Tariff war: new challenges for the European food industry

By: Trademagazin Date: 2025. 08. 21. 12:30

The trade agreement concluded at the end of July between the United States and the European Union could significantly reshape the global food market. While the EU has successfully preserved its globally unique food safety standards, the increase in U.S. tariffs poses a serious challenge for European exporters – writes Dr. Tibor András Cseh, Secretary-General of MAGOSZ and Vice President of the National Chamber of Agriculture, in his article on VG.hu.

Until now, food trade between the EU and the USA has clearly favored Europe: EU exports were two and a half times the value of U.S. food imports. For the European food industry, America is the second largest export partner, purchasing primarily processed products such as wine, spirits, dairy products, baked goods, and seafood. In contrast, for the United States, the EU is only the fifth most important market.

Tariffs: back in the spotlight

In recent years, the importance of tariffs in international trade has diminished. On average, EU products faced only a 2 percent tariff in the USA, while American goods faced nearly 9 percent in the EU. However, the new agreement caps tariffs on EU products at 15 percent, with some categories – such as wines and spirits – expected to see zero tariffs introduced. At the same time, U.S. exporters have received significant concessions: they will be able to sell larger quantities of fishery products, soybean oil, nuts, and bioethanol.

From Hungary’s perspective, the loosening of quantitative restrictions on bioethanol imports is particularly concerning. This could weaken the competitiveness of Hungarian ethanol plants and indirectly worsen market prospects for maize growers. Although the EU has maintained non-tariff barriers – such as the ban on hormone-treated beef and chlorine-washed poultry – market pressure may still intensify.

On the verge of market realignment

The consequences of the U.S. trade war are not limited to rising prices but also signal a global market realignment. If Mexico, Canada, or even the EU finds it harder to access the U.S. market, these countries will seek new outlets – most likely in Europe. This could intensify competition in the European food market, especially if the EU simultaneously reduces its own producer subsidies.

The effects of the U.S. tariff war may therefore reach Europe and Hungary primarily indirectly: through the reshaping of global trade balances. Heightened price competition and the arrival of new players could, in the long run, fundamentally transform the functioning of the food industry – both across the continent and in Hungary.