The White House has announced a one-month suspension of tariffs on USMCA-compliant imports from Mexico and Canada. This pause aims to provide relief to the food industry and follows an exemption on automotive imports. President Trump emphasized this decision’s significance for American production and trade relations with neighboring countries.
On Thursday, the White House announced a temporary suspension of tariffs on imports from Mexico and Canada that comply with the United States-Mexico-Canada Agreement (USMCA), effective until April 2. This development also extends to goods from Canada that meet USMCA criteria, joining Wednesday’s exemption for car imports from both countries.
President Donald J. Trump stated that the tariff adjustments recognize the automotive supply chain’s structure, which aims to boost production in America. Reports indicate that approximately half of Mexico’s imports to the United States are USMCA compliant, alongside nearly 40% of those from Canada, according to a White House official.
This tariff pause offers some relief to the food industry, given that nearly all agricultural products fall under the USMCA’s scope. An increase in tariffs would have raised prices of various goods, including avocados and tomatoes from Mexico, as well as oats and canola oil from Canada.
Zippy Duvall, President of the American Farm Bureau Federation, emphasized the need for a permanent resolution of trade issues with Mexico and Canada to maintain crucial markets for farmers and ensure access to necessary supplies for the U.S. food system.
The looming 25% tariff on steel and aluminum imports remains on schedule for enactment on March 12, which food and beverage companies have warned could lead to increased packaging costs. A universal reciprocal tariff policy is also being prepared to take effect on April 2, coinciding with the end of the current tariff pause.
In a collaborative effort, President Trump and Mexico’s President Claudia Sheinbaum agreed on the tariff suspension, with the former expressing respect for Sheinbaum’s cooperation regarding fentanyl trafficking. Sheinbaum affirmed her commitment to working together on issues related to migration and safety, including reducing the illegal flow of fentanyl into the U.S.
In summary, the White House has temporarily suspended tariffs on imports from Mexico and Canada that comply with the USMCA, effective until April 2. This pause is a strategic decision benefiting both the automotive and agricultural sectors, providing essential relief to American farmers and food industries. However, impending tariffs on steel and aluminum pose challenges that require urgent attention. The agreement reflects a commitment to collaborate on broader issues, ultimately aimed at enhancing trade relations and ensuring supply chain stability.
Original Source: www.fooddive.com
