-opioid-crisis/ , opens new tab (This story has been refiled with the correct URL for the order fact sheets) https://www.reuters.com/world/us/white-house-fact-sheet-accompanying-trumps-new-tariff-orders-2025-04-02/