Mr. Trump uses the old "trick" with Mexico and Canada

President-elect Donald Trump threatened to impose tariffs on goods from Mexico and Canada, but the United States itself "suffered".

Mr. Trump plans to impose tariffs on goods from Mexico and Canada. (Source: Kimt)

Prices for avocados, strawberries and other fresh produce in the US could rise next year and consumers could face supply shortages, economists and agricultural executives predict.

That will happen when Mr. Trump carries out his plan to impose tariffs on goods from Mexico and Canada.

Impact spreads across all fields

Canada and Mexico are the top two suppliers of agricultural products to the world's largest economy, with agricultural imports totaling nearly $86 billion last year, according to data from the US Department of Agriculture (USDA).

As a result, economists say, imposing tariffs on food products from these two countries could have financial and operational spillover effects on US supplies.

This also shows Washington's dependence on agricultural products from these two neighboring countries.

On November 25, Mr. Trump announced that he would sign an executive order on his first day as US president (January 20, 2025).

Specifically, he will impose a 25% tax on all products imported into the US from Canada and Mexico to limit the flow of illegal drugs and illegal immigrants into the US.

Lance Jungmeyer, president of the American Fresh Produce Association, said consumers would feel the impact of the tax as grocery stores and restaurants ran out of products.

“We will see fewer items at the produce counter,” he said. “Restaurants will have to reorganize their menus in ways that use fewer fruits and vegetables or reduce portion sizes.”

Meanwhile, the USDA revealed that about two-thirds of all US vegetable imports and 50% of fruits and nuts come from Mexico, with 90% of avocados, 35% of orange juice and 20% of strawberries.

Avocado exports to the world's largest economy have jumped 48% since 2019, as consumers increasingly put avocados in salads and sandwiches, US trade data shows.

"The US market accounts for about 80% of Mexico's total avocado exports, worth $3 billion last year," the USDA announced.

“The tariffs will create an inflationary spiral,” said Alfredo Ramirez, governor of the state of Michoacan, Mexico’s main avocado producer. “Demand will not decrease, but costs and prices will increase. This will push up inflation and have direct consequences for consumers.”

Sam Kieffer, vice president of public policy for the American Farm Bureau Federation, said the tariffs could also push up the price of fertilizer imported from Canada at a time when farmers are paying nearly 50% more for fertilizer than in 2020.

“Now is not the time to create shock waves in the agricultural economy,” he said.

In addition, Trump's plan could also slow the export of more than 1 million Mexican cattle to the US across the border each year, to serve Washington's beef supply.

In recent years, American producers have cut back on their cattle numbers, driving up beef prices.

These people could benefit if the tariffs lead to fewer cattle and beef imports, said Bill Bullard, executive director of the nonprofit Ranchers Cattlemen Action Legal Fund United Stockgrowers of America (R-CALF USA).

“We look forward to the imposition of tariffs as it will help level the playing field for domestic producers,” he said.

The tariffs could also disrupt shipments of beef, dairy cattle and pork between the US and Canada and could impact producers in both countries.

“Donald Trump is willing to tweet out threats of tariffs, often in the evening, after watching Fox News. But in the end, those tweets usually go nowhere!” - expert Lincicome.

America also "got shot"

According to the latest USDA forecasts, the US could have an agricultural trade deficit of more than $42 billion by 2025, partly due to consumer interest in off-season produce and imported wine from Mexico.

Peter Tabor, a lawyer and senior policy adviser at Holland & Knight and a former USDA trade official, said Trump's threat to impose tariffs could be a way to gain leverage with Mexico and Canada in renegotiating the U.S.-Mexico-Canada (USMCA) trade agreement, which is scheduled to be reviewed in 2026.

However, Mr. Tabor affirmed that the world's largest economy imposing increasing tariffs over time could be seen as an unreliable trading partner and US importers of goods would look for alternative sources of imports from other countries.

Not only will US consumers feel the impact of the tariffs, but US businesses operating across borders will also be affected.

“I don’t think people fully understand how integrated the North American supply chain is,” said Scott Lincicome, a trade expert at the CATO Institute.

For example, in the US auto industry, some components such as car seats may be manufactured overseas before finally being assembled into a US-made car.

“That kind of seamless trade would be completely threatened by a 25% tariff, thus harming many American manufacturers and workers,” he added.

The same old "trick" that doesn't work?

Under US law, the president has broad authority to impose taxes. Tariffs are a tactic the 47th president has used in the past.

Mr. Trump has imposed tariffs on many imports during his first term, often after lengthy reviews by the Commerce Department or the U.S. Trade Representative.

However, the new White House chief has made more threats about tariffs than he has actually followed through.

“Donald Trump is willing to tweet out threats of tariffs, often in the evening, after watching Fox News,” Lincicome said. “But those tweets usually go nowhere!”

Source: https://baoquocte.vn/ong-trump-dung-chieu-cu-voi-mexico-va-canada-mot-loi-de-threat-khong-di-den-dau-my-cung-dinh-don-295463.html