If your grocery bill is higher than usual, one place to look is tomatoes. The price of tomatoes is up 23 percent compared to last year (see Rutgers data below). Part of that increase can be attributed to higher transportation costs or fluctuations in Florida's weather. But let's not overcomplicated this.
The biggest change in the tomato market was not meteorological: it was policy. Last year, the U.S. changed its tariff-free policy on Mexican tomatoes and replaced it with a 17 percent tariff. When 90 percent of tomatoes come from Mexico and you tax those tomatoes, it should not be a surprise when the price of tomatoes increases.
As a matter of fact, there were many that warned about these negative effects, myself included. It is not complicated what happened here. When the U.S. slaps tariffs on Mexican tomatoes, which is the primary source of tomatoes for the U.S., you are going to get more expensive tomatoes. Not maybe or probably. You will get more expensive tomatoes.
Tariffs are taxes on imports. Like most taxes, they do not sit quietly in the background doing nothing. They change consumer behavior, such as having tomato imports in 2025 declined by $500 million in comparison to the previous year. The tariffs worked their way through the supply chain and made their way to the consumer, which is also not surprising since 95 percent of tariffs are paid by the consumer.
None of this is unique to tomatoes. This is how tariffs work. When you tax imports with tariffs, you reduce supply, distort markets, and raise prices. The specifics vary by product and tariff amount, but the mechanism does not change.
Whether it's tomatoes, steel, or washing machines, the pattern is the same: a concentrated benefit for a small group of well-connected domestic producers while everyone else pays the price. Protectionists can call that "saving jobs" all they want, but consumers experience fewer choices and higher prices. Tariffs don't protect markets. They just make them more expensive.
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