Escalating tariff war and search for new markets: European food exports in a difficult situation

America: from export partner to negotiating partner – tariffs are a weapon

The United States is the second most important market for European food producers, especially for products such as wine, cheese and olive oil. The value of EU exports is two and a half times the value of food imported from the US. However, as part of the protectionist turn marked by Donald Trump’s name, punitive tariffs were announced on European products, which were later reduced to 10% and suspended for three months – but uncertainty still persists.

The response was not long in coming: the EU had prepared a €21 billion countermeasure package that would have imposed tariffs on American soybeans, almonds, meat, orange juice and white chocolate, among other products – but their introduction was also suspended in response to the US delay.

“Soft barriers” instead of tariffs

While neither side wants to escalate the conflict immediately, “non-tariff barriers” have also been on the agenda. EU Trade Commissioner Maroš Šefčovič has suggested that the strictness of European food safety regulations could also be a tool. Such restrictions could include:

a ban on the import of chlorine-washed poultry,

the exclusion of GMO crops,

or a ban on the import of hormone-treated meat.

There have also been reports from the US that one of the conditions for lifting the tariffs would be for the EU to limit its trade relations with China – a politically unacceptable step for Brussels.

China: a promising but complicated partner

Many would see China as a natural alternative given the limited size of the US market, but EU-China relations are not without tensions. In response to EU tariffs on electric cars, Beijing has imposed tariffs on lysine, a feed ingredient, and instead of expanding agricultural cooperation, new barriers are being built.