State-owned agricultural buyers Cofco and Sinograin were told to stop buying U.S. soybeans, pork and other goods, according to a Bloomberg report confirmed by FOX Business. Private companies have not been told to pause their buys.
The move comes after President Trump announced on Friday his administration would take action to punish Beijing for passing a national security bill that bypassed Hong Kong’s legislature, effectively ending the “one country, two systems” governing principle that was guaranteed for the 50 years following Great Britain’s 1997 handover to China.
Trump directed his administration to “begin the process of eliminating policy exemptions that give Hong Kong different and special treatment” including agreements with Hong Kong on extradition, export controls on dual-use technologies and more.
The president also instructed his working group on financial markets to “study the differing practices of Chinese companies listed on the U.S. financial markets with the goal of protecting American investors.” Firms from China, and elsewhere, listed on U.S. exchanges do not have to follow the same accounting standards as American companies.
Beijing's agriculture purchases, which must total $50 billion under the partial trade deal, have gotten off to a slow start due to the COVID-19 pandemic, which originated in Wuhan, China.
U.S. customs data showed Beijing had purchased $3.1 billion of U.S. agricultural products in the three months through March. China's data showed those purchases totaled $5 billion.
The phase one trade deal signed in January calls for Beijing to buy an additional $200 billion of U.S. goods over the next two years, including $50 billion of agricultural products. The deal also says China must halt intellectual property theft, refrain from currency manipulation and cooperate in financial services. The U.S., for its part, reduced tariffs on some Chinese goods, but kept duties on $375 billion worth of products.
FOX Business' R.N. White contributed to this report.