Sino-US cooperation should leverage agricultural trade as ‘fundamental pillar’

Summary

He Lifeng, Chinese lead for Sino-US economic and trade affairs and Vice Premier of the State Council, and US Treasury Secretary Scott Bessent held economic and trade consultations in South Korea on 13 May, exchanging views on resolving mutual concerns and expanding practical cooperation.Ministry of Commerce spokesperson He Yadong stated at a regular press conference on 25 June that trade cooperation in aircraft and agricultural products is mutually beneficial, and both teams will continue communication, encouraging enterprises to strengthen对接 and expand related trade.In 2025, total Sino-US agricultural trade amounted to US$26.8 billion, down 32.8% year-on-year, with the annual trade deficit narrowing to US$5.49 billion.

The spokesperson noted that China is willing to work with the US on the principles of equality, respect and mutual benefit to lengthen the cooperation list and compress the problem list. US-imposed tariffs are currently a major obstacle; the American Soybean Association has written to Trump urging an early agreement, as farmers are deeply affected by trade frictions. Both sides should explore a 'reciprocal exemption' approach to break tariff barriers.

Agricultural cooperation is one of the most important 'fundamental pillars' of Sino-US economic and trade relations, with strong industrial complementarity and broad prospects for future cooperation.

Commentary

Fluctuations in Sino-US agricultural trade have two implications for New Zealand small and medium-sized enterprise owners. In the short term, during the trade friction, Chinese importers may turn to alternative sources such as New Zealand, benefiting NZ agricultural exporters, for example in dairy, meat and fruit. In 2025, Sino-US trade fell by 32.8% and the deficit narrowed, indicating China is diversifying its import sources; NZ enterprises can seize the window to expand market share.

The long-term risk is that if the US and China gradually lower tariffs through mechanisms like 'reciprocal exemption', US agricultural products will regain a price advantage, squeezing NZ products' market share in China. For instance, once US bulk commodities such as soybeans and corn regain competitiveness, Chinese procurement may revert. NZ SMEs should monitor the progress of Sino-US consultations, especially details of tariff adjustment clauses, to avoid over-reliance on a single market.

It is advisable to strengthen product differentiation (e.g. organic, sustainable certifications) based on existing customer relationships, while developing emerging markets such as Southeast Asia to diversify risk.

Keywords: Sino-US cooperation, agricultural trade, tariff barriers, reciprocal exemption, Ministry of Commerce, He Lifeng, Scott Bessent, trade consultations, agricultural fundamental pillar, trade deficit

Source: Securities Times Online