Analysis Milk
Trump may hit dairy exports but not break them
Barking dogs never bite, but in the person of Donald Trump this is somewhat more nuanced. The American president is certain to introduce import duties of up to 25% on European goods. Although Europe intends to retaliate in kind, this could have quite far-reaching consequences for agricultural exports. A substantial part of European dairy exports cross the pond, but the American market is not crucial. On paper, the European export interest in butter is greater than that of cheese, at least in volume. A data analysis on the possible impact.
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Choose the subscription that suits youIn addition, it is obvious that dairy will be taxed again, just like olives and whisky. During Trump's first term, he already imposed tariffs on these European goods. At that time, he also threatened tariffs on Dutch Gouda and Edam, but later these products were exempted. Parmesan cheese, for example, was affected then, which mainly affected Italy.
€120 million Dutch export value
Last year, the US imported 141.734 tonnes of cheese from the EU, a record volume. This brought in just under €850 million. Compared to the total cheese export on the world market, this is around 10%. The Netherlands sold around 18.500 tonnes to the US with an export value of €120 million, according to figures from Eurostat. This makes the US a grateful, but not crucial sales market for our dairy sector. The Dutch cheese trade and cheese industry are therefore reacting cautiously to the 'tough talk' from Washington, as companies say informally. There is simply too little known yet. Incidentally, foil cheese is already taxed. Within the quota, this is a levy of 10%, above that a higher rate applies.
Importance of butter is greater
During Trump’s first term, European butter was also subject to additional taxes. The export importance of butter is greater in volume than that of cheese. Of the 2024 tonnes exported in 246.000, almost a quarter (65.000 tonnes) went to the US. The American share generated a tidy €550 million, the vast majority of which was collected by Irish processors. The Netherlands hardly exports any butter to the US. Of the total butter production in Europe, only slightly more than 10% is traded outside the EU. On balance, the export importance on the American market is therefore fairly limited. Nevertheless, the tariffs can influence sentiment on the European market.
Rabobank expects the tariffs to have an 'average impact' on dairy. The European agricultural machinery sector is the most vulnerable, according to the lender. The tariffs are expected to have a low impact on European exports of sugar and animal proteins such as meat.