US and China cut tariffs on $60B in goods, excluding sensitive tech and soybeans

The United States and China have agreed to lower tariffs on sixty billion dollars' worth of goods following a meeting between President Donald Trump and Chinese President Xi Jinping. The deal carves out a list of non-sensitive items from each country—sixteen hundred nineteen American products entering China and seventy-seven categories of Chinese goods heading to the United States—that will now face reduced duties aligned with standard World Trade Organization rates, which typically fall in the single digits though they vary by item.

The American goods eligible for tariff cuts span a wide range: corn, timber, medical equipment like X-ray machines, hair and personal care products. The list includes some unusual entries—whales designated for pure-bred breeding, emus, dugongs, and surgical robots. China's list of goods receiving favorable treatment focuses heavily on household items and seasonal goods: fireworks, toys, dolls, puzzles, glass and wooden Christmas ornaments, soccer balls, tableware, and household scales. Both countries said the lists could be adjusted later, though reviews would likely happen only once a year.

What the agreement notably excludes speaks as loudly as what it includes. American soybeans, the country's single largest export to China, did not make the cut. Neither did rare earth minerals or technology linked to artificial intelligence—categories that remain subject to significant trade restrictions on both sides. The omissions signal that while both nations are willing to ease tensions on everyday goods, they are protecting what they consider strategically sensitive sectors.

US Trade Representative Jamieson Greer framed the deal as focused on items that could benefit from more favorable treatment without compromising national interests. He suggested the agreement could improve market access for American farmers and businesses while allowing American consumers to pay less for imported household goods. China's commerce ministry said the arrangement would strengthen trade cooperation, with tariffs on more than ninety percent of the products moving to most-favoured nation status.

Economists view the agreement as a modest but meaningful step. Lynn Song, chief economist for Greater China at ING Bank, called it a potential first step in boosting bilateral trade. Shi Heling, an economics professor at Monash University, told the ABC that the deal demonstrated China and the United States had taken a substantive step toward cooling their trade conflict, even if the agreement represented only a fraction of total bilateral trade between the two countries. He noted that the timing could help both sides: Chinese household imports and Christmas-related goods receiving lower tariffs could help reduce inflation heading into the holiday shopping season, which matters politically as the United States approaches midterm elections in November when voters are sensitive to prices. For China, lower tariffs on American agricultural and medical products mean ordinary citizens pay less.

Shi acknowledged that some items on the lists—particularly the animals—appeared included mainly to pad the numbers and make the agreement look more substantial. He emphasized there was no guarantee this pact signaled movement toward a broader, long-term trade deal. The two countries did extend a trade truce through January 2027, but neither side disclosed the specific tariff reductions individual items would face or when implementation would begin.

For Australia, the agreement carries indirect benefits. James Laurenceson, director of the Australia-China Relations Institute at the University of Technology Sydney, said Canberra would welcome news that the world's two largest economies were better managing their trade relationship. For an open, trade-exposed economy like Australia, reduced tensions between Washington and Beijing generally work in favor of stable global commerce, though there are limited exceptions—moments when Australian producers could have sold goods to China while American competitors faced high tariff walls. Still, the pause in escalation and these modest reductions represent a development Australia's government would likely view positively.