Trump tariff exemptions leave local growers exposed to competition from imports

When President Donald Trump announced sweeping tariffs on the United States’ largest trading partners, he promised to “make America wealthy again.” The philosophy behind the administration’s tariffs, Trump and his advisors have said, is to generate revenues from imports and increase competition between American and foreign companies.

“American steel workers, auto workers, farm workers and skilled craftsmen — they really suffered gravely,” Trump said on April 2 during a press conference announcing tariffs. “They watched in anguish as foreign leaders have stolen our jobs, foreign cheaters have ransacked our factories and foreign scavengers have torn apart our once beautiful American dream.” 

Since Trump entered office, tariffs have been announced, imposed, delayed and changed in a flurry of executive actions. But North Fork farmers — who said they would welcome tariffs to make their goods competitive — have been left out, as Trump exempted most agricultural products from his tariffs on two of America’s largest trading partners: Canada and Mexico.

“I feel like that would actually be appropriate, because it’s a food security issue and it’s a fairness issue,” Eve Kaplan-Walbrecht, who owns Garden of Eve Organic Farm in Riverhead, said of tariffs on agricultural products. 

Trump announced 25% tariffs imported from Mexico and Canada during his inaugural address, accusing the countries of not doing enough to curb the flow of drugs and migrants into the U.S. Those tariffs were delayed for 30 days, and later implemented with exemptions on goods under the United States — Mexico — Canada Agreement (USMCA), the pact which removes trade barriers on agricultural products and other goods. 

When the United States, Canada and Mexico signed the USMCA’s predecessor, the North American Free Trade Agreement (NAFTA) in 1994, Riverhead farmer Phil Schmitt of Schmitt Farms “didn’t really think too much of it.”

In reality, the agreement allowed supermarkets to import heavily subsidized vegetables from Canada into the United States at lower prices, effectively cutting Schmitt and other local growers on the North Fork out of the market, he said. NAFTA was terminated by the Trump administration in 2020 and replaced with the USMCA, which also exempted agricultural products from tariffs. 

“I’m more than happy to compete with the Canadian farmers again. I know some of them,” Schmitt said. “I’d hate to see them get hurt, but when they’ve been averaging for the last 20 years 30% to 35% more [revenue] than I can get, I can’t compete with them.”

For the biggest agriculture producers in the U.S., free trade agreements have been fruitful, growing the industry’s revenues by more than $200 billion — or roughly 64% — from 1994 to 2022. The big agricultural exports of the U.S. — soybeans, wheat, rice, field corn and meats — receive the most support from the United States Department of Agriculture, primarily via subsidies in the annual Farm Bill. “Specialty crops” like those grown on Long Island — fruits, vegetables, sweet corn, flowers and sod among them — receive few direct subsidies. 

Canada and Mexico together export the most agricultural products into the U.S., accounting for almost 60% of all agricultural sales between 2020 and 2024, according to the USDA’s Economic Research Service. A lot of those imports are specialty crops.

Both countries also have favorable exchange rates to the U.S. dollar — making imports cheaper and hurting their domestic competition.

“The exchange rate on the dollar… it kills us,” Schmitt said. 

The competition for specialty crops is “very unfair,” Schmitt said. It’s hard to sell crops like cabbage and lettuce wholesale to local supermarkets, Schmitt said; even when many supermarkets want local products, they often don’t want to pay more, he said. 

That’s why many local farms sell their products at local farm stands. “I try to grow just what I can sell locally,” Schmitt said. 

“I’ve avoided the…agritainment business,” Schmitt said, referring to the use of farms as tourist attractions. “I really don’t want to do it. That’s what a lot of guys have turned to… to subsidize the bad habit of farming, I guess.”

Another factor: the cost of labor. 

Kaplan-Walbrecht said, “If people want to support workers rights, they should support” the tariffs, because they level the playing field. There are “tremendous demands being put on us in the name of equity and fairness and human rights — and yet consumers are not voting with their dollars,” she said.

“People say they want a living wage for Americans, and we pay that living wage,” Kaplan-Walbrecht said. “And yet, consumers are buying much cheaper produce that’s grown in places that are not paying people a living wage, not giving them any kind of protection at work, not providing any of the things that we’re required to provide — both by New York State and by the federal government.”

Kaplan-Walbrecht and Schmitt said they don’t want government subsidies — just a chance to compete with other farmers. 

“We just want to run a business that’s successful, just like everyone else who runs a small business,” Kaplan-Walbrecht said.

Another key part of the North Fork’s agricultural industry is wine and vineyards. Riverhead winemaker Juan Micieli-Martinez said tariffs could have benefits to domestic manufacturing in the industry. The general manager of Premium Wine Group in Mattituck, Micieli-Martinez said the winemaking and packaging business has already seen an uptick in manufacturing inquiries. 

“But,” he added. “If you were not already in manufacturing and you’re thinking about investing in manufacturing, I think that becomes more questionable. Do you go out and build something? That seems, like, a little bit riskier to me.”

The tariffs could also affect the price of the bottles used to package wine and craft beverages. 

“I have to imagine domestic glass producers are probably getting a lot of inquiries now as well,” Micieli-Martinez said. “It’s just a matter of, can they keep up with capacity? That becomes the question. And where do the raw goods, the supplies come from to manufacture?”

Overall, “I don’t see how it couldn’t” lead to the increased price of wine, Micieli-Martinez said. “As a producer, you can tolerate certain amounts of increases in your production costs without maybe raising a price — if you want to really try and keep prices competitive.”

“But I don’t think you’re going to have much of a choice long term if things go up as much as they’re being proposed,” he added.

Micieli-Martinez, who is also the president of the Long Island Farm Bureau, said he still expects the agritourism industry on eastern Long Island to remain strong as the effects of tariffs settle. While some people may end up spending less, people “still need to get out,” he said, and the North Fork’s farms and vineyards are just “a drive away” for a lot of people.  

But if the economy hits the point of a recession — meaning people are spending less and saving more — “that’ll change things considerably,” he said.

The erratic politics surrounding Trump’s tariff policies also worry Micieli-Martinez from a business standpoint. 

“How does somebody make a forecast on what’s going to happen in the next six months [or] a year?” he said. “I just hope that this is not an indication of the next four years. I just wish we would establish what we’re going to do and kind of somewhat stay on a path, because things are changing day to day, hour to hour. I mean, it’s certainly more challenging in a business environment to kind of manage those constant changes.”

For Schmitt, he said his farm’s business is “proceeding as usual,” with the hope that the government might renegotiate the trade agreements to his benefit. 

“They gotta do something for us,” he said.