Robert McMahon’s broccoli, beets and basil aren’t in jeopardy.
That’s because Southern Fresh Farms, a small agrotourism property in Fort Myers, will be insulated from tariff shock, according to co-owner McMahon. But he doubts that’s the case for others in the agricultural industry.
“Most everything we use is produced in the United States anyway,” he said. “So as far as this farm is concerned, the tariffs are gonna have zero effect on us.”
His counterparts in Florida and across the country don’t have the same assurance.
President Donald Trump’s administration slapped 25% tariffs on all Mexican and most Canadian imports March 4, with lighter burdens on Canadian energy products like crude oil and natural gas.
The administration then doubled the existing levy on China and is set to add 34%, so the effective tax will exceed 50%. China has already announced trade measures targeting United States agricultural products, including the multibillion-dollar soybean market.
China, Mexico and Canada are the top three destinations for nearly half of U.S. agricultural exports. Trade disruptions could increase domestic grocery prices, but those who grow the food will not gain any extra profits.
“You’re at the mercy of the markets,” McMahon said. “They’re not gonna give the farmer any more than the market will dictate anyway.”
Growers won’t go it alone. Economists suggest businesses and consumers nationwide will weather their share of turbulence.
Shifting sands
The Trump administration is wielding tariffs, or taxes on imports, as a weapon against nations it believes have “ripped off” the U.S. The tariff rollout has been less than smooth, marked by a series of announcements and subsequent reversals.
Trump delivered some clarity during his April 2 remarks on tariffs, vowing to impose a 10% tax on all imports and a range of more bruising levies on about 60 countries.
“We are essentially entering uncharted territory,” said Tobias Pfutze, an economics professor at Florida International University.
Elevated uncertainty can be a drag on investment, an engine of economic growth, Pfutze said. And as businesses reduce spending, the economy may stall. Policy whiplash has complicated business decisions like where to build factories and which suppliers to enlist, according to an Investopedia analysis.
The global investment bank Goldman Sachs recently raised its expectation for a forthcoming recession from about one in five to about one in three. J.P. Morgan’s forecast is a more dire 60%.
Before COVID-19, the last recession was in 2008, when the overvalued housing market imploded, sapping trillions of dollars in household wealth and toppling global banking institutions.
Pfutze said if the economy starts to tumble, however, it won’t be like the free fall of 2008.
“It would be a very different animal,” he said. “Right now I don't think it will be that profound, but I think it would still hurt.”
Trump said in a March joint address to Congress that levies will reinvigorate the domestic industrial base and “make America rich again.”
Sean Ehrlich, who researches trade policy at Florida State University, doubts that’s feasible in the near term.
During America’s manufacturing heyday, from the mid-1940s into the late 1970s, the U.S. was a leader in vehicle, aircraft and steel production. Then, as Americans adopted an appetite for cheaper goods, the industrial boom sputtered and jobs moved abroad.
“The tariffs, even if they did restore the U.S. manufacturing sector to what it was 30, 40 years ago, it won't lead to the same number of manufacturing jobs as we had,” Ehrlich said. “There are industries that just aren't going to come back to the United States no matter what.”
Meanwhile, the levies will make it too expensive for some foreign companies to send their goods to the U.S., and for Americans to buy them. Canada, Europe and China, among others, have pledged retaliation by implementing tariffs of their own.
Automakers face new roadblock
Americans whose cars have kicked the can may be in for a world of hurt.
Trump supports taxing foreign car parts to force manufacturers to set up shop in the U.S, creating jobs and encouraging consumers to buy domestic vehicles. But there’s no all-American car.
The North American automobile industry relies on a network of interlocked supply chains. Vehicles sold in the U.S. snake through Canada, Mexico and back to the U.S. several times before reaching retail lots.
Florida has no large-scale automobile manufacturing plants but boasts over 850 franchised car dealerships. The state’s retailers will soon contend with the 25% tariff on imported vehicles, enacted April 3. The tax will apply to imported auto parts starting May 3.
Disentangling American car companies from their trading partners would be a yearslong — and likely futile — effort, according to Russell Triplett, an associate professor of economics at the University of North Florida.
“The motivation for building these supply chains in their current form was in the pursuit of lower costs,” Triplett said. “Disrupting those supply chains [will] undermine that pursuit of low-cost production, and it’s gonna be reflected in price.”
Certain cars generate greater profit than others because margins — or revenue after costs — on sales vary. As tariffs take hold, manufacturers will have to decide which models are still worth assembling. That could narrow the range of vehicles available to Americans and increase prices, Triplett said.
The duties could make cars more expensive by thousands each, potentially generating more demand for used vehicles, undermining Trump’s goal of boosting new car sales from U.S. manufacturing plants.
“Maybe [consumers will] ratchet down,” Triplett said. “[They may think] ‘Those new car prices — they're outrageous.’”
Affordable housing at stake
It may also become more difficult for Floridians to nab a new home.
Contractors expected normal market conditions in 2025 to inflate the cost of building materials by about 3% but recently adjusted the figure to 10%, anticipating pressure from tariffs, a representative from a real estate consultancy told CNBC last month.
Domestic production can’t fulfill the industry’s needs. The U.S. imports most of its lumber from Canada and most of its gypsum, a mineral used in drywall, from Spain and Mexico.
While there are new exemptions for some materials from Canada and Mexico, other construction components in the line of tariff fire – like steel, aluminum and copper – could push housing costs higher.
One forecast predicts home values could surge as much as $22,000 in the next 12 months, which could price hundreds of thousands of Americans out of the market.
Meanwhile, the mortgage interest rate, although falling, remains high. Federal data show the most popular offering, a 30-year fixed-rate mortgage, has climbed from around 2.67% in 2020 to its current rate of 6.64%.
America’s affordable housing crunch predated Trump’s second term, and the disruptions that sent home prices soaring during the pandemic still haunt the industry.
As of February, the median home sale in Florida was more than $400,000, according to the real estate company Redfin.
“If we already have a housing shortage, [and] we're increasing the cost of housing, we're not solving a problem,” said Annamaria Long, executive officer of the Flagler Home Builders Association.
Prospective buyers and builders aren’t the only consumers left vulnerable. Long said existing homeowners will have to grapple with rising costs on interior essentials.
Household appliances from South Korean brands Samsung and LG are now subject to a 25% levy.
“If you need to replace your air conditioning, your roof, your fence, your refrigerator, your microwave, you will be affected,” Long said.
Contact Natalie Kaufman at nkaufman@alligator.org. Follow her on X @Nat_Kauf.
Natalie Kaufman is the business enterprise reporter and a second-year journalism major. Outside the newsroom, you'll catch her drinking too much caffeine and running.
