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Food economist warns tariffs are pushing prices higher as Trump targets price fixing
A food economist says the current tariff environment has been one of the most disruptive events to global food supply chains since COVID.
David Ortega with Michigan State University says tariffs are increasing food costs for consumers by raising prices throughout the supply chain and compounding inflationary pressures.
“As far as we can see from the data on the agricultural and food sector, we haven’t seen any materialized benefits from the tariffs because they’re creating a great deal of uncertainty at the moment that are affecting our businesses, our farmers, as well as our consumers,” he explains.
Ortega says the recent uptick in the rate of cost increases is likely the direct result of tariffs.
“It takes time for these costs to make their way down the supply chain, so their effects are only just being seen on retail prices,” he says.
He says coffee and bananas are prime examples. USDA expects food prices to rise about three percent in 2025.
Plans include creating Food Supply Chain Security Task Forces at the Department of Justice and Federal Trade Commission to investigate price-fixing. The White House says without aggressive enforcement, price-fixing and anti-competitive behavior will continue to inflate grocery prices.
Ortega says efforts to lower food costs don’t lead to sudden price decreases, if there are any at all. In the last 25 years, he says it’s only happened twice and only briefly.
Ortega gave testimony on his research as part of a Michigan Senate committee hearing this week.
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