US trade policy reversal sparks concern and instability in the global produce market

The United States Supreme Court’s February 20 decision to strike down all tariffs imposed under the 1977 International Emergency Economic Powers Act (IEEPA) and the trade move has prompted mixed responses from the country’s primary produce partners.

Reacting swiftly to the court’s ruling, President Donald Trump denounced the decision as disgraceful and swiftly swapped the IEEPA tariffs for a new 10 percent levy under section 122 of the Trade Act, which he later raised to 15 percent.

The ongoing tug-of-war between federal branches has left the global produce industry pleading for stability after months of negotiations with the White House, only to see their efforts undone by the new Trade Act levy.

In tariff discussions, global produce prepares for the worst

Bernd Lange, chair of the EU Parliament’s International Trade Committee, stated that the decision has increased trade uncertainty and said imposing a levy under section 122 of the Trade Act undermines the terms of the Turnberry Deal, the US-EU trade agreement reached in July 2025 to regulate commercial relations between the country block and the United States. The SCOTUS decision, Lange says, invalidates the document.

Because Section 122 applies to all exporting countries without exception and stacks on top of the existing Most-Favored Nation rate, EU imports into the US now face a combined tariff that exceeds 15 percent.

“Shadow rapporteurs, representing a majority of members, have agreed that under the current circumstances, work on the two Turnberry files should be put on hold until clarity, stability, and legal certainty in EU–US trade relations are re-established,” he adds.

On the other side of the Atlantic, and despite being one of the leading markets that suffered the brunt of the levies, with overall exports decreasing by 70 percent and its citrus sector put in jeopardy, Brazil’s fruit industry representatives say they're not getting their hopes up.

Eduardo Brandão, of Brazil’s Association of Fruit and Derivative Producers and Exporters (Abrafrutas), notes that skepticism remains, even though the new tax rate is much lower than last year’s 50 percent. 

"Every hour there's different news—on Friday [February 20] it was 10 percent, today it's 15 percent, and tomorrow it could be a different situation. So, nobody knows what will really happen," Brandão emphasized.

Meanwhile, South Africa’s industry body Hortgro advised exporters to prepare for short-term price pressure in the US market, potential front-loading of imports, and shipping volatility as the administration revises its tariff framework.

“Regarding refunds, the US Court of International Trade will determine the process for reclaiming previously paid IEEPA tariffs. Only the Importer of Record may claim refunds, so exporters must rely on contractual arrangements to recover any shared costs,” the organization states.

Chile’s fruit industry expressed concern over the levy increase, which raises all exports to the US from 10 percent to 15 percent under Section 122 of the Trade Act.

In a statement, industry body Frutas de Chile said the five percent increase is significant and will negatively impact the fruit industry, as the US is one of the sector’s primary trade partners.

“Given the severity of the news, Frutas de Chile is making an urgent appeal to President Gabriel Boric and to the incoming administration led by José Antonio Kast to address this delicate situation,” the organization pleads. 

Chile’s table grape export season, which the organization identifies as one of the most affected by the tariffs, has just begun. The increased levy, combined with the recent Systems Approach suspension, could be catastrophic for the industry.

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