‘Expect the unexpected in Trump’s tariff saga’

After President Trump’s announcement of new US tariffs, the global economy, including the horticulture sector, has been feeling increasingly uncertain. In the UK, this is just another factor adding to the pressure that the sector has been facing over the last five years, such as rising production costs, food inflation, labour shortages, Covid, and the still-rumbling after-effects on inward and outward trade flows post-Brexit. Anything that adds to these supply chain shocks in the UK is unwelcome. In these circumstances, horticultural companies need to be resilient and nimble in how they operate.

The picture might look quite pessimistic, however it could be argued that until a few days ago, the UK was one of the “winning” countries – if it is possible to have these – in what overall appears to be a “lose-lose” situation. Nevertheless, with a 10 per cent tariff, the UK was in a much better situation than our neighbours in the EU, who faced a 20 per cent import tariff. Meanwhile, countries such as Cambodia and Vietnam faced tariffs of 49 per cent and 46 per cent respectively. And China was hit with a total effective tariff of 54 per cent, due to the pre-existing 20 per cent tariff imposed earlier in 2025.

In this fast-changing geopolitical environment, these tariffs could increase again at any time – almost overnight in some cases. And they did. The US announced it would revert to a flat 10 per cent tariff for all countries, with the exception of China. And this situation will last for 90 days. After that, there is uncertainty as to what happens next.

The effect of the US reciprocal tariffs on the UK horticulture sector would, of course, have the biggest impact on companies exporting to the US. However, the total impact on fruit and vegetables is not as concerning as in other UK sectors, such as cheese, whisky, chemicals, cars and services.

Horticultural exports from the UK to the US were relatively small in 2024, reaching a value of US$11.5 million for vegetables and just US$0.5mn for fruits. Looking at the US from 2015 to 2024, the UK accounted for less than one per cent of the total US imports for fruit and vegetables respectively. UK companies who export have tended to focus on other EU markets, the Gulf region, and Southeast Asia, as opposed to the US. UK exports account for less than one per cent of the US total.

For the UK, the knock-on effects of the new US tariffs might be less directly related to the horticultural sector per se, but rather the threat of the world economy falling into recession. One only has to look at the initial reaction of world stock markets over the last week to the current situation, and how volatile stock markets are at the moment, to see the dangers of this. A severe global recession would help no one.

How other countries will be affected varies because of the tariff itself and the level of trade with the US. Countries such as Mexico will be dramatically impacted as they are facing a potential import tariff of 25 per cent. In the last few years, they have accounted for 61 per cent and 42 per cent of the total US imports of fruits and vegetables respectively. Canada is also facing a 25 per cent import tariff and accounted for 18 per cent of the total US imports of vegetables in the last 10 years.

Other Latin American countries, such as Chile and Peru already faced a 10 per cent import tariff and accounted for 11 per cent and eight per cent of the total US fruit imports in the same timeframe. Asian countries, such as China and Vietnam, face potential import tariffs of 46 per cent. And China’s tariff might rise to a staggering 145 per cent.

All these countries will be far more impacted than the UK. How exporting countries to the US will react to the 10 per cent tariffs is not yet fully known. Some countries are looking to reach out to the White House to negotiate for lower tariffs. This approach has been taken by more than 50 countries in the first five days after the initial tariff announcements. How successful they will be beyond the 90-day period mentioned above is unclear.

Other countries initially reacted by increasing their own tariffs on the US. The most notable examples are China and Canada, which have imposed 84 per cent and 25 per cent tariffs on US products (at the time of writing), respectively. The UK is playing a “waiting game” to determine the best course of action. And the option of maybe not taking any retaliatory tariff actions is still on the table.

Will the UK be the key target market for displaced US exports going forward? We think this is unlikely but cannot be totally discounted. However, the UK is a mature market, and the levels of imports for many of the products the US looks to export are relatively static. For any export source, the UK is not an easy “win” in the short term. The leading supermarkets have a strategy of buying through contracts agreed well in advance and insist upon exacting technical and commercial standards from their suppliers.

The domestic US market, due to its size, could absorb some of the volumes that would otherwise be part of US exports. This may, in the short term, be the most obvious opportunity, especially if imports are restricted. More produce on the US market could see prices supressed unless demand also increases. This is good for consumers, but less so for producers and distributors.

The imposition of these reciprocal tariffs by the US has introduced a new layer of complexity and uncertainty to the global economy. While the UK could still find itself in a better position compared to many other countries, the overall impact on global trade dynamics cannot be understated. Countries like Mexico, Canada and China – which have significant trade volumes with the US – are likely to experience substantial disruptions to trade. The potential for market diversification exists, but it presents significant challenges and requires time to develop viable alternatives to the US market.

The global economy’s resilience will be fully tested as countries navigate these new trade barriers. The horticulture sector, along with other industries, must adapt to these changes, exploring new markets and strategies to mitigate the adverse effects of the tariffs. Only the coming months will reveal the true extent of the impact on, and the effectiveness of, the responses from the international fruit and vegetable sector.

What seems clear is that these tariff developments are not over yet. The last few days have taught us to “expect the unexpected”. And this type of uncertainty is the way things will be, at least for the short term.

Edwin Reyes is a senior consultant with Promar International, the agri-food consulting arm of Genus plc. He has worked on fresh produce assignments in the UK, the EU, Central and North America, Southeast Asia, the Gulf region, and China.