In a recent announcement, President Donald Trump declared sweeping tariffs on various countries, labeling groceries as an “old-fashioned” and “beautiful term.” However, industry experts and supermarket executives anticipate that these policies will lead to increased grocery prices for American consumers. The implication of these tariffs raises critical concerns regarding the affordability and accessibility of food across the nation.
Supermarkets today offer a diverse range of imported items, ranging from fresh produce to packaged food and essential household goods. With a 10% tariff implemented on all countries on Saturday and even higher reciprocal tariffs on 60 countries and trading blocs, U.S. businesses that import goods are immediately impacted. These businesses will inevitably bear the brunt of the tariffs, resulting in increased prices that will be passed on to consumers at grocery stores nationwide.
The types of products expected to see a price increase include essentials such as seafood, coffee, fruits, cheese, nuts, and candy bars. Experts also highlight that items requiring imported ingredients and packaging materials, specifically plastic and aluminum, will also experience price adjustments. Perishable goods are likely to see the first rise in costs, followed closely by shelf-stable items. As companies resort to shrinking product sizes—a phenomenon known as shrinkflation—it is plausible that shoppers will notice a reduced quantity of products for the same price. Moreover, certain variations of goods may even be eliminated as companies endeavor to counteract cost hikes caused by the tariffs.
John Ross, CEO of IGA, an independent grocery chain, warned residents that grocery prices will begin to rise “in the next couple of weeks,” with significant visibility expected across stores within the next 90 days. According to estimates from Yale University’s Budget Lab, the overall food prices may increase by approximately 2.8%, which includes a notable 4% hike for fresh produce. These shifts will disproportionately burden low-income shoppers, who allocate a larger share of their income towards essential goods.
The extent to which grocery prices will fluctuate is also tied to the size of the grocery retailers involved. Smaller grocers may experience faster price increases due to their limited ability to absorb additional costs compared to larger chains such as Walmart or Costco. Major suppliers like Campbell and Kraft Heinz possess more flexibility to navigate tariff impacts than smaller companies, although it’s expected that minimal businesses will escape the repercussions entirely.
Steve Schwartz, the director of sales and marketing at Morton Williams grocery chain, indicated that small distributors tend to respond swiftly to rising costs. With limited inventories, small distributors raise prices quicker than larger enterprises, who can postpone adjustments until depleting their stockpiles. For instance, an Italian importer supplying Morton Williams informed the company about an impending 20% spike in prices for olive oil and balsamic vinegar scheduled for next month.
Randy Arceneaux, CEO of Affiliated Foods—a wholesaler servicing about 700 independent grocery stores across eight states—shared insights that suppliers are largely in a wait-and-see phase relating to tariffs. Nonetheless, several have already communicated price increases for items, including bananas and canned tuna, as well as plastic utensils due to the tariffs. Specifically, a 10% tariff imposed on bananas sourced from Guatemala will raise the costs by 4 cents per case, translating to a heightened cost that will ultimately be borne by consumers.
Moreover, American food supply chains are deeply intertwined with global markets, especially for products that are not feasible to grow domestically. Imported food items—representing approximately 17% of overall food consumed in the U.S.—are expected to witness significant price hikes under the current tariff conditions. Categories such as seafood, coffee, fresh fruit, and vegetables disproportionately rely on imports, involving 80%, 80%, 59%, and 35% respectively, per Department of Agriculture statistics.
Leslie Sarasin, president of food industry group FMI, stated that our food system’s connection to global markets crucially maintains accessible prices for nutritious food year-round. Importantly, the effects of these tariffs may be somewhat mitigated by the exemption of Mexico and Canada from Trump’s tariffs, as these nations represent the largest agricultural suppliers to the United States.
Prior to these tariff implementations, grocery prices had already escalated, with a reported overall increase of about 23% since 2021. This inflation has hurt sales figures for various brands, including PepsiCo, Campbell, and JM Smucker. Notably, the shift in consumer behavior towards fewer snack purchases is evident, as discussed by PepsiCo. Such trends signal a larger pattern of reduced discretionary spending among shoppers, with more consumers opting for value-centric options such as private-label brands, reflecting a more cautious approach to spending in today’s economic environment.
Overall, the cascading effects of tariffs on grocery prices demand increased vigilance from consumers and the food industry alike. Understanding the interplay between global supply chains and local markets is vital as we navigate potential challenges in food affordability in the coming months.