Market Morsel: Trump: Do as you’re told, or be hit by tariffs.

Conversations | 29th January 2025 | By Andrew Whitelaw

Market Morsel

This weekend, we got some back and forth between Trump and Colombia.

The newly inaugurated Trump is not taking his time. One of the big items that Trump won on was removing illegal immigrants, and he got the government to start doing raids and sending people on planes back to their home countries.

However, Colombia wasn’t having it, and refused to allow US military planes carrying Colombians to land. Trump retaliated by threatening to place a 25% tariff on exports to the USA, with the potential to increase this to 50% within a week. There was the potential of tariffs against USA exports to Colombia.

Usually, when we think of agriculture and Colombia, our first thoughts are coffee (and cocaine). So, I can imagine many Wall Street traders were initially a little concerned.

However, Colombia is a decent-sized importer of corn and beans. This tit-for-tat behaviour caused the market to react and fall.

By the end of the weekend, Colombia had agreed to accept deportations from the USA.

So, the crisis was averted, and US farmers didn’t lose this market. What it highlights is how volatile the coming years will be.

If a country does not follow what Trump wants, they may be subject to tariffs. Let’s hope our government doesn’t offend Trump, as we supply large quantities of meat to them.