Toys, Mobile Phones & Soybeans

With Donald Trump officially inaugurated as the 45th President of the United States of America, trade relations with China may be about to get serious.

In 2015, imports from China accounted for 21% of the total imports by the US,^[1] while exports to the US contributed 18% of China’s total exports.^[2]  Conversely, exports to China in the same year contributed 8% of the total exports by the US,^[3] while US imports amounted to 9% of China’s total imports.^[4]

The following table compiled by the Evercore ISI research group highlights some interesting observations.  In eight of the top 10 categories of US imports from China (electronics, toys, apparel and other consumer products), 50% or more of the goods sold in the US are sourced from China.  Cheap mobile phones may be hard to come by for US consumers if supplies from China are constricted.  On the other hand, US farmers and producers of soybeans, barley and oats may be easy targets should China decide to retaliate, as the majority of US production of these crops have been headed for the Chinese market.

Who do you think will come off worse in a trade war?  The question, of course, relates to the first-order effects rather than the full implications globally.

[1] Calculation based on data from the US Census Bureau.

[2] Calculation based on data from the National Bureau of Statistics of China.

[3] Calculation based on data from the US Census Bureau.

[4] Calculation based on data from the National Bureau of Statistics of China

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