Biggest Trade War in History

This week, President Trump threatened China with stiffer tariffs ahead of trade talks. On Friday, he raised tariffs from 10 to 25 percent on a $200 billion worth of Chinese goods. For U.S. consumers, this will mean higher prices on goods imported from China, on items from toothbrushes and toilet paper to grills and refrigerators.

The new tariffs prompted retaliatory threats from the Chinese, which caused markets to tumble. U.S. stocks dropped to a five-week low on fears that economic shocks from reduced trade will continue to hurt companies.

Soybeans, which would likely be subject to Chinese counter tariffs, fell hard, trading near $8 per bushel for the first time since 2008. One third of all U.S. soybeans are typically exported to China, but sales have plummeted during the ongoing trade war.

Other agricultural markets including corn, cotton, and hogs tumbled as well, leaving U.S. farmers at risk of having devastating losses this year. If a trade deal can’t be cut, many are hoping for another bailout this year, mirroring last year’s $12 billion payout to U.S. farmers hurt by the trade war. However, Agriculture Secretary Sonny Perdue recently said there was no plan for another payment to farmers, leaving them caught in the middle of the Transpacific trade war.