China imposed significant tariffs on more than 100 imported American products on Sunday.
However, the White House has unveiled plans to impose new tariffs on about US$60 billion of Chinese imports over the "theft" of intellectual property (IP).
"There's not a lot booked past May now and there's a fear they are not going to book anything forward", a U.S. ethanol trader said of China.
The tariffs, effective Monday, will neutralize the cost savings from importing cheaper USA ethanol versus domestic supply, said three sources that participate in the market.
There's now a 15 percent tax on most US fruits including apples, pears, and cherries.
Farm country knew trade retaliation was inevitable, but that doesn't make a round of Chinese tariffs sting any less.
"The thing that is going to be more challenging for Beijing is if the U.S., European Union and Japan get together and start taking measures on state-owned enterprises", said Baig.
One area missing from China's tariff action was soybeans, which it buys in massive quantities.
This is because China wants to avoid a trade war, they say.
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The Chinese government hit back Monday at President Donald Trump's tariffs on steel and aluminum by acting on a threat to put tariffs as high as 25 percent on imports of 128 US -made products, including pork and seamless steel pipes.
But what worries the world, and has rattled investors is the last possibility: an escalating trade war, where both countries continue to introduce tariffs in the belief that they can outlast any short-term economic damage and tilt the bilateral trade relationship in their favor.
China wants to approach any negotiation with the USA on solid footing.
"It seems to be pretty measured and proportional", agreed Wendy Cutler, a former USA trade official who is now vice president at the Asia Society Policy Institute.
The U.S. Trade Representative's office has until April 6, 2018, to present the completed list.
After a month of public negotiations between the U.S. and several other countries, Monday marked the first time another country has formally placed tariffs on USA goods in response to the Trump administration's recent trade sanctions.
The tariffs are aimed at forcing changes to Chinese government policies that USTR says results in the "uneconomic" transfer of U.S. intellectual property to Chinese companies. Last year, U.S. exporters shipped 473,225 metric tons of seafood to China, worth more than $1.3 billion (€1.1 billion). When asked directly about China's retaliatory tariffs, a spokeswoman instead railed against the Asian power's trade tactics that prompted Trump's steel and aluminum penalties.
China announced earlier that it wasn't afraid of a trade war with the United States.
Chinese Vice Premier Liu He (劉鶴), the top economic official, last month told US Secretary of the Treasury Steven Mnuchin in a telephone call that the IP investigation violated global trade rules and Beijing was "ready to defend its national interests".
"I've always been sceptical of trade policy -- both at home and overseas -- that caters to big corporations instead of working families", she said.