Tea was not among the $200 billion in Chinese imports subject to a 10% US tariff announced Sept. 24.
In response, China canceled scheduled trade talks.
The escalation in the trade war between the two countries added to tariffs on $50 billion in goods imposed this summer. Chinese authorities responded with a $60 billion counterpunch in retaliation.
Tea Association of the USA president Peter Goggi says “tariffs on tea are highly unlikely.”
“The tea growing industry in the US is not yet large enough to warrant tariff protection,” Goggi explains. “While progress has been made and tea is being grown around the US, most of the production sites in the U.S. are small and artisanal in nature and are not in any position to replace the volume of Chinese tea in our markets.”
China exports 724,634,383 pounds of tea annually, of which 42,744,989 comes to the US. This means that in percentage terms, the US’ apparent consumption of Chinese tea is 5.9% of their exports and only 0.825% of production, said Goggi.
“The tea industry is vanishingly small by the standards of both countries’ economies and thus very little impact could be produced by including tea in the tariff scheme, and so we hope that tea may escape the notice of the competing interests due to its diminutive stature on the economic stage,” says Aaron Vick, senior tea buyer at the The G.S. Haly Co., in Redwood City, Calif.
The US maintains that China is expanding its economy unfairly by forcing US companies to hand over technology to gain access to the Chinese market. Unless China concedes, US President Donald Trump has threatened to impose tariffs on all Chinese imports, to offset a trade deficit which grew to $336 billion in 2017.“
Any tariff imposed on Chinese tea would not be protective, but rather, a transparently punitive attack on a culturally iconic product that embodies Chinese national pride,” said Vick.