Impact of US tariff on spice exports
02-Aug-2025 11:26 AM
US President Donald Trump has decided to impose a flat rate of 25 per cent import duty on Indian products from August 7, which is likely to partially affect the export of some products from India in the spice sector along with other sectors. This includes spices like black pepper, turmeric and dry ginger etc.
After the new tariff, these Indian spices will become less attractive in America in terms of prices compared to competing countries like Vietnam and Indonesia.
As a result, the share of these Indian spices in the US market may decrease due to the increasing challenge from the ASEAN region. It is worth noting that America is the second largest importer of Indian spices.
During the financial year 2024-25, spices and spice products worth $ 711 million were exported from India to America, which was 15 percent more than the export of $ 619.29 million in 2023-24.
The export volume of spices also increased by 13 percent during this period and it increased from 1.114 lakh tons to 1.256 lakh tons. Indian spice exporters are worried about the possibility of losing their share in this important market as they will have to look for new markets to compensate for it.
Actually, the price of Indian spices is a bit high due to better quality, but after the new tariff, if it becomes too high, then the interest of American importers may decrease, which will benefit other supplier countries. The problem is not limited to tariff only.
The US President has said that if India continues to buy defense equipment and petroleum from Russia, then additional penalty can be imposed on its imported products in America.
It has been decided to impose a customs duty of 20 percent on Vietnamese products and 19 percent on Indonesian products in the US. India is the largest producer and exporter of spices in the world.
Due to tariff and penalty, the export of Indian spices to America may be partially affected in the near future, but the situation is expected to become normal in the next three-four months.
Currently, a 10% duty is applicable on Indian spices in the US and the importers have no problem with it but the new tariff will naturally increase the prices of spices there.