HOUSTON — Before beginning an education on tariffs to a packed room at the 2025 Viva Fresh Expo, Texas International Produce Association President and CEO Dante Galeazzi started with a disclaimer that what he and Anne MacMillan, partner at Invariant Government Relations, planned to talk about was a fluid situation and subject to change at a moment’s notice.
“This administration is very challenging to predict,” MacMillan said. “I’ve been in Washington for a long time. Some things repeat themselves and some things don’t.”
Galeazzi started the conversation with the latest round of tariff news: a pause on additional tariffs for most countries outside of Canada and Mexico and an increase of 145% tariffs on China. MacMillan said the economic indicators likely drove the administration into its latest action. When asked if it’s likely the 90-day pause could end sooner, MacMillan said it would be unlikely.
“We have seen already a pretty substantial number of countries trying to engage in pretty significant negotiation deals,” she said. “I think there is forward progress on attempting to negotiate the proposed Liberation Day tariffs down to a more reasonable ending point.”
As for the 145% tariff on China, MacMillan said that’s another story. MacMillan said while it might be easy to dismiss the idea of using tariffs as a negotiating tool, the administration has strong concerns about the trade imbalances with its trading partners.
“We see this a lot with U.S.-produced products, particularly in the agricultural sector,” she said. “There’s tons and tons of particularly nontariff barriers that are raised very unfairly, particularly in the [European Union]. I do think that the president has raised these as very serious concerns, and he’s not taking no for an answer and that those [trade imbalances] need to be addressed.”
As for negotiating any trade imbalances, MacMillan said it will likely come down to what matters most for each country at the negotiating table.
“The president is very keen into trade imbalances, particularly the American trade imbalances,” she said.
However, many countries — such as Vietnam — have shown a willingness to negotiate very quickly, she said.
“If there’s positive developments from countries that go in the first round or the first tranche [of negotiations], I think that will signal to other countries that there’s this is a worthwhile endeavor to negotiate with this administration,” MacMillan said.
U.S. vs. Mexico and Canada
Galeazzi turned the conversation to the approaches by both Canadian Prime Minister Mark Carney and Mexican President Claudia Sheinbaum. While Sheinbaum has navigated working with the administration well, Canadians and Carney have taken a more hard-line response.
“From the way we are viewing it in Washington, [Sheinbaum has] done a very good job, and she seems to have the will of the Mexican government behind her,” MacMillan said. “I think she has really figured out how to put Mexico in a really positive light with this administration.”
MacMillan said it’s been a more difficult spot for Carney, though, with the anti-American product sentiment of Canadians.
“The Canadian ethos is that they’re upset with America,” she said. “There’s rumors out of the out of Canada that people are boycotting American products. I think he has been forced into taking a little bit more strident, stronger approach to President Trump, and I think that is showing that they have a more fractious relationship.”
MacMillan said the negotiating U.S.-Mexico-Canada Agreement is also part of the administration’s plan, calling the USMCA a major accomplishment for the previous Trump administration.
“We should be expecting a fairly robust renegotiation process,” she said.
MacMillan said it will be interesting to see the stance Canada and Mexico take through the negotiation given the two different sentiments of the countries.
“How do they continue to position and posture themselves throughout those conversations?” she said. “I think there were varying degrees of success in their home countries from the first USMCA, so it will be very interesting and something I’m watching closely.”
Likelihood of more reciprocal tariffs
As for more reciprocal tariffs from other countries, MacMillan said countries understand exactly what products to use as a tool to get grassroots engagement from U.S. citizens.
“Historically, they’ve always been very good at pinpointing what are our pain points,” she said. “We saw this immediately when the tariffs started coming out at these pretty high numbers; the EU and other places were immediately coming quickly with retribution against U.S. ag products.”
Future implications
In terms of the volume of bilateral trade agreements that would likely need to be put into order, MacMillan pointed to the volume of executive orders signed by the administration so quickly into the president’s second term.
“I actually feel that if the president wants to negotiate 190 different trade agreements, he will be able to accomplish that,” she said. “Now, they might not look like your traditional free trade agreements that I think we’re all used to, but they will look like enough to move forward.”
Galeazzi said he suspects the administration would choose a handful of countries to negotiate with, set the framework for a trade agreement and use those trade agreements as a blueprint for the rest of the countries.
During a Q&A portion of the session, an attendee asked MacMillan about how much of the tariff negotiation is political and how much is economical. MacMillan said it is an important part of the administration’s viewpoints on trade as a way to better the U.S. economy.
“You can quibble with the economic theory behind it, but I don’t think it’s all politics,” she said. “I think it’s a genuinely held economic concept that he has believed in since the early ’80s. There were and there are a lot of people in this country who have been negatively impacted by free trade, and there are towns that will never come back and there are manufacturing jobs that will never come back, and those people are still upset.”
As for whether there will be an exemption on food with tariffs, Galeazzi said he doesn’t see that happening.
“This goes off the rhetoric that we have seen right once they got egg prices down, the conversation from food moved away very, very quickly,” he said. “Now, egg prices have gone back up. Will [an exemption for food] come back up? Maybe, but I think it’s going to be very specific to eggs. I don’t think we are going to see an exemption for food come through. And again, this is just based on the rhetoric that the administration is looking for manufacturing jobs, and they are going to drive, or they are going to drive trade agreements that bring manufacturing are beneficial to more manufacturing investment in the United States.”
MacMillan said this is one part of the trade policy that needs more clarity since the U.S. imports foods such as mangoes and bananas that aren’t grown domestically and there may be challenges to lobbying tariffs against those products, especially as domestic demand continues to remain high.
When asked about the challenges the specialty crop industry faces when it comes to addressing the challenges tariffs present to lawmakers, MacMillan said the industry can often have conflicting opinions.
“The challenge with the produce industry with tariffs is that there may be winners and losers in every battle depending on the crop, the region, the history, etc,” she said. “Being able to articulate one point of view, with one voice, is what moves mountains in Washington. Generally, the diversity of the industry is your strength but in these scenarios, it could present more difficulty.”
Galeazzi shared that although there were payments for growers to offset the impact of tariffs in the previous administration, it’s much harder to calculate for specialty crop growers.
“For specialty crops we are often in the position that when help comes, we get the leftovers, because we are so many different commodities across such a small acreage, compared with cotton that’s a couple million acres here in the U.S.,” he said. “It’s easy to say here’s $1 per acre for every cotton grower and that should right them up, but it’s very different if avocados have an investment of $12,000 an acre and cabbage has an investment of $5,000 an acre. You basically need to pay specialty crops a different amount for each crop, and that gets really complicated.”
When asked for how to best advocate for the specialty crop industry in light of the tariffs, Galeazzi encouraged attendees to share their experiences with tariffs and what those mean. He gave an example of bananas, one of the most popular items in lunch boxes. Bananas were once a loss leader but now come in at about 68 cents a pound, which is roughly breakeven. Now, with an additional 10% tariff on banana imports, the average price for bananas will increase.
“That’s just if you have a pass-through of 10%,” he said. “That doesn’t include the additional operation expenses, the fact that you’re pretty soon going to have a port fee for boats that were built in China. Your expenses keep going up. The American grocery store is going to have to do something about bananas, which means the American consumer is going to pay more for bananas, which means kids are going to be impacted again. We need to be telling that story, because the U.S. consumer isn’t going to recognize that they paid 10 cents more for their banana. We need to tell them why that’s happened. That’s how I think we can be helpful.”
