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President-elect Donald Trump’s recent statements about imposing tariffs on imports from Canada, Mexico, and China have stirred concerns across industries, especially for the U.S. foodservice and restaurant sectors. With these three countries being the U.S.’s top trading partners, such tariffs could significantly affect the supply chain and pricing of food and beverage commodities. This blog post provides an overview of key imported commodities from these countries and explores how these tariffs could impact restaurant and foodservice businesses.

The Scope of Tariff Proposals 

Trump has proposed a 25% tariff on all products from Canada and Mexico and a 10% tariff on goods from China. While these measures aim to address broader political and economic goals, their implementation could raise prices on essential imports, affecting everything from raw ingredients to finished products used in restaurants.

Food and Beverage Imports from Canada 

In 2023, U.S. imports from Canada totaled $418.6 billion. While petroleum products and motor vehicles dominate this figure, food and beverage imports accounted for a substantial portion, particularly in categories essential to foodservice operators:

• Baked Goods and Pastries: $4.98B
• Rapeseed and Mustard Oil: $4.80B
• Fresh or Chilled Beef: $2.65B
• Chocolate and Cocoa-Based Foods: $1.98B
• Frozen Prepared Vegetables: $1.69B
• Crustaceans (e.g., shrimp, crab): $1.68B

Other notable imports include fresh fish, pork, and sugar confections, all integral to many restaurant menus. Tariffs could increase costs for these products, forcing businesses to adjust pricing or menus.

Food and Beverage Imports from Mexico 

Mexico’s total exports to the U.S. in 2023 reached $475.2 billion, with food and beverage commodities like beer, fresh produce, and baked goods being major contributors:

• Beer (made from malt): $5.69B
• Alcoholic Beverages (spirits): $4.81B
• Fresh Fruits (miscellaneous): $3.86B
• Avocados, Pineapples, and Other Fruits: $3.30B
• Fresh or Chilled Vegetables: $2.96B

Popular items like fresh tomatoes and avocados, critical for dishes like guacamole or salsa, could see price hikes, significantly impacting Mexican and Tex-Mex cuisine providers.

Food and Beverage Imports from China 

In 2023, imports from China to the U.S. totaled $426.9 billion, with food and beverage commodities forming a smaller but impactful portion:

• Fish Fillets and Meat: $985.3M
• Modified Fats and Oils: $763.3M
• Preserved Fruits and Nuts: $445.9M
• Sauces and Condiments: $148.8M
• Pasta and Couscous: $99.0M

Chinese imports often contribute to niche and specialty markets in the U.S., supporting diverse culinary offerings. Tariffs may disproportionately affect businesses relying on these unique products.

Broader Implications of Tariffs 

• Higher Prices for Consumers: Increased import costs may be passed on to consumers, raising menu prices.
• Disrupted Supply Chains: Restaurants could face challenges in sourcing key ingredients, requiring new supplier relationships.
• Disproportionate Impacts: Research suggests low-income households and minority-owned businesses might bear the brunt of these changes.

Advocacy and Industry Response 

Organizations like the National Restaurant Association have called for the disbandment of tariffs like the China 301 tariffs, which have already cost American businesses over $165 billion since 2018. Advocacy efforts aim to highlight the ripple effects of these policies on the restaurant industry and consumers.

Conclusion 

The proposed tariffs on Canada, Mexico, and China could reshape the foodservice landscape, compelling operators to adapt to higher costs and potential supply chain disruptions. Staying informed about these developments and exploring alternative sourcing strategies will be crucial for mitigating the impact on businesses and consumers alike.