Tariffs On Some Grocery Items Lifted, But Holiday Price Relief Is Elusive

President Donald Trump has lifted retaliatory tariffs on certain imported foods, but consumers shouldn’t expect to immediately see relief in their grocery bills, economists caution.

With his administration facing blowback from consumers over higher grocery prices, Trump earlier this month rolled back tariffs on more than 200 grocery items from “countries that produce substantial volumes of agricultural products that are not grown or produced in sufficient quantities in the United States.”

That includes “coffee and tea; tropical fruits and fruit juices; cocoa and spices; bananas, oranges, and tomatoes; and beef,” according to the statement.

In a later announcement, the White House said it is rolling back the 40 percent reciprocal tariff on certain products from Brazil, a key supplier of beef and coffee to the United States. Before the tariffs, Brazil, the world’s top coffee producer, supplied about 30 percent of the U.S. coffee market.

The tariffs remain in effect on the majority of consumer goods, including toys and holiday decor that are predominantly imported from China.

It will take time before the lower import taxes are reflected at the grocery store, according to supply chain experts. Food and other commodities imported and stored in warehouses were purchased under the higher duties and will be reflected in prices for an uncertain period of time.

“Supply chains do not react that quickly to pricing actions, whether from the president or organic fluctuations of market conditions,” Phil Kafarakis, CEO of food industry association IFMA, told CNBC.

Other supply chain disruptions, including those caused by the COVID-19 pandemic and the blockage of the Suez Canal by the mega container vessel the Evergiven, show it takes about six months for prices to increase, and another half a year for them to go down once the problems are resolved, CNBC reported.

“The effects of this executive order will not be felt by consumers for an extended period of time,” Kafarakis told the news outlet. “We might see some relief for tomatoes and strawberries in the spring.”

Stores may see sales on items such as coffee and cheese, but “for a limited time or in limited quantities,” to drive foot traffic into the store, Kafarakis said.

The European Commission plans to ask for tariff rollbacks on a range of goods, ranging from food products such as cheese, pasta, wine and spirits, and olive oil to sunglasses, diamonds, tools, metal pipes, ship engine parts, industrial equipment, fabrics, shoes, hats, ceramics and industrial robots, Politico reported.

Tariffs May Not Relieve Beef Prices

Tariffs aren’t the only reason for record-high beef prices.

The rapid spread of the deadly New World screwworm in Mexico prompted the USDA to close southern border ports to livestock trade in May, cutting off a key market for U.S. ranchers struggling to meet consumer demand for beef as the domestic cattle inventory is at a 70-year low.

Before Trump’s tariffs, Brazil was the largest importer of beef to the U.S. Trump also lifted 10 percent tariffs on imports of beef from Australia, Argentina and Uruguay, and a 15 percent tariff on New Zealand’s beef imports.

The increase of beef imports from Brazil may help insulate consumers while ranchers and feedlots confront a bigger blow.

Tyson Foods, the world’s second-largest beef processor, announced it is closing a plant in Lexington, Nebraska to shutter a plant that slaughters about 5,000 head of cattle a day. Tyson also plans to cut one of the two shifts at a plant in Amarillo, Texas, and eliminate 1,700 jobs there. Together those two moves will reduce beef processing capacity nationwide by 7 percent to 9 percent.

Consumers may not see prices change much at the grocery store over the next six months because all the cattle that are now being prepared for slaughter will still be processed, potentially just at a different plant. But in the long run, beef prices may continue to climb even higher than the current record highs unless American ranchers decide to raise more cattle, which they have little incentive to do.

The prospect of losing a major buyer for cattle and increasing imports from Brazil, which already accounted for 24% of the beef brought into the country this year, only adds to doubts about how profitable the U.S. cattle business might be over the next several years, making it less likely that American ranchers will commit to raising more animals.

“There’s a just a lack of confidence in the industry right now. And producers are unwilling to make the investment to rebuild,” said Bill Bullard, president of Ranchers-Cattlemen Action Legal Fund United Stockgrowers of America.

Cranberry Sauce Up 46%

Coffee and beef aren’t the only items causing sticker shock for consumers as Thanksgiving kicks off weeks of holiday celebrations centered around food.

Overall, the grocery pricing research group Datasembly expects a typical market basket for Thanksgiving dinner to cost $61.14 this year, a 7.09 percent increase from 2024’s $57.09.

A 10-pound frozen turkey costs about $24, a 6.67 percent increase from 2024, due to bird flu increases that shrank the U.S. turkey flock to a 40-year low this year.

Many stores are offering discounted or even free turkeys to soften the potential blow to Thanksgiving meal budgets. But even if the bird is cheaper than last year, the ingredients to prepare the rest of the holiday feast may not be. Tariffs on imported steel, for example, have increased prices for canned goods.

Farok Contractor, a distinguished professor of management and global business at the Rutgers Business School, told The Associated Press that customers are paying 10 cents to 40 cents more per can when companies pass on the full cost of tariffs.

Canned jellied cranberry sauce, a staple on many Thanksgiving tables, costs about 46 percent more than last year, according to Datasembly. Tariffs on imported aluminum and steel helped drive up packaging costs, but U.S. cranberry production is expected to be down 9 percent this year due to weather conditions, including a drought in Massachusetts, the second-largest U.S. cranberry supplier.

That analysis also showed a box of stuffing costs $3.45, a 14.24 percent increase from 2024, and a 12-ounce jar of gravy costs $2.90, up 14.17 percent from last year.

Some prices are declining, including prices for pumpkin pie mix, which are down 5.33 percent this year.

In Illinois, where most of the country’s canning pumpkins are grown, dry weather actually helped pumpkins avoid diseases that are more prevalent in wet conditions, said Raghela Scavuzzo, an associate director of food systems development at the Illinois Farm Bureau and the executive director of the Illinois Specialty Growers Association.

Thanksgiving Pricing Varies

Pricing out Thanksgiving meals isn’t an exact science, and the Datasembly’s tally differed from other estimates.

The American Farm Bureau Federation, which uses volunteer shoppers in all 50 states to survey prices, reported that Thanksgiving dinner for 10 would cost $55.16 this year, or 5 percent less than last year. The Wells Fargo Agri-Food Institute, using NielsenIQ data from September, estimated that feeding 10 people on Thursday using store-brand products would cost $80 this year, which is 2 percent to 3 percent lower than last year's estimate.

Some retailers, including Aldi, Kroger, Target and Walmart, are offering Thanksgiving meal bundles that cost about the same as last year. However, CNBC reported the Walmart bundle contains about 30 percent less product and that some brand-name products were substituted with private label products to keep costs lower.

The Associated Press contributed to this report.

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