In a significant move with far-reaching implications for the global food and beverage industry, President Donald Trump announced his new tariff policy on April 2, 2025. The new tariff includes a 10% universal tariff and reciprocal tariffs on imports from over 60 countries. Among the most notable actions are a 25% tariff on all goods imported from Canada and Mexico and a 10% tariff on Chinese imports. These changes are expected to increase production costs and retail prices across multiple segments of the U.S. food and beverage sector.
India, which accounts for approximately 18% of U.S. goods imports, 6.22% of U.S. exports, and 10.73% of total bilateral trade, will also be significantly impacted. Indian exports to the U.S. span 30 sectors, including six agriculture-related categories and 24 industrial sectors. (source: NDTV)
Key Sectors Affected (Source: U.S. Department of Agriculture’s Economic Research Service)
- Alcohol & Wine: This category faces the steepest hike, with a 122.1% increase in tariffs, although current exports stand at only $19.2 million.
- Processed Foods, Sugar & Cocoa: Valued at $1.03 billion in exports, these products will now be subject to a 24.99% tariff, making Indian snacks, confectionery, and related goods substantially more expensive for U.S. consumers.
- Chocolate & Cocoa Products: A 10% tariff on imports from Ivory Coast—a leading exporter of cocoa—will likely lead to price increases on cocoa beans, cocoa paste, butter, powder, and chocolate products across the U.S.
- Nuts: The tariffs may also affect the pricing of nuts such as cashews, pecans, and macadamias. While some macadamia nuts are produced domestically, the U.S. relies heavily on imports from Australia, which now faces a 10% tariff as well.
- Coffee, Seafood, and Olive Oil: These essential grocery staples are also expected to become more expensive due to the lack of tariff exemptions for food products.
Consumer Impact
With no carve-outs for foodstuffs, these tariffs are poised to drive up prices for everyday items at the grocery store. From snacks and beverages to specialty imports, consumers are likely to feel the pinch at the checkout counter. Industry experts advise staying informed about affected categories to make smarter purchasing decisions.
As these policies take effect, manufacturers, distributors, and consumers alike must navigate a changing landscape marked by increased costs and evolving trade dynamics.
