U.S. Tariffs on China Poised for Major Hike Tuesday Without Agreement

U.S.-China Trade Truce Nears Expiration Amid Tariff Threats

Deadline Approaches for Economic Cease-Fire

President Donald Trump has not yet formally approved an extension of the current trade truce with China, which is set to expire Tuesday. Without a new agreement or an extension, steep tariffs on Chinese imports would be reinstated, prompting likely retaliation from Beijing against U.S. goods. The standoff risks reigniting a trade war between the world’s two largest economies — one that rattled global markets earlier this year.

Talks in Sweden and Lingering Uncertainty

Last month, negotiators from both sides reached a provisional agreement in Sweden to prolong the truce, sparking optimism among Trump’s economic advisers. But so far, the president has not confirmed the extension. Asked about the looming deadline on Monday, Trump gave little away, saying only, “We’ll see what happens,” while emphasizing his “very good” relationship with Chinese President Xi Jinping.

Soybeans and Trade Demands

On Sunday night, Trump urged China to quadruple purchases of American soybeans, calling it a step toward reducing the U.S. trade deficit. Posting on Truth Social, he highlighted China’s shortage of soybeans and touted U.S. farmers’ superior crops. Since 2023, the two nations have held three rounds of formal trade talks, with tariffs on Chinese goods peaking at 145 percent before the 90-day truce lowered them to 30 percent. China, in turn, reduced tariffs on U.S. imports to 10 percent and resumed exporting rare earth magnets critical for American manufacturing.

Possible Tariff Hike to 80 Percent

If no agreement is reached, U.S. Trade Representative Jamieson Greer warned tariffs on Chinese imports could surge to 80 percent. Treasury Secretary Scott Bessent downplayed the likelihood, suggesting only technical details were unresolved. Still, talks now span beyond tariffs to issues like China’s excess manufacturing capacity, purchases of oil from Russia and Iran, and U.S. export controls on advanced microchips used in artificial intelligence.

Microchip Negotiations and Financial Arrangements

Despite national security concerns, the Trump administration has taken a transactional approach to semiconductor trade. Nvidia and AMD are reportedly set to pay the U.S. 15 percent of revenue from A.I. chip sales to China under a rare financial agreement with Washington.

Other Trade Deals in the Mix

Parallel to China negotiations, the U.S. has struck trade deals with Japan, South Korea, and the European Union, securing major investment pledges in return for reduced tariffs. Trump has also used tariffs to pressure other countries — recently doubling tariffs on Indian imports to 50 percent over New Delhi’s refusal to scale back Russian oil purchases.

The Complex U.S.-China Relationship

While China also imports Russian crude, Washington has so far avoided linking this to new tariffs. Vice President JD Vance said such measures remain “on the table” but noted Trump is weighing the strategic complexity.

History and Future of Trade Talks

Trump and Xi previously reached a broad trade pact during his first term, which included Chinese commitments to buy billions in U.S. farm goods — commitments largely unfulfilled due to the pandemic and worsening relations. Trump has expressed openness to meeting Xi, but only if a trade deal is in place. “If we don’t make a deal, I’m not going to have a meeting,” he said last week.