AUSTIN (Nexstar) — Before the ink dried on the new trade agreement between the United States and China, Texas farmers and manufacturers applauded the step forward in international diplomacy that could help their bottom lines.

The deal pauses a two-year trade war between the two countries, which drove up tariffs and lowered selling prices for many American goods.

“We have been waiting on maybe the beginning of a resolution,” Dawson County cotton and peanut farmer Shawn Holladay, said.

Holladay, chairman of American Cotton Producers and a board member of Plains Cotton Growers, said the extra costs that came with trade tensions caused financial problems for him and other area farmers.

“It put us ‘under the water’ so to speak on our crop two years ago,” he said. “Moving into the next year it kept us at very depressed levels and it greatly affected our profitability.”

Texas Farm Bureau president Russell Boening said China’s top five global imports are soybeans, dairy products, fruit, beef and prepared foods — Texas is a leading exporter in those commodities.

“Texas farmers and ranchers are encouraged by today’s signing of a Phase One trade agreement between the United States and China,” Boening said. “The agreement with China includes substantial purchases of U.S. agricultural products annually over the next few years. This is significant. The record for U.S. agricultural exports to China was $26 billion in 2012.”

During a visit to West Texas on Wednesday, Reece Langley, Vice President of Washington Operations for the National Cotton Council, said the deal “holds a lot of promise.”

“We know that the Chinese textile industry needs cotton,” he explained. “They want to buy high quality contamination free cotton from the U.S. and we certainly have ample supply to provide.”

“We need to try to get some stability back in our trading relationship with China,” he said. “They are the largest consumer of cotton in the world because of their textile industry, and we’re one of the larger producers of cotton in the world, so we need to be able to have fair, open access to that market, to be able to export our products.”

The trade deal, phase one of eight, leaves in place U.S. tariffs on roughly $370 billion in Chinese imports to America. But, under the new agreement, China will buy upwards of $200 billion in American exports over the next two years. That could bode well for Texas, being the number one exporting state in the nation.

“Including up to $50 billion just on agriculture alone,” President Donald Trump said Wednesday. Those agricultural commodities include cotton, meat, oilseed, cereals and other grains. Manufactured goods include electronics, vehicles and pharmaceuticals.

“They’re going to be putting into our country $75 billion on manufacturing,” Trump said of China’s part of the deal. “$50 billion worth of energy. So that’s great for our energy people. We’re the number one in the world now; we weren’t. We’re now the number-one energy group in the world. We’re bigger than Saudi Arabia, and we’re bigger than Russia. We’re bigger than everybody.”

Texas Association of Manufacturers President Tony Bennet said the Lone Star State should expect to see a boost in employment and tax revenue now that a deal has been announced.

“It’s beneficial to our oil fields and the activities there and all the related industries for manufacturing and for oil and gas production, for petrochemical, aerospace, electronics, you name it, everybody will benefit from this,” Bennett said.

The energy exports in the deal include liquefied natural gas, crude oil, refined products and coal.

“Had this not gone through, you would have seen all of our industry sectors affected logistically and monetarily in one way or another to drive up their costs and make things much more difficult,” Bennett stated. “Then you’d see job lay offs and exporting jobs in Texas, exporting jobs out of Texas because of this.”

Before signing the deal with China’s Vice Premier Liu He, President Trump said he expected an announcement relating to trade negotiations with America’s top two trading partners, Canada and Mexico as early as next week. China is third on the list of the nation’s top trading partners.

“Bringing China back as a sizable market for U.S. agriculture is critical to the economic sustainability of America’s farmers and ranchers,” Boening said, adding that he was appreciative of the step forward in trade relations with China.

Holladay said he was cautious optimistic.

“We export nearly all of our cotton to China or have in the past and so until we see some real world orders I don’t think it is going to have a great deal of impact,” he explained. “But it is moving in the right direction and we have moved our price up a little over the past week in anticipating this.”

“I think as we move forward, if it actually works the way it is designed, we may see it get better,” Holladay said.

Photojournalist Pedro Figueroa contributed to this report.