Second EU Retaliation Package Would Hit More Than $7 Billion in Ag Exports

A second tranche of retaliatory tariffs under consideration by the European Union would hit more than $7 billion in annual U.S. ag exports, according to a copy of a list obtained by Agri-Pulse.

EU officials are working to finalize the bloc’s plans to hit the U.S. with retaliatory tariffs should negotiations with Washington fail and President Donald Trump proceeds with threats to hike duties on EU exports on Aug. 1.

Policymakers approved retaliatory tariffs on an earlier list of products worth more than $25 billion in March. Agricultural products featured prominently in that list include grains, meats and vegetables. Those countermeasures were set to take effect earlier this week but were postponed until Aug. 1 to let discussions play out.

A second list currently under consideration would levy tariffs on a further $84 billion of U.S. products, including around $7.4 billion in agri-food exports.

Fruit and vegetables make up the largest share of the agricultural products under consideration, at more than $2 billion in annual exports. Wine, beer and other alcoholic beverages account for a further $1.4 billion, while fish and seafood, animal products and tobacco make up around $600 million, $340 million and $130 million, respectively. The list is wide-ranging, hitting a variety of U.S. meat exports, nuts, dried and fresh fruits and vegetables, seafood, mushrooms and bourbon.

Aside from U.S. agricultural products, the list includes a slate of U.S. industrial products, including Boeing planes, cars, medical devices and chemicals.

The list went to member states on Monday for review, European Commission trade spokesperson Olof Gill told reporters during a daily press conference on Tuesday. The member states will have to sign off on the countermeasures before the list is finalized and the tariffs can be adopted. 

Gill stressed again that the commission does not intend to impose any countermeasures before Aug. 1. But many European policymakers, including French President Emmanuel Macron, have been urging the administration to accelerate retaliation preparations following Trump’s fresh tariff threat on Saturday.

Former EU Trade Commissioner Cecilia Malmström told Agri-Pulse earlier this week that she expects the European Commission will have both packages ready to take effect should negotiations breakdown before Aug. 1.

“The commission has been given the mandate to use them,” Malmström said.

The EU is currently subject to the president’s 10% baseline tariff, while its steel and aluminum exports face 50% tariffs and its vehicles are subject to a 25% duty. The bloc could also face additional duties if investigations into pharmaceuticals, commercial aircraft and other sectors result in new duties or the president makes good on his threat to sanction economies trading with Russia.

The commission’s second tariff list is retaliation for only the reciprocal tariffs, increased steel and aluminum duties and car tariffs. An earlier version of the list had proposed hitting $110 billion of U.S. exports, but the commission pared the proposal to the $84 billion sent to member states this week following input from member states and industry.

Notably, EU agricultural industries have been pressing the commission to avoid targeting U.S. agriculture as part of its retaliation plans over concerns that it could further embroil the sector in an escalating trade war.

Even as the EU prepares retaliatory measures, officials insist that they would prefer a negotiated solution and remain committed to ongoing trade talks. Technical discussions on a potential deal are continuing in Washington this week.

At the political level, Trade Commissioner Maroš Šefčovič spoke with Commerce Secretary Howard Lutnick on Monday and U.S. Trade Representative Jamieson Greer on Tuesday, Gill said.

“We are in the most sensitive stage of those negotiations right now,” Gill said on Tuesday, adding that both sides are “working towards getting an agreement in principle over the line before the deadline set by the U.S.”

This article was originally published by Agri-Pulse. Agri-Pulse is a trusted source in Washington, D.C., with the largest editorial team focused on food and farm policy coverage.