Here’s what will get more expensive from Trump’s tariffs on Mexico, Canada and

CNN
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On Saturday, President Donald Trump made good on his promise to impose steep tariffs on America’s three largest trading partners — Canada, China and Mexico — citing a national emergency on the flow of fentanyl and undocumented immigrants into the United States.

The action, which is expected to take effect on Tuesday, includes a 25% duty on all imports from Mexico and most goods from Canada (there’s a 10% carve-out for energy-related items such as crude oil), and an additional 10% tariff on Chinese goods imported into the United States.

Trump has used and promised to employ tariffs for three primary purposes: to raise revenue, to bring trade into balance and to bring rival countries to the negotiating table.

However, economists warn that these moves negatively impact American businesses and consumers, many of whom are still reeling from the sharp rise in inflation in recent years.

The US Chamber of Commerce warned Saturday that tariffs won’t solve the yearslong issues at the borders and instead threaten to “upend supply chains” and raise prices for American families.

“Consumers are going to be clearly worse off,” Sung Won Sohn, professor of finance and economics at Loyola Marymount University and chief economist at SS Economics, told CNN on Saturday.

“When you talk about a tariff, it’s an economic war; and in war, everybody loses,” he added. “But hopefully we will come to some better results and conclusions as a result of the pain and suffering that we will go through.”

About one-third of US imports come from the three countries Trump targeted Saturday. Their products are among some of the most commonplace and critical items used by Americans, including fruits and vegetables, meat, gas, automobiles, electronics, toys, clothing, lumber, and beer and spirits.

Mexico and Canada supply a significant share of several key food categories. For example, Mexico is the largest supplier of fruit and vegetables to the US, while Canada leads in exports of grain, livestock and meats, poultry and more.

Agricultural products from Mexico and Canada, in particular, could become more expensive for consumers, as grocery retailers operate on thinner profit margins than most industries. With little room to absorb higher tariff costs, the grocers may have to pass them on to shoppers.

Although the US typically exports more agricultural goods than it imports, the value of imports has increased faster than that of exports in the past decade, according to the US Department of Agriculture. Additionally, climate change has increased US reliance on countries like Mexico, where growing conditions are more favorable.

Last year, the US imported $46 billion of agricultural products from Mexico, according to USDA data. That includes $8.3 billion worth of fresh vegetables, $5.9 billion of beer and $5 billion of distilled spirits.

But the biggest category of agricultural imports from Mexico last year was fresh fruits, of which the US imported $9 billion worth, with avocados accounting for $3.1 billion of that total.

Fuel and energy

The US imported $97 billion worth of oil and gas from Canada last year, that country’s top export to the US. The US has become more reliant on Canadian oil since the expansion of Canada’s Trans Mountain pipeline, according to data from the US Energy Information Administration.

The tariff on Canadian energy products is only 10%, not the 25% tariff announced on other Canadian exports.

That’ll limit the impact on gasoline prices, said Tom Kloza, global head of energy analysis for OPIS.

Another factor is the time of year. Gas prices are typically near a low for the year in February due to weak demand. If the tariffs stay in place through summer, the impact will be greater, he said.

And while the impact isn’t expected to be felt equally nationwide, it likely will hit America’s Heartland the hardest.

Most Canadian oil is shipped to Midwest refineries via pipeline, Kloza said. The states most likely to be affected are Idaho, Illinois, Indiana, Iowa, Kansas, Kentucky, Michigan, Minnesota, Missouri, Montana, Nebraska, North Dakota, Ohio, Pennsylvania, South Dakota and Wisconsin, he…