Will the price of avocados make Americans say enough to Trump’s tariffs?
President Trump last Thursday said he planned to impose a five percent tariff on all Mexican imports on June 10 to pressure the Mexican government into offering more help stemming immigration across the southern border of the U.S.
The president tweeted that the tariff would “gradually increase until the Illegal Immigration problem is remedied.” The White House later clarified the tariff would increase to 10 percent on July 1, 15 percent on Aug. 1, 20 percent on Sept. 1, and 25 percent on Oct. 1.
As the U.S.’s second largest export market and third largest trading partner, across-the-board tariffs would be significantly felt by U.S. consumers and corporations.
Imports from Mexico include agriculture, cars, machinery, fuel and medical devices. Mexico is the eight largest supplier of apparel and seventh of footwear to the U.S. market. Many U.S. industries have tightly linked supply chains with Mexico.
Nearly half of all imported U.S. vegetables and 40 percent of imported fruit comes from Mexico. Prices on tomatoes, avocados, peppers, lemons and other fresh produce are expected to soar should the tariffs be enacted. Lance Jungmeyer, president of the Fresh Produce Association of the Americas, said in a statement, “This is a tax on healthy diets, plain and simple.”
In 2017, U.S. retailers imported $128 billion in goods from Mexico, according to the National Retail Federation (NRF).
Mexico could make retaliatory moves against U.S. exports to Mexico or derail the USMCA, the Trump administration’s update to NAFTA. Tariffs are typically used to counter trade violations, not immigration disputes, so legal battles may follow.
As in past escalations of Chinese tariffs, retail organizations joined other business groups in issuing statements calling the tariffs a tax on U.S. businesses and consumers.
David French, the NRF’s SVP of government relations, said, “Forcing Americans to pay more for produce, electronics, auto parts and clothes isn’t the answer to the nation’s immigration challenges and this certainly won’t help move USMCA forward.”
Rick Helfenbein, CEO of the American Apparel & Footwear Association, said, “The bottom line is that these tariffs are disastrous for the American economy.”
- Trump Says U.S. Will Hit Mexico With 5% Tariffs on All Goods – The New York Times
- A US-Mexico border shutdown threatens more than just avocados — here are all the foods that could disappear from store shelves – Business Insider
- Retailers warn of growing tariff bill for American businesses and consumers – National Retail Federation
- Apparel and Footwear Industry Labels Proposed Tariffs on Mexico ‘Unfathomable’ – American Apparel & Footwear Association
- Tariffs on Mexican Imports Would Hit More Than Avocados in Grocery Stores – The Wall Street Journal
- Mexican tariffs would be bad news for denim – CNBC
- What Mexican Tariffs Would Mean For Retail – NPR
- ‘Dangerous and destabilizing:’ Businesses warn about the risks of Mexico tariffs – CNN
- A New Tariff on Mexican Goods Will Impose A $3 Billion Food Tax on American Consumers, According to U.S. Produce Importers and Distributors – Fresh Produce Association of the Americas
DISCUSSION QUESTIONS: Is the potential impact of tariffs on Mexican imports any greater for American businesses and consumers than those being placed on Chinese goods? How should retailers prepare and react?