NASHVILLE, TENN. (RFD-TV) — We begin this morning with new details on President Donald Trump’s trade policy. Both Canada and Mexico are now in the crosshairs again this week.
In a social media post, President Trump calls on Mexico to release water he says is required under the 1944 Water Treaty, saying Mexico’s failure is harming farmers and ranchers in Texas. If Mexico does not comply by the end of the year, Trump says it will be subject to a 5 percent tariff.
On the Canadian side, Trump says steep tariffs could hit fertilizer supplies coming from our northern neighbor. More than half of Canada‘s potash supply goes to the U.S. Trump says he wants more fertilizer production here in the United States, but no timeline was given for that proposal.
U.S. food costs could ease as new tariff exceptions and trade agreements expand access to key imported goods.
According to Dr. Luis Ribera, Professor and Director of the Center for North American Studies, the Trump administration’s recent actions target high-dependency products such as bananas, tea, coffee, cocoa, fruit juice, spices, tomatoes, and select fertilizers — many of which rely heavily on foreign supply.
Imports account for over 90 percent of U.S. consumption of bananas, tea, coffee, and cocoa, and more than 60 percent of imports of spices, tomatoes, and fruit juice. Canada leads in imports of fertilizers and cocoa products; Brazil dominates fruit juice and coffee; and Mexico supplies 85 percent of tomatoes.
The Trump Administration also announced new framework agreements with Ecuador, Guatemala, El Salvador, and Argentina, removing reciprocal tariffs on most exports to the United States. Together, those nations shipped $7.45 billion in agricultural goods to U.S. buyers last year.
Farm-Level Takeaway: Tariff relief and new trade agreements may temper food costs by reducing import costs.
Tony St. James, RFD-TV Markets Specialist
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