business

Cheese Could Be Latest Casualty of U.S.-EU Trade Battle

While eyes are turned toward ongoing trade tensions with China, the Trump administration is also weighing tariffs on a slew of European consumer goods, including duties on some cheeses that could reach as high as 100 percent.
That has understandably left importers nervous.
And the proposed duties aren’t really about cheese. They’re about airplanes.
For more than a decade, the U.S. and the European Union have been tangled in a bitter dispute at the World Trade Organization over subsidies granted to European aircraft manufacturers (namely, Netherlands-based Airbus). U.S. officials argue that financial assistance has unfairly hurt American aircraft manufacturers, primarily Boeing.
As a retaliatory measure, the U.S. Trade Representative is now considering imposing duties on European products — including cheese.
“You kind of wonder why a dispute between two aerospace [companies] gets involved with cheese. A 100 percent tariff on cheese — imported cheese — there’s roughly $1 billion of EU cheeses that are on this list that are coming into the U.S. now,” the president of the Cheese Importers Association of America, Philip Marfuggi, told Cheddar. “That relates to over $300 billion of revenue generated by U.S. companies in the U.S. economy.”
Marfuggi heads the Ambriola Company, a New Jersey-based cheese importer that primarily sells Italian cheeses. “I’m not going to bring the cheese in if I can’t sell it,” he said, explaining that the tariffs could double the cost of some cheeses.
On August 5, the Cheese Importers Association told its members that tariffs on imported cheeses will result in financial burdens throughout the industry and job loss, noting that “[t]he sale of EU cheeses supports not just employees of cheese importing companies, but also many jobs throughout the entire U.S. cheese supply chain, including freight forwarders, truck drivers, cheese processing companies, and food retail and restaurant workers.”
The co-owner of Austin-based cheese seller Antonelli’s Cheese, John Antonelli, warned that the tariffs could put him out of business. “We immediately become at risk of going out of business, which then, therefore, punishes the small cheese makers that really rely on us here, locally, to get their product to market,” he told Texas NBC-affiliate KXAN.
"We have lived through a very long stretch of relatively smooth importing and these tariff threats have heightened the awareness that imports are subject to political pressures,” said Steve Millard, the senior vice president of merchandising and operations at New York-based Murray’s Cheese, said in a statement to Cheddar.
“With these tariff threats in mind, it is not entirely clear there is enough U.S. cheese production to meet the demand that this may result in. It is also not clear if the consumer will readily switch to a domestic cheese or just reduce or eliminate consumption of some cheeses,” he added.
That sentiment has been echoed by Phil Kafarakis, president of the Specialty Food Association, who has urged the U.S. trade representative to remove agricultural products from tariff considerations. “The proposed increased duties on specialty food products will have an adverse effect on U.S. small food businesses, decreasing sales and adversely affecting employment. There are few to no domestic products that can replace these imported specialty foods,” Kafarakis said in a statement to Cheddar.
Millard explained that the categories of cheese the company imports are not easily replaceable, as they’re governed by “destination of origin” laws that protect regional foods in Europe.
The National Milk Producers Federation, an organization that lobbies on behalf of U.S. dairy farmers, supports the proposed tariffs, pointing to those very limitations as a key factor in the U.S. dairy trade deficit with the European Union.
“Simply put, we are largely being blocked from the EU market despite being a trusted and proven dairy supplier to the rest of the world,” said National Milk Producers Federation President and CEO Jim Mulhern in a May testimony to the USTR.
“As part of its trade agreement negotiations, the EU pressures trading partners to prevent all producers other than those EU producers in certain EU regions, from using certain product names, such as fontina, gorgonzola, asiago, or feta, even though they are the common names for products, and the products are produced in countries around the world,” the USTR noted in a 2019 report.
That ruling means that American cheese producer can’t call their cheese fontina — or “fontina-style” — even if it’s made the same way as fontina produced in Europe.
Of course, European cheeses aren’t the only products on the tariff chopping block. Also at risk: olive oil, whiskey, and scores of other favorites from across the Atlantic.
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