Impact of New US Tariffs on European Agricultural Exports
EU agriculture faces significant challenges as the US imposes 20% tariffs on a range of products, including wine, spirits, and dairy.
The European agriculture sector is preparing for substantial disruptions following the announcement by the US government to impose 20% tariffs on all European Union (EU) exports, effective April 9. This development raises concerns particularly for industries including wine, spirits, dairy, and olive oil, which have significant reliance on the US market.
In 2024, the US accounted for 13% of the EU's total food and agricultural exports, which were valued at €25.1 billion, making it the second-largest market for EU agricultural goods after the UK. While the US may easily redirect its food exports of commodities such as soybeans, fruit, and nuts to other markets, EU exports largely consist of high-value products that face challenges in finding alternative markets.
The wine and spirits sectors are particularly vulnerable, with the EU exporting €4.9 billion in wine and €2.9 billion in spirits to the US in 2024. Key products include French Bordeaux, Bourgogne, and Champagne wines, as well as cognacs from Charente, Italian wines from Piedmont and Tuscany, and Irish whiskey.
The French Federation of Wine and Spirits Exporters forecasts a decline in exports from France of approximately €800 million.
The cognac industry, severely impacted by previous tariffs imposed by China, has voiced concerns that the new taxes could lead to closures of businesses in Charente, according to industry representatives.
Ireland’s whiskey exports are also significantly reliant on the US market, which absorbs 41% of Irish drinks exports annually.
The Irish Farmers Association indicates that their dairy exports, notably Kerrygold butter, will similarly be affected, as this brand has become the second best-selling butter in the US.
In 2024, cheese exports to the US from the EU are valued at €1.3 billion, primarily from Italy, France, Spain, and the Netherlands, while butter exports amount to €560 million.
Specifically, Pecorino Romano cheese, which currently enjoys zero tariffs, faces an increase in wholesale price from €12.50 to €15 per kilo due to the tariffs.
This product's production is heavily reliant on Sardinia, where local economies could be greatly affected.
Greek feta cheese producers have expressed fears that the tariffs would jeopardize their market presence, while Spanish and Italian farmers are particularly concerned about the impact on olive oil exports, with both countries exporting around €1 billion worth of olive oil to the US in 2024. The 20% tariff will place Spanish olive oil at a disadvantage compared to other countries such as Turkey and Morocco, which face lower tariffs.
Spanish olive oil production, which is vital for the Andalusian economy, is expected to suffer significantly, following prior tariffs imposed on table olives that resulted in over €280 million in losses.
There remains uncertainty regarding any retaliatory measures the European Commission might consider in response to the US tariffs, particularly concerning American products such as bourbon whiskey.
Trade representatives are advocating for a balanced dialogue with US authorities, aiming for a suspension of the tariffs to mitigate losses for EU producers.
Overall, the potential economic impacts of these tariffs raise questions about the future landscape of transatlantic trade in the agricultural sector, with significant implications for both EU producers and US consumers dependent on European imports.
In 2024, the US accounted for 13% of the EU's total food and agricultural exports, which were valued at €25.1 billion, making it the second-largest market for EU agricultural goods after the UK. While the US may easily redirect its food exports of commodities such as soybeans, fruit, and nuts to other markets, EU exports largely consist of high-value products that face challenges in finding alternative markets.
The wine and spirits sectors are particularly vulnerable, with the EU exporting €4.9 billion in wine and €2.9 billion in spirits to the US in 2024. Key products include French Bordeaux, Bourgogne, and Champagne wines, as well as cognacs from Charente, Italian wines from Piedmont and Tuscany, and Irish whiskey.
The French Federation of Wine and Spirits Exporters forecasts a decline in exports from France of approximately €800 million.
The cognac industry, severely impacted by previous tariffs imposed by China, has voiced concerns that the new taxes could lead to closures of businesses in Charente, according to industry representatives.
Ireland’s whiskey exports are also significantly reliant on the US market, which absorbs 41% of Irish drinks exports annually.
The Irish Farmers Association indicates that their dairy exports, notably Kerrygold butter, will similarly be affected, as this brand has become the second best-selling butter in the US.
In 2024, cheese exports to the US from the EU are valued at €1.3 billion, primarily from Italy, France, Spain, and the Netherlands, while butter exports amount to €560 million.
Specifically, Pecorino Romano cheese, which currently enjoys zero tariffs, faces an increase in wholesale price from €12.50 to €15 per kilo due to the tariffs.
This product's production is heavily reliant on Sardinia, where local economies could be greatly affected.
Greek feta cheese producers have expressed fears that the tariffs would jeopardize their market presence, while Spanish and Italian farmers are particularly concerned about the impact on olive oil exports, with both countries exporting around €1 billion worth of olive oil to the US in 2024. The 20% tariff will place Spanish olive oil at a disadvantage compared to other countries such as Turkey and Morocco, which face lower tariffs.
Spanish olive oil production, which is vital for the Andalusian economy, is expected to suffer significantly, following prior tariffs imposed on table olives that resulted in over €280 million in losses.
There remains uncertainty regarding any retaliatory measures the European Commission might consider in response to the US tariffs, particularly concerning American products such as bourbon whiskey.
Trade representatives are advocating for a balanced dialogue with US authorities, aiming for a suspension of the tariffs to mitigate losses for EU producers.
Overall, the potential economic impacts of these tariffs raise questions about the future landscape of transatlantic trade in the agricultural sector, with significant implications for both EU producers and US consumers dependent on European imports.
Translation:
Translated by AI
AI Disclaimer: An advanced artificial intelligence (AI) system generated the content of this page on its own. This innovative technology conducts extensive research from a variety of reliable sources, performs rigorous fact-checking and verification, cleans up and balances biased or manipulated content, and presents a minimal factual summary that is just enough yet essential for you to function as an informed and educated citizen. Please keep in mind, however, that this system is an evolving technology, and as a result, the article may contain accidental inaccuracies or errors. We urge you to help us improve our site by reporting any inaccuracies you find using the "Contact Us" link at the bottom of this page. Your helpful feedback helps us improve our system and deliver more precise content. When you find an article of interest here, please look for the full and extensive coverage of this topic in traditional news sources, as they are written by professional journalists that we try to support, not replace. We appreciate your understanding and assistance.
