DeLisi: China’s Trade Commitments Signal New Era for Crop Protection Markets
In the latest episode of AgriBusiness Global Report — the sister brand to CropLife — Fanwood Chemical Inc. President Jim DeLisi outlined the key outcomes of President Trump’s recent visit to Southeast Asia and China, and what they could mean for U.S. ag retailers navigating volatile supply chains and shifting tariff landscapes.
According to DeLisi, several agreements from the trip could reshape trade dynamics and product sourcing for crop protection retailers in 2025 and beyond. “President Trump was in Asia last week — Japan, Malaysia, and South Korea. In South Korea, he met with Chairman Xi of China, and they reached a few agreements,” DeLisi said.
Rare Earths and Soybeans: Stabilizing the Supply Chain
One major development was China’s agreement to postpone any significant policy changes on rare earth elements and related materials for a year. “That was really important,” DeLisi explained. “It put the whole world in jeopardy of not having those magnets and products. So that was an important accomplishment during the meeting.”
China also committed to purchasing large volumes of U.S. soybeans through 2028 — a move that could stabilize markets and ease pricing pressure for U.S. growers and their retail partners. “It was expected that China would eventually need to buy U.S. soybeans because there literally aren’t enough soybeans in the world for them to function without some material from the United States,” he said. “But it’s great to have that confirmation.”
Tariff Shifts Create Uneven Playing Field
For retailers and distributors, one of the most consequential changes involves tariff adjustments that could alter competitive sourcing decisions. In exchange for cooperation on controlling fentanyl exports, the U.S. reduced its tariff on Chinese fentanyl from 20% to 10%. That seemingly minor change has broader implications.
“This reduction in the Chinese tariff does put India in an interesting position,” DeLisi said. “Now there are a whole series of products where the net tariff on China is lower than India. On formulated aromatic chemicals, the China tariff will now be 51.5% while it’s 56.5% from India. On non-aromatics, it’s 50% for China and 55% for India.”
DeLisi encouraged retailers and their supply partners to reexamine their sourcing strategies. “Listeners are urged to reevaluate where they stand on the total tariff impact,” he said. “These small changes can shift the competitiveness of key active ingredients and formulations overnight.”
New Trade Agreements – and New Uncertainty
In addition to the China developments, reciprocal trade agreements were signed with Malaysia and Cambodia, while framework agreements were reached with Thailand and Vietnam. DeLisi said these moves could create opportunities for new regional sourcing, but implementation may lag.
“It will now be up to the Secretary of Commerce to determine how to handle annexes two and three,” he explained. “But with the government still shut down, there aren’t many people available in the International Trade Administration to implement these agreements.”
Another piece of good news for ag suppliers: the “COVID exception list,” which grants temporary tariff exemptions, has been extended through November 10, 2026. “One agrochemical product on that list that impacts the industry is NBT, used as a fertilizer enhancement,” DeLisi said. “For all intents and purposes, all the NBT used in the United States is Chinese. It’s been exempted from tariffs of 12% to 25% and will remain exempt for another year.”
What Retailers Should Watch Next
The next major policy test will come from the U.S. Supreme Court, which will hear oral arguments this week on the IIP tariff case — a decision that could shape how presidents impose tariffs in the future.
“This is a huge week, and everybody needs to watch the news on Wednesday night,” DeLisi said. “The IIP tariff case before the Supreme Court will have oral arguments, and hopefully we’ll get some idea of how the Court is leaning.”
While the case does not directly affect Section 301 or Section 232 tariffs — which cover metals and many Chinese ag chemical imports — it could redefine the limits of presidential trade authority. “If it looks like the Supreme Court is going to go against the administration,” DeLisi added, “Mr. Trump could still use his 301 authority to do what he wants to do.”
For U.S. ag retailers, the takeaway is clear: global policy moves are again reshaping cost structures, supply options, and competitive positioning. As DeLisi summarized, “Trade policy remains one of the most powerful forces shaping crop protection and agricultural supply chains today.”
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