The US has announced the third round of import tariffs on goods from China. The latest batch imposes a 10 per cent import duty on goods from China. The first two rounds earlier this year imposed 25 per cent tariffs on goods imported from China. China retaliated each time with its own punitive import duties on US products, such as cotton, soybeans, wine, fruit and beef. The latest round of US duties means that around 44 per cent of China’s exports to the US now have excess duties imposed.

A full-scale trade war is breaking out. Until now the products included in the first two rounds of import duties by the US did not include wool products. However, this week’s list includes a range of wool and wool-related products.

The list does not include any finished wool or wool blend clothing, such as suits, jumpers, trousers, coats, overcoats and so on. From Australia’s perspective, these are critical. These products make up the vast majority of US imports of apparel-related wool products from China.

China accounts for 53 per cent of all US imports of wool clothing. An extra duty would hurt the trade by pushing the price paid by US consumers higher.