When imported food, wine, and especially champagne face tariffs that make much of the food unaffordable, a domino effect of people and businesses are impacted, from specialty food and wine shops large and small to restaurants to distributors. (The Motley Fool as well as many other news outlets are chronicling the possible fall-out.)
Who will win when the 2020 food tariffs take effect and who stands to lose?
Here’s how I see it…
LOSERS: Food manufacturers that depend on certain ingredients or flavor profiles that cannot and are not produced in the United States will see higher food ingredients costs, perhaps sometimes so high that the price of the food is no longer profitable. In turn, consumers will lose by paying more and losing choice.
WINNERS: American specialty food producers – especially Good Food Award winners and winners of the Specialty Food Association sofi award – will benefit from more competitive prices and fewer similar European products on shelves.
LOSERS in the tariff “game” will include importers from various European countries, whose products will increase in price for American consumers. A representative for Italian Parmiggiano Reggiano cheese says: “This comes on the heels of the World Trade Organization’s decision to grant permission to the Trump administration to impose a tax of as $7.5 billion of European food exports annually, including an additional duty of 25% on Italian Protected Designation of Origin products such as Parmigiano Reggiano.”
WINNERS & LOSERS: People who long for the day when you couldn’t buy everything everywhere, when you had to go to Europe to buy small production cheeses, meats and other foods, when you could only get certain libations when you visited the origin…those are the people who will benefit from the tariffs when the foods and drinks they love are no longer available in the United States. Travel and hospitality businesses will benefit, as people travel more often to fulfill their food desires. That is, if many of the producers don’t go out of business after losing the American market.Photo by Susie Wyshak
WINNERS: American growers of products that are subject to tariffs such as nuts, wine and olives, as well as olive oil, will benefit from tariffs. Today gives a rundown on more foods impacted by tariffs. Photo by Susie Wyshak
LOSERS are importers, imported food distributors and specialty food shops that focus on imported food who will face prices so high on some items that customers just can’t afford to pay. It’s a coincidence that I captured this photo of some customers at Market Hall Foods dressed for the Dickens fair…because these tariffs are returning the United States food scene to Dickensian times. Market Hall is known for its European holiday cookies, and of course stores like Cost Plus World Market have a perennial selection of what will be formerly-cheap European cookies such as those buttery biscuits from Britain. Photo by Susie WyshakWhile something inside me that years for the past has a tinge of excitement about having to seek out foods abroad, there is a profound sadness of the vast negative impact the tariffs will have on American small businesses as well as old-time European food producers.
The tariffs couldn’t come at a better time.
It’s bittersweet that the tariffs are happening in 2020 after the U.S. has developed a thriving craft foods, wine and spirits industry.
Ironically, multiple major European dairies and liquor companies not to mention Lindt have acquired many of the best and largest American producers.
The “right” people are not losing from these tariffs.
Hopefully by January 2021, we’ll see action to reverse the tariffs. Hopefully it will not be too late for the many businesses who anticipate these tariffs could force them to shut their doors.
