Make chocolate great again? Trump’s tariffs are harming US chocolate firms in one unfortunate way

Things are far from sweet for American chocolatiers right now, as despite US president Donald Trump harping on about ‘America First’, rival companies in Canada and Mexico are enjoying producing chocolate duty-free, while US firms are having to contend with the Republican’s global tariffs which triggered economic chaos when they were first unveiled earlier this year.

Let’s talk making chocolate. Thanks to the US-Mexico-Canada agreement negotiated by the first Trump administration – which came into effect in July 2020 – Canada and Mexico can export their finished chocolate to US companies without said companies paying any tariffs.

The cocoa needed to make that chocolate can be brought into Canada without Canadian businesses having to pay any tariffs to do so.

Mexico, meanwhile, produces its own cocoa beans, so there’s no issues there.

Compare that to US chocolate makers, and if they want to make it in America first (to reference Trump’s slogan), then they’re in a spot of bother, because they’ll need to source the cocoa beans from elsewhere, and that comes with a fee on imports thanks to Trump’s global tariffs first set out on April’s “Liberation Day”.

Take Taza Chocolate of Massachusetts. The company’s CEO Alex Whitmore told Reuters it had to pay more than $24,000 in May for cocoa from Haiti, and is now looking at a $30,000 duty to receive cocoa from the Dominican Republic – both countries being affected by Trump’s global tariffs.

Whitmore said: “For a company our size, that's our profit margin gone, so the immediate thought is, ‘OK, the rules have changed, we just need to create the most cost-effective solution for the consumer’.”

Meanwhile US chocolate giant Hershey, which has plants in Canada and Mexico, told the outlet it estimates a $100 million hit in tariffs in the third and fourth quarters of the financial year if current fees remain in place.

And in remarks which likely won’t please Trump, given his US focus, Paolo Quadrini of the Mexican chocolate and sweet association Aschoco Confimex has said American tariffs are “creating new opportunities for Mexican companies”.

Awkward.

An official from Trump’s administration told Reuters that it continues to monitor market trends and listen to feedback from the industry when it comes to delivering the president’s plan for the economy.

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