The Supreme Court’s decision on Feb. 20 to strike down many of President Donald Trump’s sweeping tariffs could have implications for the North State’s economy.
Though it’ll take time to see if the decision brings relief to local businesses dependent on international trade because Trump is exploring other ways to implement his tariff strategy.
California businesses have been facing increased costs due to the president’s tariffs, taking on about $11 billion in tariff costs from January through May 2025, according to Gov. Gavin Newsom’s office.
Before the ruling, Bonnie Persons, an associate professor in Chico State’s management department, told NSPR that critics of the president’s tariff strategy pointed to the economic uncertainty they’ve caused.
“Two small businesses that filed under the trade side of bringing this to the Supreme Court – they called it an existential threat to their business,” Persons said.
Why farmers may be especially vulnerable
Tariffs are taxes on imported goods. In response to Trump’s global tariffs, U.S. trading partners around the world have imposed their own retaliatory tariffs.
Persons said the North State’s agricultural sector is particularly vulnerable to counter tariffs because of its reliance on export markets.
Shifting tariff policies can affect international demand for popular local crops such as almonds, walnuts and rice.
California is the nation’s largest agricultural exporter, according to the Office of the United States Trade Representative. In 2023, the state shipped out about $24 billion worth of agricultural products. The top exports were tree nuts ($8.1 billion), “other” plant products ($3.2 billion) and fresh fruit ($2.9 billion).
“Certainly the administration is attempting to offset some of the impacts to agriculture,” Persons said. “It's unclear to what extent they'll be able to balance the challenges from trade with the actual bottom line to these agricultural groups.”
In December, the Trump administration announced $12 billion in payments for American farmers affected by “unfair market disruptions.” The assistance is for growers who produce a variety of crops including rice, barley and corn.
Trump blasted the Supreme Court’s ruling invalidating tariffs he imposed under the International Emergency Economic Powers Act. He said he’ll try to get around the decision by imposing tariffs under a different legal authority.
