The US agricultural industry is bracing itself to feel the full force of any potential trade war between America and the European Union as well as other nations who may retaliate against President Trump’s tariffs on steel and aluminum.
The farming sector could be in the firing line as Trump’s trade war escalates, mainly as now is the beginning of the wheat harvest season in parts of the US and the trade war is casting some doubt over where the estimated 60 million tons of wheat will be sold.
With the EU, Canada, Mexico and China all threatening retaliation, some are concerned that agriculture will feel the impact over the metal tariffs.
Tensions are increasing, the situation is very changeable and the tariff-free flow of products characterized by the modern global economy as we know it seems to be hanging in the balance.
Instead, President Trump is leading the charge of a new unfriendly approach to trade with countries that have traditionally been seen as allies.
At the end of last week, FoodIngredientsfirst reported how the 10 percent and 25 percent tariffs on aluminum and steel imports respectively came into effect and just minutes after the imposition was confirmed, the EU pledged to implement retaliatory tariffs and seek a settlement dispute at the World Trade Organization (WTO).
The EU made public its full 10-page list of US products that could be targeted for retaliation unless the Trump administration backs down and exempts the allied member states from the new tariffs on steel and aluminum imports.
Included on the list are various sweetcorn categories, including frozen, kidney beans, maize (except seeds for sowing), some categories of semi-milled rice, peanut butter, cranberries and orange juice as well as bourbon whiskey in certain measurements and containers.
And Canada is planning “trade-restrictive countermeasures” which could affect US$12.8 billion of US goods. Canada could begin its own 10 percent tariffs on a wide variety of items which include yogurts, soy sauce, strawberry jam, pizza, quiche, orange juice, whiskey, soup, coffee, water and mixed condiments.
The situation is being closely monitored as June looks to be a crucial month with President Trump expected to publish a US$50 billion list of Chinese technology products to be impacted by a 25 percent tariff, prompting further retaliation by China.
Where they will hit remains to be seen, but the fear factor is growing among US farmers who expect to be hit hard.
Source: Food Ingredients First
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