Sandwiches, Fruit, Salads Among Menu Items Likely to Cost More
Delivering Tuesday on his campaign pledge to levy tariffs, President Donald Trump caused tremors across a huge swath of American industries that depend on goods from Canada, Mexico and China. Then he changed course on Thursday, pausing tariffs on many items from the North American nations until April 2. The on-again, off-again tariffs would have added, and still may add, 25% to the prices of all imports from Canada and Mexico.
Trump temporarily lifted tariffs on products covered by the U.S., Mexico, Canada Agreement (USMCA), which he had negotiated during his first administration. Those products include automobiles and auto parts; agricultural products and grocery items; manufactured goods such as electronics, machinery and consumer products; textiles and apparel; and chemical products. His doubling of tariffs on Chinese goods, to 20%, remains in effect.
Fast-food brands and their suppliers want to blunt price increases to consumers, but some appear to be unavoidable if tariffs return. National Restaurant Association CEO Michelle Korsmo sent a pleading letter to Trump in a failed attempt to exempt the industry. A 25% tariff on foods and beverages from Mexico and Canada would cost American restaurants more than $12 billion and would reduce the average small restaurant operator’s profits by 30%, Restaurant Business reported, citing the letter. In it, Korsmo also pointed out that restaurants “run on tight pre-tax margins that average 3% to 5% and they have, on average, 16 days cash on hand. Significant cost increases are not sustainable for most restaurants.”
Coffee and Avocados
One way companies have already prepared for tariffs was to build up inventories, a tactic of Westrock Coffee, which produces coffee for McDonald’s and Walmart. “We have a few million pounds of coffee that we get from Mexico,” Will Ford, Westrock’s chief operating officer, told The New York Times. Ford said the tariffs might push Westrock into sourcing beans from Honduras or Guatemala.
Of course, avocados don’t have the holding capability of coffee beans, and Americans get almost 90% of their avocados from Mexico, according to Eat This Not That. With Mexico dominating the market to that extent, the avocado has become the poster child for produce price hikes driven by tariffs.
Sysco, the giant global food distributor whose clients include restaurants, perfected the pivot to alternative providers when the pandemic dinged the supply chain. Of course, Mexico has cornered the market in avocados, which are perishable. “Can we today meet the full demand for avocados in the U.S.? No,” Victoria Gutierrez, Sysco’s chief marketing officer, told The New York Times. So if tariffs raise prices for those creamy green perishables – as well as limes, tomatoes and onions from Mexico – consumers or restaurants or both will have to swallow the higher cost.
Canada Foods, Steel, Aluminum
Canada-sourced food items are wide-ranging. “Canada provides a lot of beef, hogs and poultry, so we would see prices go up with all of those things,” Robert Handfield, a supply chain management professor at North Carolina State University told Nation’s Restaurant News. He noted that prices previously had been rising because of extreme weather and bird flu. Gutierrez said the U.S. imports wheat, frozen potato products and canola oil, so those imports could drive up fast-food menu prices for breads, cakes, French fries, tater tots, hash browns, breads, among other items.
Perhaps surprisingly, when Trump ordered a 25% tariff on steel and aluminum imports in February, that move also may elevate food prices. Why? Experts say those tariffs will raise the cost of items sold in steel and aluminum cans.
Drawing on articles from USA Today, Yahoo and Eat This Not That, here’s a look at more eats and drinks that would boost prices to customers and/or fast-food restaurants because of tariffs:
- Strawberries. About 85% of strawberries in the U.S. come from Mexico, according to the U.S. Department of Agriculture. (Yahoo reports that in 2023, Mexico produce made up 47% of all fruit imported into the United States.)
- Bell peppers. Mexico grows 76% of the bell peppers sold in the U.S., according to the USDA.
- Nuts, including peanuts, pistachios and walnuts. Mexico exported $7.76 billion in nuts to the United States in 2023.
- Beer. Mexico’s Modelo is the best-selling beer in the U.S.; a Corona six-pack might take a 45-cent price bump.
- Cooking oil from Mexico and Canada, upping the costs of fried foods.
- Fish/seafood, 79% of which is imported, according to NOAA Fisheries. This includes cod, tuna and snow crab.
- Maple syrup. Canada produces 71% of the world’s supply.
- Dairy. Canada exports dairy products to the U.S., including butter and cream. Most restaurants use domestic cheese, but tariffs could hammer pizzerias, in particular.
- Beef and meat-based menu items. Burgers and barbecue, for example, could have price hikes. Western Producer, a beef industry trade magazine, says 75% of Canada’s beef was exported to the United States in 2023.
- Tomatoes and tomato-based foods. U.S. restaurants and consumers rely on Mexico for tomatoes, which are consumed raw on sandwiches and in salads. They’re also the key ingredient in salsa, marinara sauce, ketchup and similar foods.
- Produce-laden foods such as fresh salads. Canada and Mexico boost U.S. supplies of various types of produce.
- Grain-based foods, including pasta. Canada exports wheat and other grains to its southern neighbor. Italian restaurants, bakeries and sandwich shops are vulnerable.
