All we’ve been hearing about in the news since President Trump came into office are about his tariffs that he is implementing on Canada, Mexico, and China. These tariffs have been highly controversial, considering Canada and Mexico are America’s top trading partners. China, as well, supplies a staggering amount of goods to the United States. Some people have praised the president’s actions and say these countries will all concede rapidly to what some are calling Trump’s ‘bully tactics’, making prices better for Americans and improving the American economy. Most experts, however, are warning that this is not, in fact, what will happen at all. Many are warning that Americans should head to the grocery stores now and stock up on many things, as prices are only going to continue to rise. These are the products that will be most affected on American grocery store shelves.
Editor’s Note: At the time of publish Terrifs were set to hit. Another 30-day pause on some terifs has been enacted.
Trump Tariffs Impact on Groceries in America
As of Tuesday, the tariffs that President Donald Trump has been threatening to implement on Canada, Mexico, and China finally went into effect. He has tariffed imports from Canada and Mexico 25% and 20% from China. As many of us know, these are our biggest trading partners, with the US, Canada, and Mexico having been part of the North American Free Trade Agreement (NAFTA) since the 1990s. On top of that, the number of non-food goods that America imports from China is no short of astonishing. As these countries respond with their own sanctions against American products, what does this mean for the American consumer? In short, most experts are predicting price increases potentially coupled with product shortages. These are the products that you should consider stocking up on and why their prices are expected to rise.
Cereal Grains (& By-Products)
The United States imports a surprising $1.31 billion worth of cereal grains from Canada. Cereal grains refers to wheat, oats, barely, and rye. As a result of the tariffs, the cost of these products is expected to rise. What does that mean in the grocery store? The cost of your favorite cereals, oatmeals, breads, and other grain-based products will go up. It’s not just cereal prices that will rise, but anything made using cereal grains. For example, if you are an oat milk drinker, you can expect the cost of that product to rise. “Buying American” won’t necessarily help here, either, because there are many American cereal-based products that are made using Canadian cereal grains.
Beer & Liquor
Products like Mexico’s Modelo beer and Canadian Whisky, which are popular choices in the U.S., may also see price hikes due to tariffs. Model, in fact, is currently the number one, most drank beer in the United States. Unfortunately, however, you won’t be able to avoid the price hikes by simply avoiding Canadian Whisky and Mexican beer. Beer and whisky-making staples such as wheat and barley come from Canada, as was already mentioned with the taxation of cereal grains. Since the 1990s the United States and its neighbors to the north and south have benefited from the NAFTA agreement which allowed for easy flow of these products. If you are a beer or whisky drinker, you better go stock up on your favorite brews before the prices go up.
Avocados
Get ready to start paying a lot extra for guac. Mexico is the major supplier of avocados to the U.S., with 90% of avocados in the country coming from Mexico. This will be seen, of course, in both the grocery store and in restaurants. Of course, avocados are not necessarily something you can buy in mass quantities without them going bad. Consider buying avocados, slicing, and freezing them. It is not the same as fresh but it can still make a pretty good guacamole.
Maple Syrup
Canada produces about 75% of the world’s supply of maple syrup and has the only official maple syrup reserve in the world. Canadian maple syrup is a beloved pantry staple for many Americans. Given Canada’s status as a major supplier, you are likely to see this already expensive product increase in price even further. Thankfully, maple syrup has an impressive shelf life. If you can afford to, consider stocking up now. Otherwise, you will be stuck with the imitation stuff for the foreseeable future.
Meat
Canada is a significant exporter of meat products to the United States. This includes livestock, poultry, meats, and more. If meat is a staple part of all of your meals, you better clear out some freezer space and load up. As prices on imported meat go up, so will the demand for domestically produced versions. This not only could mean higher prices, but also shortages. If you were considering trying out vegetarianism for Lent, this year would be the best time to do it.
Fresh (& Frozen) Produce
Wait – maybe becoming vegetarian won’t be as viable an option as we thought. Last year, the United States imported $46 billion worth of agricultural products from Mexico. Mexico is a key supplier of fresh produce to the U.S., with a considerable portion of fruits and vegetables such as tomatoes, spinach, avocados, bell peppers, and berries coming from Mexican sources. These tariffs will increase the price of fresh and frozen produce in the stores. Even the CEO of Target Brian Cornell has said that while they will be doing their best to protect consumer pricing, their hands are somewhat tied. The margins on grocery store produce are incredibly thin, leaving very little wiggle room for changes in the market. On top of this, Cornell explained that during the winter months, Target has no choice but to import most of its produce from Mexico, where growing conditions are more favorable.
Sugar
The US loves sugar, so much so that the country hasn’t been able to rely on their own capacity to grow it to supply the entire nation. Both Mexico and Canada play vital roles in supplying sugar to the U.S. With tariffs looming, it is recommended that consumers consider purchasing sugar in bulk to avoid disruptions in baking and cooking activities that rely on this essential ingredient.
Non-Food Affected Products
The fun doesn’t stop there – grocery store items are not the only ones that will see price increases thanks to Trump tariffs and subsequent trade war. Many other household products – right down to the homes themselves – will see increases. This is what to expect.
Electronics & Appliances
Your shockingly expensive smart phone and laptop? They’re about to get even more costly. Consumer electronics, including cellphones, TVs, laptops, video game consoles, monitors, and components sourced from China, are among the top goods imported by the U.S. China is also a key supplier of home appliances, toys, and footwear – products that are particularly vulnerable to the tariff threats imposed by Trump.
Shoes, Clothing, Sports Equipment, and Toys
It has been a long time since Americans actually bought american-made clothing. Even the clothing made from American brands sources much of their materials and labor in other countries. The Footwear Distributors & Retailers of America indicated that 99% of shoes sold in the United States are imported, with over half of them (56%) being manufactured in China. In addition to footwear, the U.S. relies on China for toys, sporting equipment like footballs, soccer balls, and baseballs, with 75% of imported toys and sports equipment originating from China. If you thought Christmas shopping was expensive in recent years, get ready because it will likely get a whole lot worse.
Cars & Car Parts
The automotive industry is significantly impacted by the tariffs, as cars sold in the U.S. are no longer solely American-made. As already mentioned, Mexico, the US, and Canada were part of the NAFTA agreement, making a free trade zone for easy flow of products and product parts across these borders for the last several decades. Even ‘American made’ cars see their parts travel across both the southern and northern borders several times before the car is actually assembled and ready to be sold.
The rise in production costs for cars throughout North America due to tariffs is projected to be between $3,500 and $12,000, according to the Anderson Economic Group. This increased cost leads to repercussions such as potential cutbacks in production, likely affecting jobs across the industry. The shift in production back to the U.S. in response to tariffs is deemed a costly and time-consuming process that may take years to materialize.
Houses
About one third of soft lumber used in the United States is imported from Canada. American homes are built using this lumber. The tariffs placed on lumber from Canada will negatively impact the cost of building homes in America. They will become more expensive to build and likely, more scarce. This could lead to housing shortages and further exacerbate the housing crisis in the United States.
Gasoline
Time to trade out that Ford F150 for a smaller, more fuel efficient car, I guess. While oil, gas, and electricity imported from Canada will see a smaller tariff – just 10% – this will still impact pricing. This is because the US doesn’t actually produce the heavier crude oil that it needs for gas, jet fuel, and more – they import it from Canada. Some areas will see this impact sooner and heavier than others, but the whole country will feel it within a month. Experts say that depending on where you are in the country, you could see anywhere from a 5 to a 40 cent per gallon increase. That could look as high as a $6 increase per fill-up. This may not sound so scary, but add that up over the course of a year and you’d be surprised by its impact.
The Bottom Line
As Americans face the prospect of higher prices on imported goods due to tariffs, it is crucial to understand the broad range of both food and non-food items alike that are likely to be affected. Planning for potential cost increases on items can help ease the initial blow. Hopefully, this tariffs and the trade war that they have cause won’t hang around for long.
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