U.S. and China agree to resume trade negotiations

U.S. and China agree to resume trade negotiations

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Stocks surged Thursday after Chinese ministers announced trade talks with the U.S are set to resume, as both sides have agreed to hold another round of negotiations in Washington next month.

President Trump said he is optimistic about a new deal, but he also said he is in no hurry to settle.

He used Twitter to put pressure on China, as he said the deal will get much tougher if he wins the 2020 election.

Phillip Johnson, a professor in the agriculture and applied economics department at Texas Tech, said producers are biting the bullet and may not be able to wait that long. 

"What we have right now is just basic uncertainty. It depends on how long this thing goes on. If it continues to go one for a while, what you're going to see is a reallocation and adjustment in trade flows. The short-term impacts of that, for instance, in cotton or soybean, the prices continue to go down," Johnson said.

For the long term, however, Tech agricultural economist Carlos Carpio, said he understands why the Trump administration is pushing hard for a deal with China.

"If the agricultural sector in the U.S. wants to continue growing, it needs to focus on these growing markets abroad. U.S. agriculture has the potential. It's very productive. It's probably first to none," Carpio said.

If a deal is not reached during this next wave of talks, both sides are threatening to raise tariffs before the end of the year.

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