It started with a kiss: how Jean-Claude Juncker wooed Donald Trump

Roman Schwartz
July 27, 2018

European Union imports of U.S. soybeans will remain strong for economic reasons with talks between U.S. President Donald Trump and European Commission President Jean-Claude Juncker giving them only a symbolic boost, European traders and analysts said.

The details of the deal brokered with European Commission chief Jean-Claude Juncker on Wednesday remain unclear and subject to differing interpretations, but the EU did ward off a new round of U.S. tariffs on autos and received a pledge to roll back duties on steel and aluminum.

Mr Juncker said the two sides agreed that as long as they were negotiating on trade, they would hold off on further tariffs, including potential U.S. tariffs on cars and auto parts. At a joint news conference in the White House's Rose Garden that afternoon, Trump and Juncker announced plans to de-escalate the crisis that was sparked by Trump's decision this year to slap tariffs on aluminum and steel exports from the E.U. The two agreed to hold off on further rounds of tariffs and committed to work toward a new bilateral trade deal.

Details are still being finalized, but included in the deal are commitments for European countries to buy more US soybeans and USA liquefied natural gas (LNG), while the White House will be looking to suspend or eliminate the tariffs that it imposed on steel and aluminum imports from the European Union. He added: "We're starting the negotiation right now but we know very much where it's going".

He said this is a "short-term" solution to help farmers and give President Donald Trump time to negotiate a longer term trade deal.

On a separate trade issue, Trump on Monday said he's heading toward a "dramatic" deal with Mexico, without giving more details. The escalating trade war and tariffs on steel and aluminum had put pressure on auto companies' earnings.

European Union buyers have already been stepping up purchases, with US supplies now available at a significant discount to exports from South America.

The Commission briefed European Union countries last week on the bloc's possible response, saying in theory it could hit 9 billion euros of US goods, according to European Union sources. For the time being, these new tariffs appear less likely to be instituted, but this is not the first time that the President has pulled back from the brink of a trade war, only to conduct an escalating foray if he feels his trade "foes" haven't submitted themselves fully enough to his freaky and counterfactual vision of the global trade order.

Treasury Secretary Steven Mnuchin said Thursday addressing steel and aluminum tariffs and counter tariffs would be covered in the first phase of talks between the USA and the EU.

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The administration recently announced a $12 billion temporary aid package for farmers - including soybean producers - dealing with the impact of retaliatory tariffs.

He told broadcaster Deutschlandfunk that the two could try to forge a lighter version of the planned U.S.

The agreements come amid heightened tensions between the USA and EU.

Agricultural equipment makers Deere & Co. and Agco both advanced, but General Motors, Ford and Fiat Chrysler all fell. "The EU is going to start to buy a lot more soybeans", Trump proudly declared.

This as Trump threatens to extend tariffs to European cars.

While presidents have generally received a printed "daily brief" containing the most important information gathered by the USA intelligence agencies over the previous 24 hours, according to the Washington Post, Trump insisted on a lavishly illustrated briefing document - and then he abandoned even that simplified approach, demanding that intelligence officials simply talk to him about the day's intelligence.

"Les Danielson has been in the farming business for the last 25 years, he raises about 500 acres of crops, 200 acres of corn, 200 acres of soybeans, dairy and beef cows", he said.

"I think they weighed what it would mean to open up a 50 billion euro trade nightmare", the official said.

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