The last monthly update on agri-food trade with data until October 2019 confirmed a favourable trend of EU food exports to the US ahead of punitive tariffs promised by the Trump administration.
In the 12-month period from November 2018 to October 2019, the US remained the main export destination for European food and drink products accounting from €24.3 billion, with a gain in annual values of €2.2 billion.
This is the second-biggest increase in value recorded, second only to the boom of exports to China due to the pork meat crisis caused by a swine fever epidemic in Asia, which is already disrupting the whole global meat trade.
A similar trend was recorded in the previous months as well, but this spike might be the last as the US administration announced punitive tariffs on EU agri-food products after World Trade Organisation (WTO) had ruled in their favour over EU subsidies for the European aircraft manufacturer Airbus.
The tariffs concern imports of EU products worth a total of €6.8 billion, ranging from Italian cheeses to French wines and Scotch whisky, while the decision has already triggered strong reactions across Europe and threatens to escalate an already heated transatlantic trade row.
Contacted by EURACTIV, experts from the food and drink manufacturers organisation COPA-COGECA said that the effects of the tariffs threat will be displayed slowly, as most contracts for export had been been negotiated months before the announcement.
However, the strength of EU agri-trade to the US in October could be considered as a side effect of the tariffs’ announcement itself.
According to Coldiretti, a leading organisation of farmers representing more than one and a half million members in Italy, the sale of Italian iconic cheese products such as Parmigiano Reggiano and Grana Padano boomed in the US the first week of October, recording an increase of 220%.
The reason behind the hike is that US consumers and restaurateurs started to stock up cheese, fearing an increase in prices in the months to come.
Tariffs for Italian cheese will go from the current price of $2.15 kilogram to about $6 per kilogram after tariffs, explained Coldiretti, while the US association of dairy products importers estimated that a truckload of cheese will cost up to $800,000 more.
On 9 January, the acting Spanish industry and trade minister Reyes Maroto met EU trade Commissioner Phil Hogan in Brussels to seek a “firm and forceful” response to the possible tariffs, calling for additional support measures for the agri-food sector.
Hogan told the Spanish minister that there is a “predisposition” in the US administration to negotiate. If that is the case, “we have to take advantage of that window of opportunity,” Maroto added.
However, both Hogan and Maroto seemed optimistic that a negotiated solution could be found, given that in the coming months the WTO will authorise Europeans to impose tariffs on the US for similar aid given by Washington to Boeing.
(Edited by Benjamin Fox)