WASHINGTON, Nov 16 — United States (US) President Donald Trump has rolled back tariffs on more than 200 food products, including such staples as coffee, beef, bananas, and orange juice, in the face of growing angst among American consumers about the high cost of groceries.
The new exemptions, which took effect retroactively at midnight on Thursday, mark a sharp reversal for Trump, who has long insisted that the sweeping import duties he imposed earlier this year are not fueling inflation.
"They may in some cases" raise prices, Trump said of his tariffs when asked about the move aboard Air Force One on Friday evening. But he insisted that overall, the US has "virtually no inflation."
Democrats have won a string of victories in state and local elections in Virginia, New Jersey, and New York City, where growing voter concerns about affordability, including high food prices, were a key topic.
Trump also told the press that he would move forward with a US$2,000 (RM8,265) payment to lower- and middle-income Americans that would be funded by tariff revenues sometime next year.
"The tariffs allow us to give a dividend if we want to do that. Now we are going to do a dividend and we are also reducing debt," he said.
The Trump administration announced framework trade deals on Thursday that, once finalised, will eliminate tariffs on certain foods and other imports from Argentina, Ecuador, Guatemala, and El Salvador, with US officials eyeing additional agreements before the year's end.
Friday's list includes products US consumers routinely purchase to feed their families at home, many of which have seen double-digit year-over-year price increases. It contains over 200 items ranging from oranges, acai berries, and paprika, to cocoa, chemicals used in food production, fertilisers, and even communion wafers.
The White House's fact sheet on the order said it came on the heels of "significant progress the President has made in securing more reciprocal terms for our bilateral trade relationships."
It added that Trump decided certain food items could be exempted since they were not grown or processed in the US, and given the conclusion of nine framework deals, two final agreements on reciprocal trade, and two investment deals.
According to the latest Consumer Price Index data for September, ground beef was nearly 13 per cent more expensive, and steaks cost almost 17 per cent more than a year ago. Increases for both were the largest in more than three years, dating back to when inflation was nearing its peak under Trump's predecessor Joe Biden.
Although the US is a major beef producer, persistent shortages of cattle in recent years have kept beef prices high.
Banana prices were about seven per cent higher, while tomato prices were one per cent higher. Overall food costs at home were up 2.7 per cent in September.
The tariff exemptions won praise from many industry groups, while others expressed disappointment that their products were excluded.
"Today’s action should help consumers, whose morning cup of coffee will hopefully become more affordable, as well as US manufacturers, which utilise many of these products in their supply chains and production lines," FMI-Food Industry Association president Leslie Sarasin said in a statement.
Meanwhile, Distilled Spirits Council president Chris Swonger said that excluding spirits from the European Union and the United Kingdom "is yet another blow to the US hospitality industry just as the critical holiday season kicks into high gear."
"Scotch, Cognac, and Irish Whiskey are value-added agricultural products that cannot be produced in the United States," he said.
When asked if further changes were planned, Trump said: "I do not think it will be necessary."
"We just did a little bit of a rollback. The prices of coffee were a little bit high, now they will be on the low side in a very short period," he said.
New focus on affordability
Trump has upended the global trading system by imposing a 10 per cent base tariff on imports from every country, plus additional specific duties that vary from state to state.
He has focused squarely on affordability in recent weeks, while insisting that any higher costs were triggered by Biden's policies, not his own tariffs.
Consumers have remained frustrated over high grocery prices, which economists say have been fueled in part by import tariffs and could rise further next year as companies start passing on the full brunt of the import duties.
The top Democrat on the House of Representatives Ways and Means Committee, Richard Neal, said the Trump administration was "putting out a fire that they started and claiming it as progress."
"The Trump Administration is finally admitting publicly what we have all known from the start: Trump's Trade War is hiking costs on people. Since implementing these tariffs, inflation has increased and manufacturing has contracted month after month," he said in a statement.
