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US president Donald Trump has announced that he will set tariffs of 20% on exports from the EU. This gives a clearer but not more favourable picture for Malaga's exporters of olives and olive oil, among other products, who have been fearing the tightening of these economic measures since Trump came back to power. Already during his previous term, the US president had imposed tariffs on table olives, but with this mandate he has promised to make the situation more difficult for exporters on a global level.
How will domestic economies and specifically that of Malaga province be affected?
The president of the agricultural employers' association (Asaja Málaga), Baldomero Bellido, said that Spain already had a bad experience with Trump's first mandate, when the Republican imposed tariffs on Spanish black table olives and olive oil, while countries such as Portugal, Italy and Greece were spared.
"The one on olive oil was removed when Biden arrived, but the one on table olives persisted, despite the fact that it has been declared illegitimate by the World Trade Organization. It is easy to impose a tariff, but removing it is complicated," Bellido said, adding that agricultural products are a particularly "weak link" in international trade, as farmers and distributors of agricultural production are "the ones who pay for trade wars when they are launched in relation to other issues".
The US is currently the fourth largest destination for Malaga exports after France, Italy and Portugal. Between January and November 2024 (December is not yet included in the statistics), the 705 companies in the province that carried out commercial operations with the overseas country totalled sales worth 292 million euros, which represents a 30.7% increase compared to the entire financial period of 2023. This large figure is almost 80% concentrated in a single product: olive oil. It is precisely the increase in production this past olive growing season that is the cause of the sharp rise in exports to the US in 2024: olive oil has gone from generating 168 million euros to 225 million euros.
In an extraordinary turn of events, Spain dethroned Italy as the biggest exporter of olive oil to the US two years ago. It was quite an achievement, bearing in mind that Italy is the country that Americans have linked to the liquid gold in their collective imagination. The growth of overseas Spanish olive oil sales has been spectacular in recent years and a large part of the success is attributed to a Malaga-based company: Dcoop, which, thanks to its intelligent alliance with the American company Pompei, has bottling plants in the US. Dcoop works with leading brands, under which it sells the Spanish product.
However, Dcoop has adopted a cautious attitude. "We will have to wait and see what measures are implemented in the coming months," said head of corporate relations Esteban Carnero.
In 2023, Dcoop exported products to the US worth 170 million euros, equivalent to approximately 12% of its total turnover. The vast majority of this figure, in terms of volume and price, is accounted for by oil. It also exports table olives (although sales have fallen sharply since the imposition of tariffs in 2018) and, to a lesser extent, wine. If Trump's tariffs on Spanish olive oil are similar to those from his previous term, the impact for Dcoop would be minimal, seeing as the company has locally based plants. However, if the tariff is extended to all incoming oil, whether in bulk or bottled, there could be serious economic consequences.
A business owner, who preferred to not be identified, stated that fear has been spreading among his counterfeits. "Meloni was at Trump's inauguration. Do you think she hasn't already negotiated for Italy to not have tariffs on oil? If our main competitor sells without penalty to the US, while we are charged tariffs, the price of Spanish produce is going to go down."
The other big product of Malaga's countryside - the avocado - could also be affected by this new protectionist wave, despite the fact that the US is not one of the province's importers when it comes to this fruit. "Malaga avocados are sold in Europe, so there is no direct risk, but if the US imposes tariffs on Mexican avocados, as Trump has announced, part of the Mexican crop could end up coming to Europe and then it would compete with ours," said Víctor Luque, general manager of Trops - the main subtropical cooperative in the Axarquia.
Trump's approach is not only a burden to the countryside. Spanish business owners from other sectors that have an important market in the US are also worrying. For exampe, Airzone - a Malaga-based manufacturer of climate control devices - fears a halt to progress in the US, despite the potential for growth and due to regulations related to energy efficiency getting paralysed. However, the impact in such sectors is expected to be less damaging than to agriculture, considering that each state has different regulations.
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