URUAPAN, Mexico (AP) 鈥� Mexicans are worried that could affect a wide range of iconic Mexican products and threaten entire regional economies.
In western Mexico, as avocados. But avocado growers, pickers and packers worry that U.S. consumers, faced with 25% higher prices, may just skip the guacamole.
鈥淚 think that when there is an increase in the price for any product, demand declines,鈥� said avocado grower Enrique Espinoza. Orchards like his are the economic lifeblood in the western Mexico state of Michoacan. 鈥淚t would be a tragedy if they closed down (the border) on us,鈥� he said.
Trump’s Jan. 20 inauguration 鈥� when he said he would impose tariffs 鈥� couldn’t come at a worse time: It’s around when Mexico starts shipping crates of the green fruit north for
Jos茅 Luis Arroyo Sandoval, a manager at an avocado packing house in Michoacan, says the economy would be affected.
鈥淲ork for us could decrease because it won’t be quite so attractive to export,” Arroyo said, 鈥渂ecause avocados would get expensive, and avocados are already expensive.鈥�
It may not just be Mexican producers who are affected; U.S. consumers may also be howling.
Mexican business leader Gina Diez Barroso told a news conference Tuesday that one U.S. agriculture official told her he had never had as many complaints as when in 2022.
鈥淣ever in his life had he had so much chaos in his office, because they halted Mexican avocados,鈥� Diez Barroso said.
Espinoza agrees that consumers are likely to share the pain.
鈥淭he gringos need avocados, it is a good product, and I don’t think they are going to stop consuming it,鈥� he said.
Rather, the reverse effect has him worried; as President Claudia Sheinbaum has suggested, Mexicans will face not just a drop in income, but high prices for U.S. products like corn, which is a main supply of feed for animals in Mexico.
鈥淭here are more poor people here, so in some ways it is going to hit us,鈥� Espinoza said. 鈥淭he United States can pay 25% more for Mexican products, very few of us have enough money to pay 25% more for what we import from the United States.鈥�
It鈥檚 not just the guacamole; In 2023, the U.S. imported $4.6 billion worth of tequila and $108 million worth of mezcal from Mexico.
That has raised cautious concern among tequila producers, including farmers who grow agave on some of the driest, marginal soils that couldn鈥檛 support many other crops.
鈥淲e are analyzing the statements by the authorities and their reactions, and in the coming days we will establish a position,鈥� the National Tequila Industry Chamber said in a statement.
And industry representatives say a drop in the consumption of tequila 鈥� America鈥檚 third-most popular spirit, behind vodka and pre-mixed cocktails 鈥� could affect U.S. bars, restaurants and clubs.
鈥淎t the end of the day, tariffs on spirits products from our neighbors to the north and south are going to hurt U.S. consumers and lead to job losses across the U.S. hospitality industry just as these businesses continue their long recovery from the pandemic,鈥� the Distilled Spirits Council of the U.S. said in a statement.
The tariffs would probably plunge Mexico into an immediate recession. Mexican financial group Banco Base estimated in a report that for every 1% that Mexican exports increase in price, their volume falls by 1.33%
Supposing that Americans might absorb half the impact of the tariffs and just pay higher prices for Mexican goods, they still might reduce their consumption by 12%, Banco Base estimated.
鈥淭his would be reflected in a 4.4% drop in gross domestic product,鈥� the bank wrote, adding 鈥渢he decline would not just occur in 2025, but would get more serious the longer the tariffs last.鈥�
And the tariffs could affect some products that aren鈥檛 thought of as particularly Mexican at all.
Mexico鈥檚 Economy Secretary, Marcelo Ebrard, said Wednesday that 88% percent of come from Mexico, though it was unclear if he meant just parts of the trucks or their final assembly.
Ebrard claimed that 25% tariffs would mean U.S. consumers might have to pay $3,000 more per pickup truck.
鈥淚t is shooting yourself in the foot,” Ebrard said.
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