Washington and Beijing weigh reciprocal tariff cuts on roughly $30 billion in farm goods, energy and manufacturing inputs as Xi Jinping prepares for a Sept. 24 White House visit, with the survival of the one-year trade truce riding on the outcome.
WASHINGTON, Sept. 16, 2026. American and Chinese negotiators are discussing a package of mutual tariff reductions covering agricultural shipments, energy cargoes and industrial inputs, a development that trade officials on both sides view as the clearest signal yet that the tariff truce struck between the two economies in October 2025 will be extended rather than allowed to lapse.
Bloomberg News reported on Sept. 15, citing people familiar with the private conversations who spoke on condition of anonymity, that the two governments are weighing cuts that would be carried out under an earlier framework for reciprocal reductions on roughly $30 billion in bilateral trade. According to that reporting, most-favored-nation rates would be applied to certain items originating in China, and the meetings are also likely to produce an agreement lowering duties on Chinese inputs used by American manufacturers.
The timing is deliberate. President Donald Trump has said that President Xi Jinping will visit the White House on Sept. 24 for a meeting that is expected to include a state dinner. Beijing had not confirmed the travel dates as of this week, a reticence consistent with Chinese practice of announcing senior travel only days in advance.
A weekend meeting before the summit
Treasury Secretary Scott Bessent told the House Financial Services Committee on Sept. 15 that he would meet his Chinese counterpart, Vice Premier He Lifeng, over the coming weekend. “We have had some very good private discussions, and I look forward to those continuing this weekend when I meet my Chinese counterpart,” Bessent said, according to accounts of the testimony published by Bloomberg, Agence France-Presse and the South China Morning Post.
Bessent framed the meeting in part around economic pressure on Iran, a subject that has dominated Treasury’s public messaging in recent weeks, but the session lands four days before the Trump and Xi meeting and is understood on both sides of the Pacific to be the last senior-level opportunity to settle the shape of any tariff announcement. Bessent did not disclose the date or venue of the meeting.
For importers and exporters, the sequencing matters more than the atmospherics. Tariff reductions of the kind under discussion are not self-executing. They require either a presidential proclamation, a Federal Register notice from the Office of the U.S. Trade Representative, or an amendment to the Harmonized Tariff Schedule of the United States, each with its own effective date and entry-filing consequences. A deal announced on Sept. 24 could take days or weeks to appear in the tariff schedule, and companies that plan entries around a headline rather than a published notice risk mis-declaring duties.
What is actually on the table
Three baskets appear to be in play, based on the reporting and on public statements by U.S. officials.
The first is agriculture. China is working through a commitment to purchase 25 million metric tons of American soybeans annually through 2028 and recently passed the halfway point for the 2026 marketing year, according to Bloomberg. Separately, the White House said in May that Beijing had committed to buy at least $17 billion of U.S. agricultural products each year on top of the soybean volumes, with the 2026 target prorated. Underscoring how central agriculture has become to the relationship, representatives of Cofco, the Chinese state-owned food trading group, may accompany Xi on the trip, and more than a dozen companies are under consideration for a chief executive delegation, according to people familiar with the planning.
U.S. Trade Representative Jamieson Greer told Fox News earlier this month that he expected “announcements on agriculture and nontariff barriers related to agriculture” during the visit. That last phrase is the one American exporters have focused on. Sanitary and phytosanitary approvals, registration renewals for U.S. processing facilities, and biotechnology event approvals have historically been the binding constraint on American farm sales to China, more so than the tariff line itself. A commitment that moves those files would be worth considerably more to U.S. agriculture over a multiyear horizon than a single-digit duty reduction.
The second basket is energy. American liquefied natural gas, crude oil and refined products have been among the most tariff-exposed U.S. exports to China through successive rounds of retaliation, and Chinese buyers have largely rerouted purchases to other suppliers. Restoring tariff-free or reduced-duty access would not instantly rebuild the trade, because long-term offtake contracts and shipping arrangements take time to reconstitute, but it would reopen a channel that American producers have treated as effectively closed.
The third basket is manufacturing inputs. This is the element that most directly touches U.S. importers. Lowering American duties on Chinese components, chemicals, and intermediate goods used by domestic producers would cut input costs for manufacturers that have spent two years absorbing layered tariffs. Greer also said he expected the Board of Trade, the bilateral mechanism announced when Trump met Xi in Beijing in May, to produce announcements on toys, games and fireworks that might shield those categories from future tariffs or other trade measures. Those three product families are heavily concentrated in Chinese production and have limited near-term alternative sourcing, which has made them a recurring pressure point for American retailers and distributors.
Background: a truce that has held longer than expected
The October 2025 truce paused an escalatory cycle that had pushed average applied rates between the two economies to levels without modern precedent. It was reinforced in May 2026, when Trump traveled to Beijing with a delegation of more than a dozen chief executives, including Nvidia’s Jensen Huang and Tesla’s Elon Musk. The executives met Premier Li Qiang, and Xi told them that American enterprises “are deeply involved in China’s reform and opening up, a process from which both sides have benefited.”
That trip produced the Board of Trade, a standing consultative body intended to give both governments a venue for working through irritants without resorting immediately to tariff action. The body has been criticized in Washington as a talking shop. A concrete deliverable in the form of reciprocal tariff cuts would be the first evidence that it can produce results.
The scale of the contemplated package should be kept in proportion. Bilateral goods trade exceeded $400 billion in the first eight months of 2026. A reciprocal reduction touching roughly $30 billion in trade is therefore a narrow slice, covering something on the order of seven percent of the two-way flow. Its significance is less economic than political: it demonstrates that the two governments can still transact, at a moment when they are diverging sharply on artificial intelligence policy, export controls on advanced computing, and the status of Taiwan.
The legal ground has shifted underneath
Any assessment of what a U.S. tariff cut would mean has to account for the extraordinary reshaping of American tariff authority that occurred earlier this year. In February 2026, the Supreme Court held in Learning Resources, Inc. v. Trump that the International Emergency Economic Powers Act does not authorize the president to impose tariffs. U.S. Customs and Border Protection ceased collecting IEEPA duties on Feb. 24, 2026, and the related executive orders were rescinded.
The administration then pivoted to Section 122 of the Trade Act of 1974, which permits a temporary surcharge of up to 15 percent for a maximum of 150 days. That authority ran from Feb. 24 to July 24, 2026, and the Court of International Trade held in August that the 10 percent global rate imposed under it was unlawful because the statutory balance-of-payments predicate was not satisfied.
On July 23, 2026, the president directed USTR to impose duties under Section 301 of the Trade Act of 1974 on 60 trading partners arising from forced-labor investigations. Those duties, set at 10 percent or 12.5 percent depending on each economy’s forced-labor import prohibition status, took effect July 24, the day Section 122 expired. China is among the economies subject to the 12.5 percent rate.
The practical consequence is that the American tariff wall facing Chinese goods is now assembled from Section 301 measures, the long-running China-specific Section 301 lists dating to the first Trump term, and an expanding set of Section 232 national security actions covering steel, aluminum, copper, semiconductors, pharmaceuticals, unmanned aircraft systems, polysilicon and other categories. Each sits on a different statutory footing with different procedural requirements.
That matters for the negotiation. A reciprocal tariff cut delivered through Section 301 exclusions or rate modifications is administratively straightforward: USTR can act by notice. A cut that would require unwinding a Section 232 measure is harder, because Section 232 actions rest on a Commerce Department national security finding and are politically difficult to reverse. The USTR fact sheet accompanying the July forced-labor action expressly exempted “all articles and parts of articles subject to section 232 tariffs” from the new duties, a drafting choice that reflects how thoroughly Section 232 has become the load-bearing element of the tariff structure.
Importers should therefore read any announcement carefully for which authority is being adjusted. Relief on the Section 301 layer leaves Section 232 duties intact on the same merchandise. A product subject to both will see only partial relief.
Stakeholder reactions
USTR, China’s Ministry of Commerce and Cofco did not respond to requests for comment from Bloomberg on the reported discussions, and neither government has confirmed the contours of a package.
American agricultural interests have been the most vocal constituency pushing for a deal. Soybean growers in particular have spent two years watching Brazilian producers consolidate market share in China, and the purchase commitments now in place are viewed within the sector as a floor rather than a restoration. Grain handlers and crush operators have noted that the 25-million-ton annual figure, while large, is measured against a Chinese import book that has repeatedly exceeded 90 million tons.
Manufacturers that rely on Chinese inputs have pressed for the third basket. Trade associations representing durable goods producers have argued through successive comment dockets that layered duties on components raise the delivered cost of domestically assembled products and erode the competitive position the tariffs were meant to protect. Reduced duties on inputs address that complaint directly.
Retailers and importers of consumer goods have focused on the toys, games and fireworks categories Greer mentioned. Those sectors are dominated by small and midsize importers with thin margins and limited capacity to absorb duty increases or to qualify alternative suppliers quickly.
On the skeptical side, domestic producers in import-competing sectors have warned that reducing duties on Chinese inputs risks re-establishing the sourcing patterns the tariffs were designed to break, and that reciprocal cuts hand Beijing a concession in exchange for purchase commitments that have historically been difficult to enforce.
Economic impact analysis
The direct arithmetic of a $30 billion reciprocal package is modest. If the American half of the reduction covered roughly $15 billion in imports and cut the applicable rate by ten percentage points, the annualized duty saving to U.S. importers would be on the order of $1.5 billion. Against total collections that ran into the tens of billions in the current fiscal year, that is a rounding adjustment at the aggregate level.
The distributional effect is where it becomes material. Duty relief concentrated in manufacturing inputs, toys, games and fireworks would flow to a defined set of industries in which tariff costs represent a large share of landed value and where pass-through to consumers has been most visible. For a mid-market importer bringing in $40 million of covered goods a year, a ten-point reduction is a $4 million swing in gross margin, which is the difference between a viable and an unviable product line.
On the export side, the value of restored Chinese access to American energy and farm goods depends heavily on whether the nontariff elements move. Tariff relief without registration and approval relief delivers a fraction of the potential volume. This is the central uncertainty in assessing the package, and it is why Greer’s reference to nontariff barriers drew more attention among trade practitioners than the tariff figure itself.
There is also a macro dimension. Extension of the truce removes, for another year, a tail risk that has been embedded in supply chain planning, capital expenditure decisions and inventory policy since 2025. Firms have been carrying elevated safety stock and paying for dual sourcing as insurance against renewed escalation. A credible extension allows some of that insurance cost to be released, which shows up as working capital freed rather than as a headline tariff saving.
Implications for importers and exporters
Several practical points follow for U.S. businesses.
First, do not act on the announcement. Act on the notice. Duty rates change when the Harmonized Tariff Schedule changes. Entries filed on the basis of press reporting, before a Federal Register notice or CBP guidance message establishes the effective date and the covered subheadings, expose the importer to penalties and to the cost of post-summary corrections.
Second, map each affected product to every layer of duty it carries. A single article may be subject to a China-specific Section 301 rate, the July 2026 forced-labor Section 301 rate, a Section 232 rate if it is a covered steel, aluminum, copper or derivative product, and the ordinary most-favored-nation rate. Relief on one layer does not touch the others, and the exemption architecture in the July action means Section 232 goods sit outside the forced-labor duties entirely.
Third, review entries made during the IEEPA and Section 122 periods. Refund exposure from the Supreme Court decision and the subsequent Court of International Trade ruling on Section 122 remains substantial, and CBP has been processing claims through a dedicated channel. Companies that have not filed protective claims should confirm with counsel whether their liquidation windows remain open.
Fourth, exporters to China should prepare documentation now rather than after an announcement. If nontariff commitments materialize, the constraint on capturing volume will be facility registration status, phytosanitary certification and contract capacity, not the duty rate. Firms that are already registered and certified will move first.
Fifth, build the possibility of no deal into the plan. Neither government has confirmed a package, delegation composition has not been finalized, and the two sides remain in open disagreement on export controls and Taiwan. A summit that produces a communique and no tariff schedule change is a plausible outcome.
Sectoral exposure: who gains and who does not
Not every American importer stands to benefit equally, and the distribution of relief will be determined by tariff engineering details that will only become visible when the covered subheadings are published.
Consumer goods importers in the toys, games and fireworks categories are the clearest potential winners, if Greer’s forecast of Board of Trade announcements in those areas is borne out. These categories share three features that make them unusually tariff-sensitive: production is heavily concentrated in China, unit values are low enough that duty represents a large percentage of landed cost, and the supply base is difficult to relocate because it depends on specialized tooling, seasonal labor and regulatory certifications that take years to replicate. Importers in these sectors have absorbed successive rounds of duty increases by compressing margins, deferring product development and, in the case of fireworks, drawing down inventory positions that in some cases were built years in advance.
Industrial buyers of Chinese intermediate goods form the second group. Chemical intermediates, electrical components, precision fasteners, bearings, castings and subassemblies enter the United States in volumes that dwarf the finished-goods trade, and they are consumed by American factories. Duty relief here reduces the cost base of domestic manufacturing rather than the cost base of imported competition, which is why manufacturing trade associations have pressed for it through successive comment dockets.
The groups least likely to see relief are importers of goods covered by Section 232 actions. Steel, aluminum, copper and their derivative articles, semiconductors, pharmaceuticals and their active ingredients, unmanned aircraft systems and their components, and polysilicon and downstream solar products all sit under national security determinations that the administration has shown no inclination to unwind. A negotiated package with China is unlikely to touch them. Importers whose merchandise falls under a Section 232 inclusion should assume their duty position is unchanged regardless of what is announced on Sept. 24.
A fourth group deserves mention: firms that have already relocated sourcing out of China at substantial cost. Companies that spent 2025 and 2026 qualifying suppliers in Vietnam, India, Mexico, Thailand and elsewhere now face the prospect that the arbitrage which justified the move narrows. Those decisions are rarely reversible in the short run, because tooling transfers, qualification testing and minimum order commitments lock capacity for multiple seasons. For these firms the policy risk runs in the opposite direction from the industry consensus.
Logistics and working capital effects
Tariff changes propagate through freight and inventory decisions faster than they propagate through pricing. If a reduction is announced with a forward effective date, the predictable response is deferral: importers hold shipments at origin or slow-steam cargo to land entries after the change takes effect. The mirror image occurred repeatedly during the escalation phase, when announced increases pulled volume forward and produced transpacific rate spikes followed by sharp corrections.
Customs brokers and freight forwarders have accordingly begun advising clients to model both scenarios ahead of the summit. A cut effective on publication rewards cargo already in transit. A cut effective 30 days after publication rewards cargo that has not yet sailed. The difference between those two drafting choices can be worth more to a mid-sized importer than the rate change itself.
There is also a bonded warehouse and foreign trade zone dimension. Merchandise held in a bonded warehouse is assessed at the rate in effect when it is withdrawn for consumption, which makes bonded storage a hedge against an expected reduction. Foreign trade zone treatment depends on privileged or non-privileged foreign status elections made at admission, and those elections are generally irrevocable. Firms with FTZ operations should review pending admissions before any announcement rather than after.
Risks to a deal
Several factors could prevent a package from materializing or limit its scope.
The two governments remain in open disagreement on export controls covering advanced computing hardware, an area where Beijing has repeatedly characterized U.S. measures as unilateral coercion. China voiced what it described as serious concern over new American restrictions during senior trade talks earlier this year. A tariff package does not resolve that dispute and could be held hostage to it.
Taiwan remains the most consequential source of downside risk. Any deterioration in the security environment in the Taiwan Strait would overwhelm a $30 billion tariff arrangement.
Enforcement history also constrains ambition on the American side. Purchase commitments negotiated in the first Trump term were not met in full, and that experience has made U.S. negotiators reluctant to trade durable tariff reductions for volume pledges. A structure in which American cuts are staged or conditioned on verified purchases is more likely than an immediate across-the-board reduction.
Finally, the domestic politics of tariff relief are not straightforward. The administration has invested considerable political capital in the proposition that tariffs are producing reshoring and revenue. Reductions that are framed as concessions rather than as reciprocal gains carry a cost, which argues for a package presented as a Chinese opening rather than an American retreat.
What to watch
The near-term markers are the Bessent and He meeting this weekend, any readout that follows it, confirmation from Beijing of Xi’s travel dates, and the composition of the Chinese business delegation. Cofco’s presence would point toward an agriculture-weighted package. A broad chief executive delegation across technology and manufacturing would suggest a wider scope.
After the summit, the operative documents will be the Federal Register notice or proclamation implementing any U.S. reduction, CBP’s CSMS guidance messages, and the corresponding announcement from China’s Ministry of Commerce or Customs Tariff Commission of the State Council. Until those appear, the tariff schedule is unchanged and importers should file accordingly.