The forecast by IACA predicts an increase in costs of up to 145 million euros.
“IACA fears that the implementation of customs duties between the US and the EU may compromise animal feed production, the competitiveness of the livestock sector, and cause instability and price increases in Portugal’s food supply,” it warned in a statement.
The companies thus propose transatlantic trade agreements between the two blocs to avoid a rise in food prices.
The association expressed concern over the EU’s response to the US’s imposition of a 25% tariff on steel and aluminum imports and 20% on other products, predicting an additional cost of 20 to 25% on the value of certain raw materials.
In Portugal, animal feed companies import 18% of the corn and 36% of the soy they require from the US, totaling 240 million euros.
“Predicting that some of these increases will be reflected in this sector’s value chain, foods such as meat, fish, milk, and eggs will see price increases for consumers,” it noted.
Quoted in the same note, IACA president Romão Braz expressed disapproval that a potential EU retaliation against the US might include agricultural products.
“These raw materials are the foundation of food production. It is important to remember that in Portugal, since the start of the war with Ukraine, the basket of essential foods has already risen by more than 30%. In reality, we do not understand how measures with foreseeable impacts on essential goods can be considered,” he argued.
IACA has 55 members, representing 80% of the national production of compound animal feeds and all of the premixes for animal production.
The animal feed sector has an annual turnover of 2.3 billion euros, representing 12.5% of the agricultural industry’s revenue.
