USTR Grilled Over Tariffs

OMAHA (DTN) -- The Trump administration's chief trade negotiator defended the president's tariff plan -- set to take effect on Wednesday -- saying nearly 50 countries have already approached his office about negotiating deals that would reduce the U.S. trade deficit.

U.S. Trade Representative Jamieson Greer testified before the U.S. Senate Finance Committee, drawing attacks from Democrats over tariffs while some Republican senators also voiced skepticism or expressed concern about businesses and agriculture in their states.

Both stock and commodity markets on Tuesday appeared to rebound after repeated days of sharp declines. The S&P 500 and other stock indexes were in positive territory most of the day but fell before closing. Still, front-month corn and soybean contracts closed higher, and all of the wheat contracts finished higher as well.

Greer noted Trump used his authority to declare a national emergency and repeatedly pointed out during the hearing, "President Biden left us at a $1.2 trillion trade deficit." Greer said the Trump administration's decision to impose a minimum 10% tariff on every country -- and higher tariffs for other key trading partners -- marked, "the most significant change in trade policy since allowing China to join the World Trade Organization." Greer also repeatedly said the country had lost 5 million manufacturing jobs and 90,000 manufacturers since 1994.

"These are all serious indicators of an economic and national security emergency, and we can't ignore it," Greer said.

Greer also rejected the president's plan had resulted in a "trade war" despite trading partners such as China retaliating with a 34% tariff -- a move that led Trump to threaten another 50% tariff on China. Instead, Greer said nearly 50 countries had already reached out to his office about starting new negotiations.

"This is not a trade war. Most countries have said they are not going to retaliate," Greer said.

Greer also cited some announcements from auto manufacturers about shifting more production of parts to the U.S. to highlight the administration's plans were "already bearing fruit."

Greer also noted he and Treasury Secretary Scott Bessent would open new trade talks with Japan. Among the goals would be "more and better agricultural access," Greer said.

Greer said talks are beginning with both India and Vietnam as well. Greer said Vietnam has already lowered tariffs on products such as cherries, apples and nuts.

"Vietnam is one of those countries that understands that it is, frankly one of the major targets of this action because their trade surplus with us is so lopsided," Greer said.

Greer also pointed to tariff disparities that have led the country from an agricultural trade surplus in 2021 of $5 billion to an agricultural trade deficit of $38 billion in 2024, according to USDA.

Greer noted the average U.S. agricultural tariff is 5% while India's average is 39%. There are also disparities in particular products, such as Brazil charging an 18% tariff on imported ethanol while the U.S. tariff is 2.5%.

The U.S. has both a trade agreement with Australia and a joint defense agreement, but still imposed a 10% tariff on Australia. Greer pointed to beef and pork, citing Australia exported nearly $3 billion in beef to the U.S. last year, but buys no U.S. beef or pork.

"It's incredible that they do this, but we have zero fresh or frozen pork exports to Australia," Greer said.

Democrats at times focused on plunging stock markets and the impact on 401(k) funds. Sen. Ron Wyden, D-Ore., ranking member of the committee, questioned the plan for tariffs, noting some administration officials in interviews have said the tariffs are "bringing foreign countries to the table" while others have said tariff rates are not up for negotiation. Trump on Monday said both options are possible.

Wyden also indicated fruit growers in Oregon are being told buyers are not making purchases.

Agricultural groups are concerned about USTR next week making a decision to impose up to $1.5 million port fees on Chinese-built ships under Section 301 of the U.S. Trade Act. The National Grain and Feed Association, for instance, on Tuesday urged its members to call Congress, USDA, USTR and the White House to urge them not to impose the port fee.

Sen. Bill Cassidy, R-La., pointed out the flow of commodities through ports in his state from the Mississippi River. The potential $1.5 million fees would impact ships coming to ports and the ability to move goods down the Mississippi River. Cassidy asked if USTR is considering modifying its plan.

Greer had pointed out last year that the U.S. built just three large ships, compared to building thousands during World War II. Still Greer said the 301 actions against China are just "proposed actions" that could incentivize ship building in the country.

"They are not all going to be implemented. They are not all going to be stacked," Greer said of possible actions against Chinese ships.

Greer said USTR had heard from a range of stakeholders at hearings last week and those comments are being reviewed. Greer said the president is looking for ways to incentivize ship building in the U.S. "without impacting our commodity exports."

Sen. Catherine Cortez Masto, D-Nev., talked about her state being hit because Canadians and other tourists are canceling plans to come to the U.S. She also questioned how the Trump administration would plan to quickly reach trade deals when it took over two years to renegotiate NAFTA into the U.S. Mexico Canada Agreement. "And now you are telling us you have nearly 50 countries coming to you, approaching you to enter into a negotiation and you think you can do that overnight?" Cortez Masto said.

Sen. Chuck Grassley, R-Iowa, said he supports Trump's agenda to get a better deal in China for agriculture and manufacturers. Still, Grassley co-sponsored a bill that would limit Trump's tariff authority. Grassley said he supports tariffs to reach better trade. "On the other hand, if the purpose is to stall on negotiations in order to keep tariffs high for the sole purpose of feeding the U.S. Treasury, I oppose that."

Greer responded that tariffs would vary based on responses by other countries. "I think the answer senator is it is going to be country-by-country."

Sen. Steve Daines, R-Mont., said he shares the president's determination to end unfair trade barriers, "but I hope we can avoid an all-out trade war." Daines added, "There is hope these tariffs are a means, and not solely an end."

Daines then talked about bringing beef from Montana to China in 2017 that led to China buying more than $1 billion in beef annually -- $1.6 billion in 2024. But those exports have stopped over the past month as China has frozen certifications for U.S. beef packers.

"The valve is shut for U.S. beef producers," Daines said.

Sen. Ron Johnson, R-Wis., said the committee agrees the U.S. has been taken advantage of by trading partners, but he also said every lawmaker has businesses that rely heavily on trade. Johnson said the Trump administration should take a closer look at excluding certain products from tariffs and suggested some small businesses are going to go bankrupt. Johnson called tariffs "a blunt instrument" to use.

"There's going to be an awful lot of collateral damage, and I hope you are sensitive to that." Johnson said.

Greer said tariffs and U.S. trade policy overall will not be quickly resolved because of the $1.2 trillion annual trade deficit.

"The trade deficit has been decades in the making and it's not going to be solved overnight," Greer said.

See, "China Responds to Tariffs: Markets Drop," https://www.dtnpf.com/…

Also see, "Farmer Testifies at USTR Hearing That Proposed Fees Will Harm US Farmers," https://www.dtnpf.com/…

Also see, "Rollins Defends Tariff Strategy and Talks About Ag Trade Barriers," https://www.dtnpf.com/…

Chris Clayton can be reached at Chris.Clayton@dtn.com

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