Lions, Tigers, and Tariffs, oh my!
Lions, Tigers, and Tariffs, oh my!
*Important Update: As of Wednesday, Feb 26th, the 25% tariff on Mexican and Canadian imports has been delayed to April 2nd, 2025, with an additional announcement of intended tariffs of 25% on goods imported from the EU.
Tariffs—one of the many hot button words we’ve seen in headlines the last few weeks. But how would a 25% tariff on Canadian or Mexican imports impact the horse industry? Or a 10% tariff on Chinese imports? And are they even going to happen?
The current facts: In the flurry of federal administrative decisions since his inauguration, President Trump signed three executive orders imposing new tariffs on imports from Mexico, Canada, and China slated to go into effect February 4th, 2025. On February 3rd, President Trump agreed to suspend the tariffs against Mexico and Canada by one month after negotiations. The Chinese tariffs went forward and are currently in effect. This is inclusive of products (and horses) imported from Hong Kong.
So what does this mean for businesses in the horse industry that import products and horses? And what does this mean for horse owners and enthusiasts?
In regard to the Chinese tariffs, many products, such as riding clothes, saddles, boots, horse blankets, etc., are manufactured in China to be sold in the United States. Businesses are now paying the 10% duty tax on those imports, and if you’re a horse owner or enthusiast, you’re seeing that new cost in an increase in product pricing.
The current delay on the Canadian and Mexican tariffs is until March 4th, 2025. If the tariffs are imposed on March 4th, businesses could expect the 25% duty tax to go into effect on any items imported from Canada and Mexico. This includes hay, feed, ingredients for feed production, trucks and trailers, steel and aluminum for construction and vehicle production, wood shavings and wood pellets, lumber for barn construction, and more.
Let’s use imported hay as an example. Why are we importing so much hay anyway? As the US has grown and rural areas have become more developed, combined with a changing climate impacting growing seasons, we’ve lost significant production capacity for hay while seeing an increase in demand for feeding livestock. 2022 saw the lowest hay crop in the US since 1974. This means if we want enough hay to feed our livestock, we need to import some. If that flow of imported hay stops, we don’t have the ability to meet that capacity, at least in the short term, and we would likely see a dramatic rise in hay prices as well as a very serious hay shortage.
If the generalized 25% tariff goes through, you could expect prices on imported items from Canada and Mexico to increase by at least 25%. On top of that, importers and businesses may choose to discontinue items all together that they don’t feel are worth the new sale price to consumers, especially if those items aren’t produced in the US. Overall, we would see significant price increases related to all aspects of horse ownership, from grain and feed to barn construction to the cost of diesel for our trucks. The cost of everyday care for our horses would increase rapidly. And that doesn’t even factor into our competition and recreation activities.
So what can businesses and horse owners do? As with anything, call your congressional representatives, both in the House and the Senate. Get loud; let them know how this would impact your life. Members of Congress don’t quite tend to understand how well represented the horse industry is in their districts, and it’s up to you to let them know.
Here at the American Horse Council, we’ll keep doing our part to get the message out to federal agencies and legislators, but your voice is equally as impactful. Feel free to reach out to us at info@horsecouncil.org with your legislative and regulatory questions.