Could these ASX small caps make a motza out of the China-US trade beef?

China is targeting more than 100 US products for tariffs in an escalating trade war with the Trump government.

Which ASX stocks could benefit?

Stockhead counted more than 20 small caps (see table below) that could be in the right place at the right time to reap an advantage from the China-US trade spat.

Monash University international trade law lecturer Dr Giovanni Di Lieto says the beef sector is one area where Australia could benefit from trade diversions.

“Australian beef producers will be much more competitive in exporting to China as their American competitors have to grapple with the 25 per cent tariff on their beef,” Dr Di Lieto wrote in The Conversation this week.

“On the other side, as China raises tariffs on soybeans, Australia could buy this product more cheaply from US farmers keen to find new distribution channels.”

Australia is reasonably safe from retaliatory action from the US, because of its negative trade balance — meaning it imports more from the US than it exports, Dr Li Lieto says.

Code	Company	Month price change	Price March 12, 2018	Price April 9, 2018	Market Cap	Chinese exports?
ABT	ABUNDANT PRODUCE	0.1111111111	0.4	0.36	20.04M	In the works
AS1	ANGEL SEAFOOD	-0.0667	0.15	0.14	18.84M	Aspirational
AVG	AUSTRALIAN VINTAGE	0.03333333333	0.62	0.6	164.62M	Yes
AWY	AUSTRALIAN WHISKY HOLDINGS	-0.2	0.04	0.05	23.98M	Aspirational
BFC	BESTON GLOBAL FOOD CO	0.1578947368	0.22	0.19	82.01M	Yes
BAH	BOJUN AGRICULTURE HOLDINGS	0	0.3	0.3	36.45M	Yes
BEE	BROO	0	0.17	0.17	103.40M	In the works
BUG	BUDERIM GROUP	0.1935483871	0.37	0.31	26.24M	In the works
CZZ	CAPILANO HONEY	0.04	16.9	16.25	153.21M	Yes
CSS	CLEAN SEAS SEAFOOD	0	0.06	0.06	96.70M	No
DW8	DAWINE	0	0.01	0.01	5.26M	Yes
FOD	FOOD REVOLUTION GROUP	0	0.04	0.04	17.36M	Aspirational
GRB	GAGE ROADS BREWING CO	0	0.08	0.08	66.52M	No
HUO	HUON AQUACULTURE GROUP	-0.035	4.57	4.41	385.16M	Yes
MTM	MARETERRAM	0.03703703704	0.28	0.27	41.72M	Yes
MCA	MURRAY COD AUSTRALIA	0	0.06	0.06	20.81M	In the works
MRG	MURRAY RIVER ORGANICS GROUP	0.1764705882	0.4	0.34	47.20M	No
NAM	NAMOI COTTON	0.01960784314	0.52	0.51	67.20M	Yes
OGA	OCEAN GROWN ABALONE	0	0.17	0.17	29.60M	Aspirational
SFG	SEAFARMS GROUP	0.2	0.06	0.05	70.18M	No
TFL	TASFOODS	0	0.17	0.17	36.15M	No
WLD	WELLARD	0.1666666667	0.14	0.12	63.75M	Yes

The Chinese list of US goods it wants to tax also includes cotton, dried cranberries, wheat, and whisky.

Australian Whisky Holdings (ASX: AWY) and Murray River Group (ASX:MRG) have Chinese aspirations, while Namoi Cotton (ASX:NAM) supplies cotton mills there.

Dairy products have not yet been included in the tit-for-tat taxes and local formula exporters do not believe the trade spat will affect them much.

US dairy farmers have been losing market share for years in China anyway because of the higher tariffs on their products, according to the US Dairy Export Council (USDEC).

Where Australia companies can win, using Dr Di Leito’s logic, is picking up trade routes that could be strangled by US-China tariffs.

One example is China’s proposed 25 per cent tax on US soybeans, which it crushes to feed livestock, poultry and fish.

China is the largest buyer of soybeans in the world of which 40 per cent comes from the US, according to UN Comtrade.

Australian companies could be well-placed to supply gaps if Chinese fish, beef and pork farmers are forced to de-stock due to lack of feed. They could include Mareterram (ASX:MTM), Huon Aquaculture Group (ASX:HUO) and cattle exporter Wellard (ASX:WLD).

“Chinese consumers are now demanding more protein,” said Beston Foods (ASX:BFC) in its annual report last year.

“Chinese seafood consumption per capita for example, has tripled over recent years and now demands around 60 per cent of global aquaculture output. China has also become the worlds’ top meat eating nation.”