President Donald Trump recently announced new tariffs on imports from almost every country.
Could the import taxes affect Mississippi businesses and jobs? The Magnolia state does most of its trade with Canada, Mexico and China. The state economy heavily relies on business with other countries. According to the Observatory of Economic Complexity (OEC), Mississippi exports for 2023 totaled $16.3 billion, and imports totaled $21.8 billion, meaning the state had a trade deficit.
Could price increases on imports and retaliatory tariffs on U.S. exports affect business and industry in Mississippi? What Mississippi industries could be affected in a trade war? Here’s what we know so far about the state’s trade partners and how many jobs rely on them.
What we know about Trump tariffs
In early February, President Donald Trump agreed to pause tariffs on Canada and Mexico for 30 days, a deadline looming next month.
Tariffs on China, however, have already been implemented. The county hit back at Trumps 10% tariff with a 15% one on U.S. imports, including cars and trucks made here. Automobile manufacturers across the country have been weighing how to balance the costs.
Trump argues that making foreign products more expensive will drive American industry and innovation. The funds will also be used to fund his political goals.
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“For consumers, tariffs are like another form of inflation, just spelled differently,” Darpan Seth, CEO of Nextuple, said in an interview with USA Today. “They have the same effect of rising prices.”
Two inflation reports released recently were higher than expected, and economists say more tariffs will drive up prices for consumers.
On Feb. 10, the president signed a new executive order putting new 25% tariffs on all steel and aluminum imports.
“Our nation requires steel and aluminum to be made in America, not in foreign lands,” said Trump. “We need to create in order to protect our country’s future and the resurgence of U.S. manufacturing and production.”
On Thursday, he announced plans to put 5% to 10% reciprocal tariffs on almost every country. The proposed tariffs would be a tailored list equal to the fees that other nations put on U.S. exports.
“Whatever they charge us, we’re charging them,” Trump said Thursday. “It’s a beautiful simple system.”
What are tariffs?
Tariffs are taxes that countries put on the goods and products imported from another country, according to The Tax Foundation, a nonprofit that provides research and analysis on tax policies.
Who pays tariffs?
They’re called a tax on other countries, but the people who pay the burden are the importers in the country that set the tariff, and that gets passed along to consumers. The other country does not pay the tariff, but the increase in cost could lead the market to look for cheaper sources.
The Tax Foundation notes that the results tend to be “regressive” and burden low-income households more than those with higher incomes.
According to the U.S. Census Bureau, about 18% of Mississippi residents live in poverty.
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What are Mississippi’s top exports? Where do they go?
About $2.19 billion in Mississippi exports went to Canada in 2023, $1.98 billion went to Mexico, $1.64 billion went to Panama, $782 million to the Netherlands and $781 million to China, according to OEC.
Top exports for the state in 2023 were:
- Light petroleum distillates nes: $3.13 billion
- Petroleum spirit for motor vehicles: $1.14 billion
- Medical and scientific instruments: $948 million
- Cotton (not carded or combed): $716 million.
- Chem wood pulp, soda or sulphate: $661 million.
What are Mississippi’s top imports? Where do they come from?
Imports from Mexico totaled about $2.88 billion in 2023, followed by $2.81 billion from China, $1.93 billion in goods from Canada, $1.13 billion from Venezuela and $976 million from Germany, according to OEC.
- Top imports from the state for 2023 were:
- Crude Petroleum Oils: $2.25 billion.
- Petroleum bitumen: $591 million.
- Artificial parts of the body: $589 million.
- Pig iron, non-alloy (<0.5% phosphorus): $576 million.
- Medical and scientific instruments: $555 million.
More:Trump takes aim at largest MS trading partner. See impact on proposed tariffs with Canada
Could tariffs implemented by President Donald Trump affect Mississippi’s automobile manufacturing industry?
According to the Mississippi Development Authority, Nissan, Toyota and PACCAR have productions in the state, and several automobile suppliers operate here. Additionally, Yokohama Tire, Cooper Tire and Continental Tire operate in the state.
More than 15,000 residents work at more than 200 auto industry employers.
Last month, the Nissan plant in Canton announced voluntary buyout packages that could affect hundreds of workers. Shift changes will start in April. The company had previously announced about 9,000 global layoffs, citing a sales slump in China and the U.S.
Tariffs and reciprocal import taxes in other countries are likely to further raise both production prices and consumer prices in the U.S. and for the countries vehicles here are exported to.
About 23% of steel used in the U.S. auto industry came from imports, according to the American Iron and Steel Institute.
About half of aluminum in the U.S. is also imported, mostly from Canada, per Reuters reporting.
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What does Mississippi trade with Canada?
Canada is Mississippi’s main export market. Seventy-three Canadian-owned companies reportedly employ 4,350 workers here, according to information from the Government of Canada.
Top goods exports for 2023 included:
- Optical, medical and precision instruments: $251 million.
- Automobiles: $224 million.
- Telephones & AV recording equipment: $180 million.
- Trucks: $98 million.
- Plastics & plastic articles: $88 million.
- Heating, cooling and refrigeration equipment: $71 million.
- Electric motors and generators: $62 million.
- Fuel oil: $45 million.
- Fertilizers: $44 million.
- Furniture and bedding: $34 million.
And services exports to Canada, including travel and financial and business services, topped $171 million
Top Mississippi imports from Canada include:
- Petroleum coke and bitumen: $592 million.
- Crude petroleum: $130 million.
- Pharmaceutical products: $79 million.
- Engines and turbines: $79 million.
- Plastics and plastic articles: $64 million.
- Agricultural machinery: $57 million.
- Motor vehicle parts: $55 million.
- Pasta, breads and cereal preparations: $55 million.
- Compressors and pumps: $43 million.
- Aircraft and parts: $33 million.
Canadian investments in the state include Southeastern Timber Products recently announcing a $123.4 million expansion of its operations in Ackerman. The move could make up to 40 new jobs and is part of a total $150 million improvement plan.
The Canadian National Railway Company is also investing $50 million in the state to upgrade rails and ties and maintain bridges and railway yards. The company employees about 500 in Mississippi and reportedly has contributed about $650 million to the state rail network over a decade.
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What does Mississippi trade with Mexico?
According to information from the foreign relations agency for Mexico, trade between Mississippi and the country totals about $4.9 billion and surpasses the entire United State’s trade with Greece, which was about $4.66 billion as of 2022.
The Relaciones Exteriores said trade with Mexico supports 39,000 Mississippi jobs, and Mexican investments in the state include Cemex, Alfa, Grupo Elektra, Lala and Groupo Salinas.
In 2023, Mississippi exported:
- Iron and steel.
- Motor vehicles.
- Petroleum and coal products.
- Basic chemicals.
- Semiconductors.
Mississippi imported:
- Motor vehicle parts.
- Electrical equipment and components.
- General purpose machinery.
- Transportation equipment.
- HVAC and commercial refrigeration equipment.
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What does Mississippi trade with China?
According to the U.S.-China Business Council, the state’s goods and services exports to China supported 7,440 job in America in 2022.
Top goods exports from Mississippi to China in 2023 included:
- Oilseeds and grains: $406 million.
- Crops: $198 million.
- Medical equipment and supplies: $170 million.
- Pulp and paperboard mill products: $137 million.
- Semiconductors and components $63 million.
Contributing: Swapna Venugopal Ramaswamy, Betty Lin-Fisher and Ross Reily
Bonnie Bolden is the Deep South Connect reporter for Mississippi with Gannett/USA Today. Email her at [email protected].
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