Trump’s Tariffs on Food Trade: How Farmers, Traders & Consumers Will Be Affected

Trump’s Tariffs on Mexico & Canada: Food Trade, Prices & Market Shifts Explained

President Donald Trump's recent implementation of a series of tariffs on key agricultural trading partners, namely Canada, Mexico, China, and the European Union—has initiated significant shifts in both domestic and global food markets. These measures, announced on February 2024 and March 2025, are poised to influence local markets, international food trade, product availability, and consumer prices.

Overview of the Tariff Changes and Main Products Affected

Mexico and Canada have been in the eye of the cyclone. Both countries are heavily reliant on the U.S. market, with over 75% of Canadian exports and more than 83% of Mexican exports directed to the United States. The imposition of 25% tariffs on all goods from these nations, excluding Canadian oil and energy exports (subject to a 10% tariff), threatens to reduce their export revenues and could lead to economic downturns. Although initial agreements delayed these tariffs until March 4, 2025, the potential for their enforcement has created uncertainty in the market. Let’s look at the main products affected by tariffs and food trade between Mexico, Canada, and the USA.

Mexican Exports Affected:

Avocados: Based on a report from the Avocado Institute of Mexico, the U.S. imported 2.8 billion pounds of Hass avocados from Mexico in 2023. This accounted for 89.1% of total U.S. avocado imports that year. The import value of Mexican avocados in 2023 was $2.7 billion, with an average price of $1.10 per pound. Tariffs on avocados are likely to raise prices for U.S. consumers and may prompt Mexican exporters to explore other international markets. One of these aspiring suitors is the EU, creating a highly competitive environment, especially for Kenyan exporters that have been covering large parts of the Union’s current needs for the months of May to September, the Avocado Society of Kenya (ASOK), mentions.
Tomatoes: With imports totaling $2.38 billion in 2021, Mexican tomatoes constitute a significant portion of the U.S. market. Tariff-induced price hikes could lead to increased costs for consumers and restaurants, and Mexican producers might seek new markets to offset potential declines in U.S. demand, the Texas International Produce Association mentions.
Berries: The U.S. imported $2.17 billion worth of berries (excluding strawberries) from Mexico in 2021, reflecting a 17% increase from 2020. Tariffs on these products could result in higher prices for consumers and encourage Mexican exporters to diversify their markets.
Bell Peppers: Imports from Mexico reached $1.51 billion in 2021, up 16% from the previous year. Tariffs may lead to increased prices in the U.S., affecting both consumers and food service providers, the Business Insider mentions.
Beer: Mexico is the world's leading exporter of beer, with exports totaling $5.95 billion in 2022. Brands such as Corona and Modelo, produced by companies like Constellation Brands, are popular in the U.S. market. Tariffs on beer imports could lead to higher prices for U.S. consumers and prompt Mexican breweries to consider alternative markets.

On the other hand, Canada and Mexico are the top buyers of U.S. exports in more than 72% of all export categories, according to analysis of the latest U.S. Census Bureau data, Forbes highlights. More specifically, countermeasures coming from Mexico after the application of the tariffs can significantly harm the US market of corn and pork since Mexico is the biggest importer of these two products.

Canadian Exports Affected:

Maple Syrup: Vermont businesses have expressed concerns over tariffs affecting Canadian maple syrup imports, which could lead to higher prices for consumers and compel Canadian producers to explore other markets, APnews mentions.
Barley and Malt: Tariffs on barley and malt imports from Canada are anticipated to add approximately $60 million to the cost structure of small U.S. brewers. This increase may result in higher beer prices for consumers and prompt Canadian exporters to seek alternative markets, as mentioned in Food & Wine. At the same time, the 25% tariff on aluminum imports from Canada further affects the industry (since it is one of the main packaging options used).

The tariffs on these key commodities are expected to lead to higher prices for U.S. consumers and may disrupt supply chains. Producers in Mexico and Canada may seek alternative markets to offset potential declines in U.S. demand, leading to shifts in global trade patterns. Businesses are also exploring adjustments to their supply chains and considering absorbing some of the increased costs to maintain competitiveness, the Wall Street Journal mentions.

China: A 10% tariff on Chinese goods (above any existing tariffs) took effect on February 4, 2025, affecting a broad spectrum of products, including agricultural commodities

Potential Extension of Tariffs

European Union: The administration has threatened a 200% tariff on European alcohol imports, particularly wines and spirits, escalating trade tensions and disrupting the beverage industry. The looming tariffs on European alcohol have already caused U.S. importers to halt shipments, leading to potential oversupply in Europe and shortages in the U.S. market. This disruption could harm European exporters and limit choices for U.S. consumers. According to the OENsights report, Italy (24.5%), France (20.7%), and Greece (19.4%) are the three EU countries with the highest dependency on wine exports to the USA. More specifically, large wineries like the CAVINO Winery & Distillery S.A (Greece), Cantine Riunite & CIV (Italy), and prestigious French brands like LVMH (Moët Hennessy Louis Vuitton) highly depend on exports, and their wines are prominent in the U.S. market, follow the discussions closely. Many winemakers have already expressed their concern and have started planning for all scenarios, looking for alternative markets to mitigate the results of such measures.
Venezuela: The administration is considering extending Chevron's license to operate in Venezuela, coupled with new tariffs or financial penalties on countries purchasing oil from Venezuela, the New York Post mentioned. This move seeks to pressure President Nicolás Maduro back into negotiations and prevent nations like China from accessing Venezuelan oil resources, the New York Post and Reuters say.

Impact on Global and Local Markets

The U.S. has historically been a significant exporter of agricultural products. However, recent data indicates a shift: in 2024, U.S. agricultural imports reached a record $263 billion, while exports declined to $191 billion, resulting in the largest import-export gap to date. The newly imposed tariffs are likely to exacerbate this trend by:

Reducing Export Competitiveness: Retaliatory tariffs from affected countries make U.S. agricultural products less competitive abroad, potentially leading to a decline in export volumes.
Altering Trade Relationships: Countries may seek alternative suppliers to circumvent tariff-induced price increases, thereby reshaping global trade networks and diminishing the U.S.'s role in certain markets.

What all these means for the:

Farmers

American farmers are confronting a dual challenge: reduced export opportunities due to retaliatory tariffs and increased costs for essential inputs. For instance, about 85% of the U.S. supply of potash, a critical fertilizer component, is imported from Canada. The imposed tariffs could raise fertilizer prices, thereby escalating production costs for farmers. Additionally, with countries like Mexico and China implementing counter-tariffs on U.S. agricultural products, American farmers may struggle to find alternative markets, leading to potential revenue declines. These concerns have been captured by numerous important news sites and local farmers' organizations. A recent poll conducted by AgWeb (to 3,000 farmers) indicates that more than half of U.S. farmers do not support President Trump's use of tariffs as a negotiation strategy. Additionally, many farmers are concerned about the potential negative impact of such tariffs on agricultural exports and market access.

Food Traders and Logistics Managers

The tariffs introduce volatility in supply chains, compelling food traders and logistics managers to navigate increased operational complexities. Uncertainties regarding tariff implementations and potential retaliatory measures necessitate strategic adjustments, such as seeking alternative suppliers or renegotiating contracts. These adaptations could result in higher operational costs and logistical challenges. However, as Wikifarmer’s logistic manager mentioned, “it is too early to make a hypothesis. It is important to follow the news and νοτ react prematurely to avoid wrong to avoid wrong handling”.

Consumers

Consumers are likely to experience higher prices for various food items. Given that Mexico and Canada supply nearly 70-90% of U.S. fresh vegetable imports and over half of fresh fruit imports, the 25% tariffs could substantially elevate grocery bills. Products like avocados, tomatoes, and berries, predominantly sourced from Mexico, may see noticeable price hikes. Moreover, the proposed 200% tariff on European wines could make these beverages prohibitively expensive, reducing their availability in the U.S. market, as we analyse above in detail.

Conclusion

President Trump's recent tariff policies are poised to have far-reaching effects on the agricultural sector, influencing local markets, global trade dynamics, food availability, and consumer prices. Farmers, food traders, logistics managers, and consumers alike must brace for a period of adjustment as the market responds to these changes. Stakeholders may need to explore new strategies, such as diversifying supply sources, investing in domestic production capabilities, and advocating for policy considerations that mitigate adverse impacts on the food supply chain.

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