How Trump tariffs in the US push Spanish producers to look for other markets

A Seville bar with a waitress cutting ham. — Photo foot, The famous Iberian ham is one of the great exports of Spain.

- Author, Guy Hedgecoe
- Author's title, BBC business reporter
June 18, 2025

It is lunch time in a bar in southern Seville. The Bulle of Activity Kitchen and, behind the bar, an employee serves a very cold tap beer.

Next to it, another uses a ham knife to cut slices of Iberian ham and place them on a dish to serve them as an appetizer.

There are few more Spanish scenes. And there are few more Spanish products than Iberian ham, whose unique salty flavor is famous throughout the world and is part of a national industry that moves almost US $ 850 million a year in exports.

While observing how the ham is cut, Jaime Fernández, international commercial director of the Osborne Group, which produces wine, Jerez and the famous Five Jotas ham mark, describes it as a “emblematic” national food.

“It is one of the most emblematic gastronomic products in Spain,” he says, pointing out that the pigs used to make the ham are raised in freedom and feed on acorns. “It represents our tradition, our culture, our essence,” he says.

But the Iberian ham, like the products from all over Spain and the rest of Europe, faces the threat of commercial tariffs imposed by US President Donald Trump.

Spanish ham exports to the US were not subject to tariffs until April of this year, when a 20% tax on all European imports were suddenly introduced, which was reduced to 10% waiting for negotiations.

However, in May Trump again worried European exporters by stating that the tariff for all EU products could rise up to 50% if commercial conversations with Brussels do not come to fruition. The current deadline for this is July 9.

“The United States is one of our priority markets,” says Fernández. “Uncertainty is there and complicates our planning in the medium and long term, investments and commercial development.”

The tariffs, he adds, “suppose a threat to our industry.”

Jaime Fernández. — Photo foot, Jaime Fernández says his company already studies investing in China as an alternative to the United States.

The Spanish economy enjoys good health. The IMF foresees for this year a growth of 2.5% – very higher than that of the other great EU economies – and unemployment is at its lowest level in 17 years.

But the tariff issue is a hard blow to the country's swine industry, which represents more than 400,000 direct and indirect jobs and is the largest in Europe.

The demand for healed ham in the US has grown substantially in recent years, and has become the largest importer of Spanish ham outside the EU.

But the Spanish industry now faces the perspective of having to raise the sales prices to the public for American consumers and lose competitiveness in front of local products, or not subject to the same tariffs.

Iberian pigs. — Photo foot, Spain is known for the quality of its Iberian breeds and for the ham they produce.

The Spanish olive oil sector is found in a similar dilemma.

Spain, the world's largest producer of olive oil, had set its sights in the United States as a flourishing market whose growth was driven by the growing awareness of the health benefits of the product.

However, tariff turbulence arrive just when Spanish producers and exporters have recovered from a drought that drastically reduced crops in the south of the country and temporarily fired prices.

USA represents half of the world consumption of olive oil outside the EU.

It is also the country whose imports from this product from Spain have grown in recent years, moving from about 300,000 tons per year ago about 430,000 tons, says Rafael Pico Lapuente, general director of the Spanish Association of Olive Oil Exporters (Asoliva).

Much will depend, he says, on the final tariff to be fixed for the EU.

“If there is a permanent 10%tariff, without differentiating between countries of origin, it will not create distortions in the international market,” says Pico Lapuente.

He explains that American consumers could have to absorb the additional cost. And although US producers of olive oil or similar products would obtain a competitive advantage, their production is small enough to not affect countries like Spain.

However, he says that we would be facing “a different situation” if Trump introduced higher tariffs for the EU than for countries outside the block that are competitors of olive oil, such as Turkey, the second largest world producer, or Tunisia, an emerging producer. That scenario, he says, would have a great impact on the world market and Spanish producers.

But tariff variations between countries or commercial blocks would also cause a certain flexibility of standards and even chaos, according to Javier Díaz-Giménez, economy professor at the IESE Business School of Madrid. It proposes as a hypothetical example of two direct neighbors in Spain.

“If Spain has a 20% tariff and Morocco and Andorra of 10%, all Spanish products that can go through Morocco or Andorra … will do it.”

And he adds: “First they will be exported to Morocco and Andorra and from there they will be re -exported to the United States with a 10%tariff.”

“And it will be very difficult to make sure those olives come from Andorra proper and not from Spain. Is Trump do something about it?”

Olive oil bottles. — Photo foot, Spain is the world's largest producer of olive oil.

For now, Spanish producers and exporters must contain breathing while developing EU negotiations with Washington. For Pico Lapuente, a great reason for concern is the influence – or, as he sees, the lack of influence – that his sector exerts within the European commercial block.

“The negotiations that represent the 27 EU countries are Brussels,” he says. “In these negotiations, industrial products have much more influence than food.”

“I would not like that, in this negotiation, food products such as olive oil will be used as mere exchange coins to get a better agreement for European industrial products. That worries me. And I hope it does not happen.”

A spokesman for the European Commission declared the BBC that in negotiations with the USA will act “in defense of European interests, protecting its workers, its consumers and their industries.”

Jaime Fernández, from the Osborne group, believes that his industry could live with the 10% tariff in force without suffering too many consequences.

However, a tax of 20%, according to him, would make the industry “rethink how to accelerate growth in some other markets, which would end up causing the relocation of resources from the United States.”

Díaz-Giménez affirms that his company is already studying alternative markets to invest, such as China, or European consumers of tested efficiency ham, such as France, Italy and Portugal.

Díaz-Giménez states that it is the logical response to current uncertainty.

“If I were the general director of any company with high exposure to the United States … I would have sent all my sales team to look for other markets,” he says.

“And at this point, they would have found them. There will be plans B and C Plans, to ensure that we have reduced this exposure to the United States.”