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Trump scraps tariffs on beef, coffee and other goods as grocery store prices rise

France 24

France

Friday, November 14


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President Donald Trump signed an order Friday to lower US tariffs on agricultural imports such as beef, bananas, coffee and tomatoes, as his government comes under pressure from voters grappling with the rising cost of living.

These products are now exempted from his"reciprocal" tariffs, imposed this year to address behaviour deemed unfair, after the administration considered issues such as the US capacity – or lack thereof – to produce certain goods.

The"Liberation Day" tariffs originally announced by Trump in April were roughly calculated based on the bilateral trade deficit between the US and specific countries rather than reflecting foreign tariffs on US goods.

The new tariff exemptions are backdated, so they technically took effect on Thursday, according to the order published by the White House.

The Trump administration has been stepping up efforts to convince Americans of the economy's strength as affordability concerns emerged as a key issue in this month's elections for New York City mayor, and the governors of New Jersey and Virginia.

Democrats swept all three of those races with an intense focus on cost of living issues.

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THE DEBATE
THE DEBATE © FRANCE 24

The list of tariff exemptions published Friday also covers other produce such as avocados, coconuts and pineapples.

Among the products targeted are commodities that the United States imports in order to meet domestic demand.

The majority of America's coffee comes from abroad, and coffee prices have jumped by around 20 percent in August and September, respectively.

Part of the reason involved climate shocks, but costs have also been disrupted by tariffs.

National Coffee Association president Bill Murray said the White House move will help"ease cost-of-living pressures for the two-thirds of American adults who rely on coffee each day" and secure supplies for US companies.

Beef prices have been rising this year as well, in part due to a tighter supply of cattle.

Ground beef, as of the latest available data for September, was nearly 13 percent more expensive, according to Consumer Price Index data, and steaks cost almost 17 percent more than a year ago.

Increases for both were the largest in more than three years, dating back to when inflation was nearing its peak under Trump's predecessor, Democrat Joe Biden, following the global COVID pandemic and Russia's invasion of Ukraine.

Although the US is a major beef producer, a persistent shortage of cattle in recent years has kept beef prices high.

Banana prices were about 7 percent higher, while tomatoes were 1 percent higher. Overall costs for food consumed at home were up 2.7 percent in September.

On Friday, the White House said that"certain qualifying agricultural products will no longer be subject to those tariffs, such as certain food not grown in the United States".

'We're going to fix it'

Bananas are another product that will now be exempt from certain US tariffs.
Bananas are another product that will now be exempt from certain US tariffs. © Joe Raedke, Getty Images North America via AFP

Washington's latest announcement comes a day after it unveiled trade agreements with Argentina, Guatemala, Ecuador and El Salvador.

Under the deals, Washington committed to removing"reciprocal" tariffs as well on certain goods that the United States cannot grow, mine or produce in sufficient quantities.

Since returning to the presidency in January, Trump has imposed sweeping tariffs on US trading partners, sparking warnings from economists that these could fuel inflation and weigh on growth.

While there has not been a sharp uptick in overall consumer inflation, policymakers have noted that tariffs pushed up prices of certain goods.

They expect the effect of higher levies to continue filtering through the world's biggest economy.

The Trump administration has acknowledged affordability worries that Americans are facing, with Trump's top economic advisor nodding to a loss of purchasing power in recent years.

"That's something that we're going to fix, and we're going to fix it right away," Kevin Hassett, director of the White House National Economic Council, said this week.

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