Tariffs Add a New Shock to Food Supply Chains
The New York Times
Companies made their supply chains stronger and more flexible because of the Covid pandemic. But they weren’t banking on tariffs.
Victoria Gutierrez has been thinking about avocados a lot lately.
President Trump was warning that hefty tariffs on food and other supplies from Mexico, Canada and China were coming. So Ms. Gutierrez, the chief merchandising officer for Sysco, the global food distributor, and a task force inside the company began sifting through the thousands of suppliers the company works with to see what products could be affected.
The good news for Sysco, a company with nearly $79 billion in annual revenues, was that the shortages and supply-chain challenges arising from the Covid pandemic had caused it to diversify and, in some cases, duplicate its suppliers for key products.
The bad news? Avocados.
“The majority of avocados eaten in the United States come from Mexico. Can we today meet the full demand for avocados in the U.S.? No,” Ms. Gutierrez said in mid-February. She added, “There’s not a lot that’s growing in the United States in the winter.”
On Tuesday, the threat of tariffs became a reality. The Trump administration placed a 25 percent tariff on all imports from Canada and Mexico. It has also added 20 percent tariffs on goods from China this year, on top of levies that remain from Mr. Trump’s first term.
