Will Trump's tariffs land our major industries in trouble?

The New Zealand Meat Industry Association says it is disappointed by the USA decision to impose tariffs.

The USA is our largest importer of meat. Last year alone Americans consumed more than 217,000 tonnes, putting over 2.7 billion dollars (NZD) into the pockets of Kiwis. The meat is used in restaurants, fast food chains like McDonalds, and sold in their supermarkets.

CEO of the NZ Meat Industry Sirma Karapeeva says the announcement is likely to impact the global beef market as tariffs distort trade and reduce market efficiency leaving consumers with fewer choices and higher costs.

Despite the measures, Karapeeva still expects high demand out of the U.S. and says it's likely to push exporting countries to redirect their products to markets where New Zealand also operates.

More than 130 countries and territories were given a base tariff of 10% by the Republicans, however the rest weren’t so lucky. Cambodia topped the listed getting slapped with a whopping 49% tariff.

The aim of the tariffs is to shift interest away from imported produce by making it more expensive, which in turn will create more demand for domestic goods. However as of January 1, 2025, the U.S. beef inventory fell to 86.7 million head of cattle and calves, which is the lowest rate in 64 years.

As well as our red meat, Americans also love a bottle or two of our wine, importing over $750 million (NZD) worth annually. CEO of NZ Winegrowers Philip Gregan says the tariff will cause serious concern to wineries and wine growers all over the country. The tariffs will also affect the U.S. wine maker and its consumers, he says.

Trade economist at the University of Canterbury Onur Koska suggests uncertainty around trade and disruptions to global supply chains could pose an even bigger threat than the tariffs themselves.

“Consumers always pay the price in trade wars."

While New Zealand could impose retaliatory tariffs, Koska argues the country is too small to significantly impact global prices. Businesses dealing with regions affected by tariffs will likely face long-term pressure and will need to consider diversifying their operations to adapt, he says.

Last year New Zealand exported over $14 billion (NZD) in goods and services to the U.S. with our main products being red meat, dairy and wine. To make up for this new added expense, businesses in these sectors may have to resort to increasing their product prices, however the effects this will have on Kiwis is as yet unknown.