US-China Summit Delivers Tariff and Trade Framework

30 September 2026

Executive Summary

The US-China summit has produced several concrete commercial agreements, creating potential opportunities for businesses while leaving major areas of trade friction unresolved.

Following President Donald Trump and President Xi Jinping’s meeting in Washington, the two countries have agreed a framework under which approximately $30 billion of goods in each direction could receive reduced tariff treatment.

Under the proposed arrangement, tariffs on approximately 90% of the products covered by the framework would ultimately fall to most-favoured-nation tariff levels.

The countries have also formally established a US-China Board of Trade and a separate Board of Investment intended to provide structured channels for resolving commercial and investment issues.

An agricultural working group has also been established.

China has additionally agreed to import at least 10 million metric tonnes of US coal in 2027 and another 10 million tonnes in 2028.

However, significant commercial uncertainties remain.

The tariff reductions still require implementation through each country’s domestic legal procedures.

US soybeans — America’s largest agricultural export to China — were excluded from the proposed tariff relief.

And negotiations concerning rare earths and other critical minerals remain ongoing.

The summit has reduced some trade uncertainty, but businesses should distinguish between political agreement, regulatory implementation and actual commercial demand.

UK Impact

UK businesses may be affected indirectly through changes in global trade flows.

Potential consequences include:

• Commodity pricing.
• Agricultural markets.
• Critical-mineral availability.
• Manufacturing supply chains.
• Chinese sourcing.
• US sourcing.
• Shipping demand.
• Investment flows.

Reduced tariffs between the world’s two largest economies could redirect some trade away from alternative suppliers that benefited during earlier US-China trade tensions.

Conversely, unresolved tariffs may preserve opportunities for suppliers elsewhere.

Global Impact

The proposed tariff framework covers approximately $30 billion of goods imported by each country from the other.

US products identified for potential favourable treatment include:

• Agricultural products.
• Fish and seafood.
• Logs and wood products.
• Cosmetics.
• Medical devices.

Chinese products potentially benefiting include consumer goods such as:

• Small appliances.
• Toys.
• Holiday decorations.
• Children’s car seats.

The two countries have also created a Board of Investment intended to discuss investment opportunities and barriers affecting cross-border investment.

However, some strategically important issues remain unresolved.

The United States continues to raise concerns about supplies of rare earths and critical minerals.

The two governments say they will continue working towards restoring appropriate shipment levels.

Agricultural trade also remains uneven.

Although China is lowering tariffs on a range of US agricultural goods, soybeans were excluded from the proposed tariff reductions.

Private Chinese processors currently have little economic incentive to increase US soybean purchases because existing tariffs and weak crushing margins make competing South American supplies more attractive.

Our View

Businesses should avoid interpreting the summit as either a complete trade reset or simply diplomatic symbolism.

There are now real commercial measures, but their significance will vary considerably by sector.

Companies should ask:

• Is our product included in the tariff framework?
• What tariff applies today?
• When will the reduced tariff actually become effective?
• Does implementation require further legislation or regulation?
• Are competitors included?
• Could suppliers change because of the tariff reduction?
• Could customers change sourcing countries?
• Could existing trade diversion reverse?
• Are purchase contracts based upon current tariff levels?
• Who benefits if tariffs fall?
• Are tariff savings passed to customers?
• Could shipping volumes change?
• Could coal movements increase?
• Could agricultural trade patterns change?
• Are rare-earth supplies genuinely improving?
• Are critical-mineral inventories sufficient?
• Are Chinese customers actually buying, rather than merely gaining the ability to buy?

The soybean market provides an important example.

A government can reduce trade barriers without creating commercial demand.

Equally, a tariff agreement does not help a company until the relevant measure has actually been implemented.

Businesses should therefore monitor three separate stages:

Political agreement → regulatory implementation → commercial behaviour.

Only when all three align does a diplomatic agreement become a meaningful change to the supply chain.

A trade agreement can open the door — but price, demand and supply still determine whether businesses actually walk through it.

Risk Indicator: ELEVATED – US/CHINA, TRADE POLICY & CORPORATE SUPPLY CHAINS

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Disclaimer

The information contained within these Market Alerts is provided for general market awareness and informational purposes only. It does not constitute financial, legal, investment, regulatory or insurance advice. Whilst every effort has been made to ensure accuracy at the time of publication using multiple reputable and independently verified sources, geopolitical events, legislation, regulation and market conditions may change rapidly. Readers should obtain appropriate professional advice before acting upon any information contained herein.

Invictus Risk Solutions LLP – Helping organisations stay ahead of emerging risks through informed insight and independent analysis.