Sting of tariffs felt in Cavan

Cavan exporters, particularly those in the food and drink sector, are already being squeezed out of the US market by new tariffs following Trump’s ‘Liberation Day’ last week, which one local businessman has described as a “kick in the teeth”.

A 20% tariff is being imposed on imports from the European Union to the United States, and it took effect from 5am this morning Irish time.

Addressing his “fellow Americans” last Thursday, US President Donald Trump said “our country and its tax payers have been ripped off for more than fifty years”.

“But it is not going to happen anymore,” he added, before signing an executive order on reciprocal tariffs on countries all over the world.

Pulling out a large billboard, Trump began with China when imposing his tariffs before making his way down the list to the European Union.

“You think of European Union, very friendly. They rip us off - it’s so sad to see.”

“It’s so pathetic,” he added.

Describing how US goods imported to the EU come under a 39% charge, he decided “we’re going to charge them 20%”, before taking a pen to his right hand and signing off on the levies, which he held up for the audience to much applause. The tariffs sent world markets into panic, while leaders scramble to deal with the fallout of the latest announcement.

A bit of a jam

The effects have trickled right down into Cavan. Moran’s Mega Jams has recently expanded its offering to the US.

Owners Kieron and Claire said they have been expecting the news for a while, describing it as a “big worry” over their heads.

They launched in the States just before Christmas, achieving a key goal for the business.

“We had the first couple of orders over and it was selling really, really well across all of America,” Kieron reported.

Their distributors in the US had been expecting the tariffs to come, therefore “hadn’t ordered for the last couple of weeks”.

“Now that it finally has happened, we don’t really know where we are with our distributor now in the States,” he revealed.

Kieron explained that the 20% tariff applies to “not only” the product but also the shipping of it, which is “what really makes it difficult”.

Pulling their products out of the United States is “something we don’t want to do”.

“Our dream was always to sell into the States, ever since we started the business, getting to sell to the United States has been one of the things on our bucket list.

“It’s not something that we really want to do but, at the end of the day, if it doesn’t make financial sense, what’s the point?” he asked.

“There’s no point in us selling stuff to America for nothing and not making any money on it,” conceded Kieron.

He said one “alternative” solution would be to set up in the United Sates and “make and Irish product in America” however he said this is “not really feasible at the moment”.

“I’m a little deflated to be honest because we worked so hard,” he said, adding that his wife and business partner Claire put her “life and soul” into getting Food and Drug Administration approval to sell in the US.

“Getting FDA approval for any small Irish business, it’s really, really difficult to get and, when you do finally get through all the hurdles, for this to now happen, it’s a bit of a kick in the teeth.”

“It is a bit soul destroying,” he added.

The business man said the “only other thing we can do” is “look on the bright side” and focus on selling more to their European partners. They already export to Finland, Italy and Australia.

“I suppose all we can really do is look at other markets we can get into,” he said, where “labelling laws” could pose another challenge.

“Either that or wait it out for four years until Donald Trump is gone and America sees sense and the rest of the world goes back to trading normally.

“He might roll back on it, you never know.”

For now, Kieron said the tariff situation leaves them in “limbo land”.

Dairy exports

As the representative body for Lakeland Dairies, director of the Dairy Industry Ireland, IBEC, Conor Mulvihill said Southern Irish dairy exports to the US are valued at approximately €830 million annually, which is about 11% of total dairy exports.

The products sent to the US are “dominated” by butter, however there are also “substantial” cheese, whey, casein and specialised nutrition exports.

Mr Mulvilhill said the tariffs could lead to a “potential” reduction in competitiveness due to higher prices for consumers in USA and a “risk of decreased demand and lower profit margins” for Irish dairy producers which “impacts farmers”.

He said we have “significant investments” from Irish dairy companies in the US with Glanbia, Kerry, Ornua, Carbery and Tirlan mentioned as “key players”, with US dairy and nutrition companies like Abbott and Leprino here in Ireland.

“We have developed significant win wins between the industry and Irish made dairy products are highly prized by US consumers,” he described.

Speaking on next steps, Mr Mulvihill advised those impacted to “keep calm” and “carry on” while taking “immediate steps to de-escalate trade tensions and prevent further escalation”.

“A constructive, co-operative approach focused on win-win outcomes is essential to maintaining a strong and mutually beneficial transatlantic trade relationship,” he added.

Supports and advice

Head of Enterprise at the Cavan Local Enterprise Office, Conor Craven, said advisors there are providing “a range of different supports” for small businesses affected by the tariff increases.

The key actions on the Cavan LEO website set out what companies “need to do”.

Meanwhile, Cavan LEO also has a new Market Explorer Grant, which gives companies the opportunity to evaluate and research new markets such as in Canada, the Middle East, Europe, the UK or Northern Ireland.

“That Market Explorer Grant is something that you might wish to talk to us about,” encouraged Mr Craven.

For further information search, localenterprise.ie/cavan

Minister’s view

Minister for Enterprise Peter Burke said his department has been preparing for the tariffs, and is working with Enterprise Ireland to support businesses “around tariffs and mitigation measures, as well as offering advice and support on diversification measures”.

“One to one meetings have been held with over 300 companies exporting to the US, with further meetings planned. We continue to urge all businesses exporting to the US to engage directly with Enterprise Ireland.

“We also have dedicated schemes and grants, including a strategic consultancy grant for expert advice. We have an existing market discovery fund already open, which I will top up further when demand is met, and I will be pro-actively engaging with businesses to make them aware of these supports and ensure they are accessed at scale,” the Minister said.

Meanwhile he flagged the Department’s “expansive trade mission programme plan” in place.

“I am conscious that this is an evolving situation, which will be closely monitored, and Government will not be found wanting when it comes to resourcing and supporting Irish SMEs, which are the backbone of our economy,” said the Mullingar man.