By Stephen DeAngelis
The Trump Administration continues to focus on tariffs as a tool in advancing its trade goals. As a result, a global trade has erupted. In some ways, Trump’s tariffs are not a surprise. During his campaign, he repeatedly indicated how much he loved tariffs. In other ways, those tariffs are surprising. One of the reasons Trump was elected was his promise to reduce inflation — especially food inflation. The price of groceries soared nearly 20 per cent under his predecessor and voters reacted. Experts warn, however, that tariffs are more than likely going to raise the price of groceries for most Americans. The Wall Street Journal staff explains, “Consumers are in the firing line for the double-digit tariffs on China, Mexico and Canada. Prices won’t necessarily go up exactly in line with the tariffs. Companies can absorb some of the increase by lowering their profit margins or finding cheaper substitutes. But there will be upward pressure on prices.”[1] Groceries will be among those items feeling upward pressure.
What Will Happen in the Grocery Aisle?
Unlike some consumer items, fresh produce will likely feel an immediate impact. Jonathan Doh, the Rammrath Chair in International Business at Villanova University, explains, “The impacts could be quite immediate and quite profound. If you think about raspberries, or spinach, or basil, [or any fresh food item] coming from outside the country and grown hydroponically, … those will be hit.”[2] Almost two-thirds of imported vegetables come from Mexico. Correspondent Caroline Goggin reports, “Roughly 90% of avocados eaten in the U.S. last year originated in Mexico, USDA data showed. Other products with a high concentration of Mexican imports include tomatoes, cucumbers, bell peppers, jalapeños, limes and mangos. Economists estimate the tariffs could lead to a rise in prices for a number of goods, indicating grocery bills could get even higher in the coming weeks.”[3]
How much higher will prices on affected foodstuffs rise? Timothy Richards, the Morrison chair of agribusiness at Arizona State University, anticipates the price of produce will increase close to the full 25%.[4] In addition to the products listed earlier, the prices of the following products are also expected to increase: strawberries; squash; bananas; pineapple; snacks made in Mexico, China or Canada; cooking oil; nuts; tea; and imported beer. For beer lovers, that’s bad news. Journalist Reia Li explains, “Modelo Especial overtook Bud Light as the United States’ best-selling beer in 2023. Modelo beers are exclusively brewed in Mexico, according to the website of Constellation Brands, the company that imports and markets the beer in the U.S. Constellation Brands also imports Corona beers.”[5] Jason Miller, a professor of supply chain management at Michigan State University, insists, “Because of the combination of these three countries, it’s going to be difficult to go down an aisle of a grocery store and not see some sort of inflationary effect.”[6]
Eventually, processed foods will also feel the impact of tariffs as the price of ingredients soars. Journalist Janet Nguyen reports, “These tariffs are far more sweeping than the taxes [Trump] put in place during his first term and will hit $1.4 trillion worth of imports, according to the Tax Foundation. Trump’s tariffs during his first term only affected $380 billion worth of goods and primarily targeted China.”[7]
Concluding Thoughts
For price-weary consumers, tariffs are bad news. Nguyen explains, “The Budget Lab at Yale, a nonpartisan policy research center, looked at the consequences of 20% tariffs on China and the 25% tariffs on Canada and Mexico. In total, households could lose an average of about $1,600 to $2,000 in real disposable income over the next year. The price of fresh vegetables and fruits could end up rising 2.9% over the next year, according to the analysis.” William Rieber, an economics professor at Butler University, told Nguyen, “Tariffs are not job creators.” This is especially true in the area of agriculture because, as Andrew Greenland, an assistant professor of international economics at North Carolina State University, explains, “The U.S. depends on countries with warmer climates to import fresh produce that it normally couldn’t get out of season.”[8] He adds, “The only way for us to get those things is to be willing to pay the tariff.”
Trump is not unaware of the potential hit to Americans’ pocketbooks. He wrote on Truth Social, “Will there be some pain? Yes, maybe (and maybe not!). But we will Make America Great Again, and it will all be worth the price that must be paid.” Many cash-strapped consumers are bound to ask: Worth it to whom?
Footnotes
[1] Staff, “What Will Tariffs Do to Grocery Prices?” The Wall Street Journal, 4 March 2025.
[2] Caroline Goggin, “Trump tariffs: Villanova professor weighs in on potential impact,” WPVI-TV/6abc, 3 March 2025.
[3] Ibid.
[4] Reia Li, “Trump’s tariffs on Mexico, Canada are now in effect. These foods will likely cost more,” Arizona Republic, 4 March 2025.
[5] Ibid.
[6] Danielle Kaye, “From Groceries to Cars, Tariffs Could Raise Prices for U.S. Consumers,” The New York Times, 4 March 2025.
[7] Janet Nguyen, “What do Trump’s tariffs mean for your grocery bill?” Marketplace, 3 March 2025.
[8] Ibid.
