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Trump’s Trade War Troubles Utah Farmers And Businesses

istock / deyanarobova

Utah exporters and business leaders worry a trade war with Mexico, Canada and Europe could harm the state's agriculture and food industries.

After the Trump administration recently announced tariffs on steel and aluminum imported from some of the nation’s neighbors and closest allies, those trading partners responded with their own tariffs on U.S. goods. Some tariffs appear to be political, as they target industries in swing states and the home turf of Congressional leaders Paul Ryan and Mitch McConnell.

But trade wars are messy and Utah industries are getting pulled into the fight, said Derek Miller, president and CEO of World Trade Center Utah.

“Unfortunately, the president has it wrong when he says trade wars are good and easy to win,” Miller said. “They’re not good and they’re hard to win. In fact, trade wars are like regular war. There are no winners, just losers.”

The retaliatory tariffs threaten $122 million in Utah exports of agriculture, food, metal and electrical products to those countries, Miller said.

The U.S.-imposed tariffs on imported steel and aluminum that began this new trade war will affect consumers at home, too. Utah is in a building boom, Miller said, and higher priced metals will make new homes and buildings more expensive.

“It’s higher prices for builders and those builders, in order to be able to stay in business, have to pass along those costs to consumers,” he said. “That’s why I tell people all that time that a tariff is just a fancy name for a tax.”

It may also become more difficult for Utah businesses to export their products. That’s a risk for Utah farmers and ranchers, who are getting pulled into their second tariff fight this year.

In 2017, Utah farmers exported $20 million in pork products to China, which this spring hiked tariffs 25 percent on those same products. Now Mexico is following suit.

“We’re two months out from those China tariffs, so you add the Mexico tariffs and I would imagine that there are some pork farms out there that are getting a little bit concerned about this,” said Jack Wilbur with the Utah Department of Agriculture.

Wilbur said if foreign markets for Utah products become too expensive, farms and businesses will be forced to sell more products at home, which will reduce prices, bringing in less revenue for sellers.

“For the benefit of Utah agriculture, I hope this trade dispute is resolved quickly,” Utah Agriculture and Food Commissioner LuAnn Adams said.

With the latest move, Utah exporters now face new tariffs imposed by their top five trading partners. The tariffs on U.S. goods don’t take effect until July 1, which some Utah trades hope will give President Trump time to rethink his strategy.

Gov. Gary Herbert showed his displeasure with the announcement of new tariffs Friday with a series of tweets.

“I think this administration believes tariffs will help our people," he tweeted. "But I believe protectionism could be catastrophic."

Nicole Nixon holds a Communication degree from the University of Utah. She has worked on and off in the KUER Newsroom since 2013, when she first joined KUER as an intern. Nicole is a Utah native. Besides public radio, she is also passionate about beautiful landscapes and breakfast burritos.
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