President Donald Trump reportedly said he would be instituting 25% tariffs on foreign steel and aluminum, a move that some fear will change the equation for restaurants looking to expand.
While on the way to the Super Bowl on Sunday, the president told some media outlets that the sweeping tariffs would announced on Monday or Tuesday. This came after last week’s scuffle with Canada and Mexico over proposed tariffs on other goods, which Trump later paused for a month. A 10% tariff on China did go into effect, however.
Now Trump appears to be bringing back the tariff on steel and aluminum, which he enacted during his first term in an effort to protect domestic metal makers. At the time, the tariff created more tension with Canada and Mexico, as well as the European Union, though some of those tariffs were later rolled back or exceptions were negotiated.
Canada is the biggest foreign supplier of steel and aluminum to the U.S., and the once-friendly ally has already announced plans to retaliate against Trump’s proposed tariffs last week. Canadian Prime Minister Justin Trudeau pledged to slap a 25% tariff on American goods flowing into Canada, from beer and wine, to fruits and vegetables, beef, pork and dairy.
And more tariff-related news is coming later this week. Trump also said he planned to move forward with “reciprocal tariffs,” which would raise U.S. tariffs to match those of other countries.
What this could mean for the restaurant industry remains unclear.
“This is a rapidly moving issue, and, just like everyone else, we’re trying to figure out what it means,” said Charlie Souhrada, vice president, regulatory and technical affairs for the North American Association of Food Equipment Manufacturers, or NAFEM.
The move does not come as a surprise, Souhrada said. “We anticipate it would have an impact [on the industry], but we just don’t know yet what kind of an impact.”
As of Monday afternoon, the Trump Administration had not made any formal announcement or offered any explanations about how they might be carried out, or whether there might be exceptions.
NAFEM offers a resource page on its website with what is known on Trump 2.0 tariffs as proposed so far. In the past, NAFEM opposed the then-called “232 tariffs” on steel and aluminum, and worked with a number of coalitions to address them, Souhrada said.
Trump has argued that tariffs will eliminate a trade imbalance, but many economists argue the result will be higher prices for American consumers.
Michael Benson, president of the Southern California Restaurant Design Group, based in Encinitas, California, said tariffs on steel and aluminum would likely be a setback for restaurant development—and it comes just as inflation on equipment had begun to ease after a post-Covid spike.
After Covid, supply chain challenges slowed restaurant expansion and contributed to higher costs.
“What tariffs will do is very much the same effect,” said Benson. “It will also impact the supply chain if many manufacturers have to change the companies they’re buying metal from.”
Benson—whose company works with both restaurant chains, like Habit Burger, Café Rio and Starbird, as well as independents, hotels and foodservice contractors—said the restaurant community in Los Angeles, in particular, will likely be hit hard by tariffs after fires across the city wiped out large neighborhoods last month.
“In Los Angeles, a lot of the restaurants that burned down will not get the type of money from insurance that they’ll need to rebuild, and, with this, there will be a double whammy where it will either slow down the process of rebuilding, or I think a lot of restaurant owners will walk away,” he said. “This is not good news for the restaurant industry as a whole.”
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