Biden to Inherit Trump’s U.S.-China Trade War Upon Entering Office

It’s been a tumultuous four years for U.S. commodity industries that found themselves a key focus of the White House through its aggressive trade policy agenda.

From steel and aluminum tariffs to grain subsidies to boosting exports of liquefied natural gas, very few corners of the global commodities market eluded Donald Trump’s attention. There was at least one memo, executive order, pronouncement or tweet bringing some sort of attention to uranium, soybeans, and rare earths, the kinds of materials that haven’t received attention from American presidents in years.

Now, with Joe Biden winning the election, how will the next U.S. president diverge from his predecessor, and where he might keep the status quo?

Steel and Aluminum
The biggest issues in steel and aluminum are very similar, given these two industries -- especially steel -- were a top priority for the Trump administration. Tariffs aren’t expected to go away any time soon under Biden, and market participants have adjusted for the 25% duty on steel imports and the 10% levy on aluminum.

Removing them would be like catching a falling knife: It would alienate voters across the Midwest who helped Biden across the finish line. It would also lead U.S. Steel Corp. and Century Aluminum Co., among others, and the United Steelworkers union to lobby for some sort of new trade action to protect their industries.

Biden is more likely to maintain the tariffs and work with key allies -- including the European Union, Japan and Canada -- to form a bloc opposing the subsidies China gives to its industries, which produce more than half of the world’s steel and aluminum. The Trump administration openly shunned multilateral trade partnerships, so this would be a big change in policy. It’s still unclear, though, what policies Biden would enact to further protect the industries, both of whom claim need more help.

Trump administration officials criss-crossed Europe and Asia in 2019 touting U.S. LNG exports as “freedom gas” and “molecules of U.S. freedom,” but trade wars hurt sales as did environmental concerns over flaring in the Permian Basin and other emissions associated with production and shipment.

Biden didn’t state a position about LNG on his campaign website but boasts a plan to reduce methane emissions and flaring, which European buyers would welcome. Biden was vice president when the Obama administration approved permits for all six of the current LNG export terminals.

Political observers believe that Biden would bring the U.S. back into the Paris Agreement, an environmental treaty between nearly 200 nations to reduce greenhouse gas pollution. With buyers across the globe seeking greener or carbon-neutral LNG cargoes, the move might benefit U.S. exporters.

“Our biggest concern is American LNG exports to Asia and to Europe, and how those have declined as a consequence of some of these trade wars,” said Mike Sommers, the president of the American Petroleum Institute. As a previous longtime member of the Senate Foreign Relations Committee, Biden “has a firm understanding of how important American energy independence is from a foreign policy perspective as well,” he said.

Bloomberg Quicktake brings you live global news and original shows spanning business, technology, politics and culture. Make sense of the stories changing your business and your world.

Connect with us on…

[laragreene]

LOL...BIDEN ISNT GOING TO ENTER ANY OFFICE, HE'S GOING TO ENTER 😎😁😁😁 hOPEFULLY ALONG WITH THE LYING NEWS MEDIAS!! 🤢🤢🤢👍

[jessicablesses]

Honest to God. Why is the media so clueless

[tomjones]

The crayon eater hasn't won yet but, LARP away.

[abbeyjane]

We pay the tariffs. Would somebody please tell trump. He is clueless.

[kalenmartin]

Faithfully they put this country in better shape again

[scotteakins]

Wait till he has to deal with a Nationwide Trucker Blockade & Strike!

[twinapple]

Amen brother post below! May the colors of freedom never run!

[MoMotivation]

Right. To go ahead & hand the country over.

[martianari]

If Trump is working like that then why people are giving votes for Baiden....

[pablogalan]

He is one who had his clothing line made in China.Didnt know how the tariff works . Saying China would pay. So all did was racing there prices on what was coming in to the United States and what the needed from what our Farmers grow . China simply went to get them from another country.Which hurt our Farmers.

[motopeter]

yes, right on the pin, who can live with the pain longer.
and here you compare a strict dictatorship where peoppe still remember the great famine with 100 millions of deaths and a soft and conformist democracy.
which one stands longer?

[bettieboop]

Finally, an intelligent president. Biden/Harris 2020

[dejavu]

A less than 10 percent decrease in soybean price does in no manner justify this amount of opposition, unless this video is biased.

[reginawhite]

Don't think so, has anyone heard of congrats from their

[MrBears]

What’s the difference between Bush, Obama and Biden when it comes too China?

[johnbuttner]

or the right of the people peaceably to assemble, This part of the First amendment is not just for protests. We can peaceably assemble anywhere for any reason ie. business, social, or anything.

[znjbrtq]

ohh....just prepare potential cause of failure i job is to solve problem not to tell us what is the problem