US readies second wave of tariffs as China hits back - with a surprise

Beijing/Washington - Tit-for-tat measures bring economic superpowers on the brink of full-blown trade war

The United States has nearly completed a second list of tariffs on $100 billion in Chinese goods, as President Donald Trump prepares to enact an initial round of duties that is expected to trigger an in-kind response from Beijing, several sources said.
The second wave of products has been cued up. They are part of Trump's decision to go forward with "pretty significant" tariffs, an administration official said.
In response, China's commerce ministry warned Trump's tariffs "threaten China's economic interests and security", in a statement outlining Beijing's response.
The ministry issued two lists of American goods - worth $50 billion in total - which will be hit with a retaliatory 25 per cent tariff.
Initially, 545 US products valued at $34 billion will be targeted, mimicking the tariff rollout by the Trump administration.
These include major American exports to China like soyabeans, which brought in $14 billion in sales last year, and are grown in states that supported Trump during the 2016 presidential election.
Politically-important exports like other agricultural products and automobiles also made the list.
Beijing also surprised oil markets with threats to levy tariffs on imports of US crude oil, natural gas and other energy products, just as China has risen to the top of the list of importers of oil from the US.
China action on US energy products was considered a surprise by analysts as previous tariff threats had centered on agricultural goods and automobiles.
"This is a big deal. China is essentially the largest customer for US crude now, and so for crude it's an issue, let alone when you involve [refined] products, too. This is obviously a big development," said Matt Smith, director of commodity research at ClipperData.
The US' $100 billion list will be subject to the same public comment and hearing process as the $50 billion list, so it could take 60 days or more to put into effect, three sources familiar with the Trump administration's thinking on tariff plans told Reuters.
The list is intended to minimise the impact on US consumers and businesses by selecting goods where there are ample alternative supplies from other countries. Eliminating any impact may be impossible. "There's no question, that to get to $100 billion you're going to hit consumer products coming in from China," a person briefed by Commerce Secretary Wilbur Ross told Reuters.
This person also said Ross had said the list would take aim at products for which China supplied 33 percent or less of total US imports in individual product categories, making it easier to shift to other countries' supplies. The person, like the other sources familiar with the administration's thinking, declined to be identified because they were not authorised to speak to the media.