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President Donald Trump’s blanket tariffs scheduled to begin on Aug. 1 could soon bring higher prices on certain foods, according to some experts.
Tariffs are a tax imposed by foreign nations, paid by domestic companies that import goods or services. U.S. consumers are expected to pay higher prices via companies negatively impacted by the trade policy.
One of the goals of Trump’s tariffs is to drive demand for American products. But certain items, such as Brazilian coffee, aren’t produced domestically. Other imports, like bananas, have limited U.S. production, which wouldn’t meet American demand, according to a Tax Foundation analysis published Monday.
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In some cases, U.S. consumers may decide to pay more for these imported food products rather than choosing a substitute, wrote Tax Foundation senior economist Alex Durante.
In 2024, U.S. food product imports totaled about $221 billion. Most of these products already face tariffs ranging from 10% to 30%. However, levies could exceed 30% for some countries if Trump’s Aug. 1 tariffs go into effect, the Tax Foundation found.
“We could see some large movements in prices over the next few months if the administration holds firm to that Aug. 1 deadline,” Durante told CNBC.
The top five imported foods by volume that could face tariffs are liqueurs and spirits, baked goods, coffee, fish and beer, which account for roughly 21% of total U.S. food imports, according to the Tax Foundation analysis.
Grocery prices were about 2.4% higher than one year ago, according to the latest inflation report based on June data. But the full impact of Trump’s tariffs is not yet reflected, experts say.
“It’s way too soon for the administration to be doing a victory lap because most of their planned tariff increases have not gone into effect yet,” Durante told CNBC.
A separate analysis by The Budget Lab at Yale, also from Monday, estimated that tariff price increases to date will raise food costs by 3.4% in the short-run, and that prices will stay 2.9% higher in the long-run. Fresh produce could initially be 6.9% more expensive while stabilizing at 3.6% higher, the analysis found.
“The Administration has consistently maintained that the cost of tariffs will be borne by foreign exporters who rely on access to the American economy, the world’s biggest and best consumer market,” White House spokesperson Kush Desai told CNBC in a statement.
Desai also shared a July analysis from the White House’s Council of Economic Advisers, which showed the prices of imported goods, as measured by the personal consumption expenditure price index, fell from December through May.
