By Manuel Ausloos
Yverdon-Les-Bains, Switzerland (Reuters) -Swiss cheese producers are bracing for a steep drop in U.S. sales after President Donald Trump announced a 39% tariff on Swiss imports due to take effect on Thursday.
Swiss President Karin Keller-Sutter and Business Minister Guy Parmelin have travelled to Washington for meetings with American officials in a last-ditch effort to negotiate down the tariffs, which took Switzerland by surprise.
Switzerland was left reeling by the news, especially after the government thought it had clinched a deal for a lower level of duties, and companies had promised investments in the U.S.
The United States is an important market for Swiss cheese, buying 11% of Swiss cheese exports like Gruyere and Emmentaler last year, according to Swiss customs data.
Gruyere, Switzerland’s largest cheese industry, sees 40% of its production shipped abroad, with a third of that destined for the United States.
Anthony Margot, a fifth-generation cheese maturer, said immediately after the tariff was announced on Friday, he started receiving calls from “very concerned” customers in the U.S. hoping a deal could be done.
“The taxes are enormous. Gruyere is a niche product that’s already very expensive to begin with, and unfortunately, people who can still afford Gruyere in the United States will have to pay more for it,” Margot told Reuters.
Cheesemakers would also look to expand into other markets to compensate, but this would be difficult, he said.
“We can’t replace a market like the United States overnight,” said Margot in his maturing cellar, where hundreds of wheels of cheese age for several months before being sold.
Gruyere producers have already responded by reducing production by 3%, boosting marketing investments, and preparing to increase prices for U.S. consumers.
Producers’ association ‘Interprofession du Gruyere’ estimates that annual exports to the U.S., averaging 4,000 tons, may drop by 1,000 tons due to the new tariffs.
That would reduce revenue by up to 15 million francs ($18.6 million), manager Olivier Isler said.
“The Gruyère sector is the most important cheese sector in Switzerland,” said Isler who runs a cheese-making factory in nearby Pringy. “It’s a hard blow.
“We thought we’d be among the least taxed countries, but in the end, we’re in the group of the most heavily taxed countries,” said Isler.
($1 = 0.8071 Swiss francs)
(Reporting by Manuel Ausloos, writing by John Revill, editing by Alexandra Hudson)
