Beijing Buckles, Quietly Suspends 125% Tariff on Major U.S. Export [WATCH]

In a significant move during ongoing trade tensions, China on Tuesday waived a 125 percent tariff on U.S. ethane imports, according to a report from Reuters.

The tariff, originally imposed as part of China’s retaliation against President Donald Trump’s trade policies, had severely restricted U.S. ethane exports to the country.

JUST IN: 🇨🇳🇺🇸 China removes 125% tariff on US ethane imports, Reuters reports. pic.twitter.com/PuhFkbvgcb

— BRICS News (@BRICSinfo) April 29, 2025

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The Trump administration has treated the removal of the ethane tariff as a possible signal that the Chinese Communist Party may be preparing to reengage in trade negotiations.

The administration has maintained a hardline approach with Beijing while offering reduced tariffs to other trading partners in exchange for negotiations.

A 90-day pause on tariffs affecting other nations was introduced by President Trump, setting baseline duties at 10 percent.

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Tariffs on Chinese goods, however, remained in place and, in several sectors, increased substantially—including the now-suspended 125 percent ethane tariff.

According to the U.S. Energy Information Administration, China accounts for nearly half of the United States’ annual ethane exports.

Ethane, a key feedstock for the petrochemical industry, is used in the production of plastics and other materials. U.S.-based energy firms like Enterprise Products Partners and Energy Transfer are among the largest suppliers.

Major Chinese buyers include Satellite Chemical, SP Chemicals, Sinopec, Sanjiang Fine Chemical, and Wanhua Chemical Group.

The exemption on ethane follows a broader trend by Beijing to reduce or lift tariffs on certain high-demand U.S. goods.

Just last week, China announced tariff exemptions on pharmaceuticals, microchips, and aircraft engines.

In addition, the Chinese government reportedly requested domestic firms to submit lists of key imports that should be considered for future exemptions.

U.S. Treasury Secretary Scott Bessent responded to the news during a White House press briefing on Tuesday, framing the move as a win for the administration’s trade strategy.

“I think that over time we will see that the Chinese tariffs are unsustainable for China,” Bessent said.

“I’ve seen some very large numbers over the past few days that show if these numbers stay on, Chinese could lose 10 million jobs very quickly. And even if there is a drop in the tariffs that they could lose 5 million jobs.”

Bessent pointed to the disproportionate nature of U.S.-China trade as a key factor driving China’s tariff recalculations.

“So remember that we are the deficit country,” he continued.

“They sell almost five times more goods to us than we sell to them. So the onus will be on them to take off these tariffs. They’re unsustainable for them.”

The treasury secretary also suggested that progress is being made on trade talks with other Asian partners, especially India.

He noted that Vice President J.D. Vance recently visited India and held productive discussions with Indian Prime Minister Narendra Modi.

“They have been the most forthcoming in terms of doing the deals,” Bessent said.

“As I mentioned, Vice President Vance was in India last week. I think that he and Modi made some very good progress. So I could see some announcements on India.”

Negotiations with South Korea and Japan also appear to be underway, with Bessent indicating that new trade agreements with both nations could materialize within the coming weeks.

.@SecScottBessent on tariffs: “We had a very successful bilateral meeting with the Republic of South Korea today. We may be moving faster than I thought — and we will be talking technical terms as early as next week.” pic.twitter.com/wZGl9Ug8cU

— Rapid Response 47 (@RapidResponse47) April 24, 2025

The easing of China’s ethane tariff could mark a critical moment in the evolving trade relationship between Washington and Beijing.

While significant issues remain unresolved, the Trump administration views the move as a positive indication that Beijing may be prepared to shift course under mounting economic pressure.

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