US farmers could be “severely impacted” if EU implements retaliatory food tariff, warn experts
US farmers and producers could be severely impacted if the EU puts a tariff on key food imports from the US, such as nuts, soybeans, and alcoholic drinks, experts have warned. The caution comes as the EU decides whether to respond to President Donald Trump’s recent levies on EU aluminum and steel imports.
Trump recently enforced a 25% tax on EU steel and aluminum, which will begin on March 12, in response to what he calls a trade deficit in goods and EU action against US tech firms. The move was the latest in a frenzy of tariffs imposed by the US Administration on other countries and heavy cuts to the US federal government.
According to US government data, the EU is the fourth largest market for US agricultural exports. In 2024, tree nuts, including almonds and Brazil nuts, were the largest exported item to the EU, with a total value of US$2.7 billion. This was followed by soybeans (US$2.4 billion) and distilled spirits (US$1.2 billion).
The importance of the EU
Inga Fechner, senior economist at ING, tells Food Ingredients First that although agri imports only make up a small fraction of the overall trade between both economies, the EU is still an important market for the country.
“US farmers and food producers could be severely impacted by additional tariffs, as the loss in competitiveness and reduced demand for their products might lead to significant revenue losses. According to European Commission (EC) data, approximately 45,000 jobs in the US could be affected. Likewise, European consumers might experience higher prices for certain food products and less choice,” she says.
The ING team has mapped out how the EU could counter US tariffs, with a view that Europe is in a good position to defend itself.
Last week, EC President Ursula von der Leyen warned that tariffs on the EU “will not go unanswered” and would trigger “firm and proportionate countermeasures.” If implemented, the move could have far-reaching consequences for the US. The Financial Times reported over the weekend that the EC would explore import restrictions on certain foods made to different standards to protect producers and farmers.
A spokesperson for the EC struck a more circumspect tone this week, telling Food Ingredients First that the EC will not comment on speculation of reciprocal tariffs against the US.
Trump, meanwhile, has reportedly shrugged off the prospect of levies, telling reporters at an event at Daytona Beach in the US: “...Let them [the EU] do it. Let them do it. It’s just hurting themselves if they do that.”
Strategic import change
There have been suggestions by economists that the US Administration is using taxes as a tool to negotiate better deals for the US, but there are no signs at this stage that Trump intends to scrap any of his plans.
Cyrille Filott, global strategist for consumer foods, packaging & logistics at RaboResearch Food & Agribusiness, tells Food Ingredients First that the scale of the impact will depend on what food is covered by any potential EU levies.
“The case of soybeans is interesting because of the impact on animal feed prices and, therefore, meat prices in supermarkets. It may not be substantial necessarily, but it will be visible [to consumers and businesses]. But we just don’t know if there will be an exemption for soybeans,” he says.
Filott adds that there is also the potential for a strategic shift related to imports. The EU could choose to buy more from Brazil as products like soybeans and tree nuts are so important to its trade.
“We’re all waiting to see what the definition of food will be,” he concludes.
