Incoming tariffs set by the Trump administration are expected to impact the prices we witness across many different sectors, including food and groceries.
Initially set to go into effect on April 2, Trump has since delayed the start date for the tariffs set on Mexico and Canada.
In the early days of Trump’s second term, he boasted about placing tariffs on our two neighboring countries as well as China. As of March 7, Trump has set a 20% tariff on imported goods from China.
The country responded by enacting investment curbs on 25 American firms. However, even Republicans are raising concerns about the government enacting 25% tariffs against Mexico and Canada.
Access to fresh produce is something that many Americans might take for granted. Anyone with a car can drive to the grocery store of their choosing to handpick the produce they need. However, with taxes now levied against countries that supply much of the produce on US supermarket shelves, that access may become more sparse.
Pandemic era inflation affected common goods such as gas and groceries and still impacts Americans five years after COVID first brought the world to a halt. (Is this what you mean?)
Restricted food availability
Food security is already a national issue. Shopping at high end grocery stores such as Whole Foods or Los Angeles’ Erewhon (which recently made headlines for selling a single strawberry for $17) has become a status symbol. While a small portion of the population is spending their money on overpriced produce, others are living paycheck to paycheck in order to feed their families.
In 2023, 13.5% of US households were considered food insecure. Black communities feel these effects more severely.
In the same year, Feeding America considered 1 in 4 Black Americans, or over 9 million people, food insecure. Poverty can further exacerbate this, but where you live plays a big role.
For example, Tulsa’s north side and Oklahoma City’s east side are both historically Black communities. Yet, despite their longstanding presence, many communities still struggle to access grocery stores that offer fresh produce.
The culprit is redlining, a real estate practice that outlines “high risk” areas in red on city maps. In the 1930s, lenders began using this practice to identify areas they deemed economically unsound for property loans. While this originated as a way to deny Black people from obtaining home loans, it also impacted those wanting to open their own businesses. Despite the fact that the Fair Housing Act of 1968 outlawed the practice, its ramifications persist into modern day.
For communities that have existing barriers to fresh food, tariffs may put vulnerable populations at a heightened risk. It may also put stress on America’s farmers to increase their production while also expanding their crop portfolio.
Previous Trump tariffs and the nature of trade between the US and our neighboring countries
In 2013, our Canadian neighbors were responsible for 20.6% of agricultural product imports. This covers goods like wheat, milk and meat, but also incorporates wine, tobacco and natural fibers like cotton, wool and silk. Trade between the two countries was simplified by two landmark pieces of legislation: Canada-U.S. Free Trade Agreement (CUSTA) of 1989, and the North American Free Trade Agreement (NAFTA) of 1994. Together, these acts dismantled tariffs and quota barriers aside from a few exceptions.
These numbers are stark in comparison to what Mexico contributes to the American market. In 2023, Mexico supplied over 60% of vegetable imports and 47% of fruit and nut imports.
The tariffs are currently set to go into effect on April 2 and Trump has issued a call to action for US farmers. “To the Great Farmers of the United States: Get ready to start making a lot of agricultural product to be sold INSIDE of the United States. Tariffs will go on external product on April 2nd. Have fun!” Trump wrote on Truth Social on Monday.
It’s unclear how much “fun” farmers will have as the entire debacle unfolds, considering the top three agricultural goods produced in the US are cattle, soybeans, and corn. With 1.9 million farms scattered throughout rural America, agriculture is only responsible for 1% of the country’s GDP.
Grains commonly grown domestically, like corn, sorghum, barley and rice are often made into processed foods. However, livestock consume 40% of US-grown corn. There isn’t a plethora of crop diversity produced internally. Even if American farmers could meet current market demands, there may not be enough government subsidies to go around. USDA’s Commodity Credit Corp, an internal bank that could compensate domestic farmers for increasing their production, is running low on funding.
A similar story played out in the latter years of Trump’s first administration. In 2018, retaliatory tariffs caused a $26 billion loss in the agriculture industry.
Related Stories:
- Trump reverses course as tariffs threat throws economy into chaos
- Analysis: Trump tax plans will help the rich, hurt the middle class
- Redlined Black communities face higher risk of heart failure