ABN AMRO: Food exports to the US could be cut in half

The Dutch food industry could take a major hit from a potential new 25 percent import tariff on all European goods, which Trump is considering. During his first term, the impact on the Netherlands remained limited, as key export products such as cheese were not affected by tariff increases. This time, the outcome could be different.

The Netherlands exports over €2.3 billion worth of food and beverages to the US each year, accounting for 3 percent of total exports. According to ABN AMRO, the introduction of this tariff could reduce food exports to the US by more than half, resulting in a loss of €1.3 billion. Across the entire sector, this would mean a decline of 1.5 percent.

Biggest risks for fish, chocolate, and alcohol

The impact varies significantly by product category. Fish, particularly processed salmon, could see exports drop by up to 70 percent. The cocoa and chocolate sector would also take a major hit, with an expected sales decline of 60 percent. However, part of the damage may be softened, as a significant share of these exports involves transit trade. Producers of alcoholic beverages, such as beer and spirits, currently export 15 percent of their production to the US and are expected to see their American sales shrink by 52 percent.

Limited impact on dairy

For exports of dairy, grain, and coffee, the losses are expected to remain relatively contained, with an estimated decline of 40 percent. Companies can mitigate the impact by finding new markets, adjusting prices, or relocating production to countries not affected by the tariff. The final impact will depend on possible countermeasures from the EU and the credibility of Trump’s threat.

Abnamro.nl