New Zealand is set to face a 15% tariff on exports to the US as President Donald Trump confirmed his reciprocal rates.
It comes as Trump signed an executive order that would have new tariffs on a wide swath of US trading partners to go into effect in seven days — the next step in his trade agenda that will test the global economy and alliances.
The order was issued shortly after 7pm (local time). It came after a flurry of tariff-related activity in recent days, as the White House announced agreements with various nations and blocs ahead of Trump’s self-imposed August 1 deadline.
US President signs an executive order for new tariffs on a wide swath of US trading partners to go into effect in seven days. (Source: 1News)
“President Trump is using tariffs as a necessary and powerful tool to put America First after many years of unsustainable trade deficits that threaten our economy and national security,” a statement from the White House said.
When first detailing his proposed tariffs, it appeared NZ would face a 10% tariff rate on exports to the US.
On RNZ shortly after midday, Trade Minister Todd McClay said trade officials in Washington had told officials at the New Zealand embassy “a short while ago”.
“We’re still getting details about exactly what has been announced.”
McClay said it appeared all the countries hit with a 15% tariff were ones with a trade surplus with the US, who sold more than they bought. He estimated New Zealand had a trade surplus with the US of around half a billion dollars, and amount McClay described as “not overly significant in the context of the US economy”.
“We will be making the case about why this shouldn’t have happened, and engaging very, very quickly, again with US officials to clarify this and seek changes around the new tariff put on New Zealand exporters.”
He said many exporters were able to absorb the added cost under the 10% tariff but, under the new rate, “it is going to start having a greater effect upon our exporters”.
“We sell about $9 billion worth of goods into the US every year, and so a 15% tariff rate is meaningful.”
McClay said the new rate was not a surprise, as over previous weeks, Trump had indicated he was keen to bump up the bottom tariff rate.
He said the new rate, based on a trade deficit, was something “very new”.
New Zealand was not considering any reciprocal tariffs, McClay said, and would continue to hold discussions with US trade officials.
According to Stats NZ, the US was the second largest export destination for New Zealand goods in 2024 behind China.
In 2024, exports to the US surpassed $9 billion for the first time, with the US receiving a total of 12% of New Zealand’s exports by value.
Exports of meat were New Zealand’s largest export to the US, with chilled and frozen beef accounting for $1.8 billion in trade value as of January 2025.
Fonterra: ‘Global demand for dairy remains strong’
Dairy exports were the second-largest, with the US receiving $883 million worth of New Zealand’s milk powder, butter, and cheese in 2024.
Group director of global external affairs for Fonterra, Simon Tucker, said the 15% baseline tariff was disappointing but the co-op was confident it could continue to perform well across its portfolio of markets.
“This is disappointing news and we will continue to work through the implications for our business. However, global demand for dairy remains strong and Fonterra’s size, scale, and broad product portfolio and market mix means we are well positioned to navigate changes in market dynamics,” he said.
Other major exports to the US in 2024 were $702 million of wine and $687 million of mechanical machinery and equipment. This included agricultural machinery, engines and machine tools.
According to the Ministry of Foreign Affairs and Trade, the US’ biggest exports to New Zealand were mechanical machinery; aircraft and parts; optical, medical and measuring equipment; and vehicles.
‘Significant impact’ on NZ wine sector
Sarah Wilson, general manager advocacy for New Zealand Winegrowers, said the tariff was “very concerning” and would have a “significant impact” across the industry.
“The United States is our largest export market, and this announcement represents a substantial increase to the tariff rates that were in effect at the start of this year.”
She said the average tariff per 750ml bottle in March was less than 10 cents; the new tariff would increase this to around $1.10 per bottle.
Wilson said the US would gain around $112 million through New Zealand wine under the new rate.
‘Vindication for the Albanese government’
Australia was not included on Trump’s list, and its products would continue to be subject to a baseline 10% tariff rate.
Trade Minister Don Farrell welcomed the confirmation that Trump had resisted the calls to lift tariffs on Australian goods.
“There had been some pressure in the American system for an increase, but President Trump had decided to maintain that 10%,” he told reporters in Adelaide on Friday.
“This is a vindication for the Albanese government and particularly the prime minister, in the cool and calm way that we have conducted diplomacy with the United States.
“This decision by the United States government is a very positive one for our relationship.”
Syria was the worst-hit country, with a 41% tariff rate. Laos and Myanmar were at 40%, and Switzerland was at 39%.
— additional reporting by Associated Press, AAP
