The low intensity trade war between China and America saw notable impact in agriculture and biofuels exports. It also impacted oil exports and in general economic growth that supports oil consumption. With the January 15, 2020, signing of the Phase 1 trade agreement much of the pressure has been relieved. Here is the feedback from around the biofuels community:

API President and CEO Mike Sommers: “The phase one trade deal reached between the U.S. and China is a positive step forward, creating greater certainty across the American economy. Although the U.S. leads the world in energy development, trade wars disrupt global supply chains and create new barriers to U.S. exports. De-escalation of trade tensions is welcome news to a wide range of industries, but there’s more work to be done. We encourage the administration to stay at the negotiating table until the U.S.-China marketplace for energy trade is fully restored and all remaining tariffs are lifted — including U.S. tariffs on imports of industrial components used in our industry and Chinese retaliatory tariffs on U.S. energy exports.”

Renewable Fuels Association President and CEO Geoff Cooper: “We are very optimistic about the potential of this agreement for American agriculture and the renewable fuels industry—with the inclusion of ethanol and key co-products like distillers grains—and are looking forward to more specific details on the agreement. America’s ethanol producers have experienced significant economic losses due to punitive Chinese tariffs on our products, and we are eager to return to a more open trading relationship with China. Chinese consumers understand that using ethanol can lower fuel prices and help address major air quality concerns in urban areas across the country. In addition, the ethanol industry’s animal feed co-products are an economical source of nutrition for China’s livestock and poultry sector.

“We hope this deal reopens the door immediately for meaningful exports of both ethanol and feed co-products to China, and we thank President Trump, the U.S. Trade Representative, and U.S. Department of Agriculture for their efforts to reopen the Chinese market to U.S. agricultural and energy products. And like President Trump in his remarks right before the signing, we also appreciate the hard work of Sens. Chuck Grassley, Joni Ernst and Deb Fischer as true champions for ethanol.”

American Coalition for Ethanol (ACE) CEO Brian Jennings: “Phase one represents a positive step in the right direction, especially once we have evidence that China has made actual purchases of U.S. ethanol and distillers grains, but given ongoing export and domestic market constraints, there is much more work to do. The signing of this partial trade deal with China doesn’t erase the pain still being felt at home due to the artificial lid EPA’s mismanagement of the Renewable Fuel Standard has placed on domestic ethanol demand. Further, today’s trade agreement follows reports that China suspended its plan to implement an E10 nationwide mandate this year, raising more uncertainty for the industry. We remain hopeful the next phase of talks with China can conclude with the restoration of a robust and enforceable trade relationship.”

Growth Energy CEO Emily Skor: “The signing of the Phase One trade agreement with China today is another positive step towards restoring market confidence for U.S. biofuel producers,” said Skor. “We’re grateful to U.S administration officials for their continued work on securing this trade agreement at such a pivotal time for our nation’s agriculture and renewable energy industries. Breaking down trade barriers between our nations will provide a valuable opportunity to restore demand for American biofuel, and we hope to soon see biofuels and DDG exports back on the Chinese market.”

 

The trucking industry also see a win in the trade developments.

ATA President and CEO Chris Spear: “The signing of this agreement with China is good for our industry, which is significantly impacted by trade. It will give a boost to U.S. manufacturers and exporters of American goods and provide certainty to the supply chain – all of which will positively impact the trucking industry. It is our hope that leaders in both China and the United States will build on this promising first step and move forward to forge a broader agreement promoting fair and equitable trade between our two countries.”