How another Trump trade war could hurt Virginia

In 2024, Virginia imported $41 billion worth of goods and exported $22 billion worth of goods, according to data provided to The Dogwood by the Virginia Economic Development Authority.

President Donald Trump’s return to the White House has meant tariffs are back in the news, raising fears about how the levies on foreign goods will impact Virginia’s economy with its robust international trade. 

While there is plenty of uncertainty about which of Trump’s tariffs will actually go into effect, the latest is that on Tuesday he announced plans to impose 25% tariffs on cars and automobiles by April 2. His administration has imposed a 10% tariff on all imports from China, and is still considering 25% tariffs on goods from Mexico and non-energy imports from Canada. 

That’s bad news for Virginia given the billions of dollars worth of exports and imports that flow in and out of the state. While Trump says the tariffs are meant to win concessions from other countries and support US industries, most experts agree that tariffs will raise prices for businesses and consumers. Meanwhile, Trump has yet to roll out an industrial policy to help develop domestic industries the tariffs would ostensibly protect.

“I think the biggest potential risk is how foreign countries might respond,” Jason Grant, a Virginia Tech professor of agriculture told The Dogwood. “If they target specific industries in Virginia that are important to the Virginia economy, then that’s where things can get economically risky for these sectors.” 

In 2024, Virginia imported $41 billion worth of goods and exported $22 billion worth of goods, according to data provided to The Dogwood by the Virginia Economic Development Authority.

Since 2022, Canada ranked as the top destination for Virginia goods like tractors, printing machinery, and trailers and semi-trailers. China ranked second among Virginia’s top export countries. Coal, different kinds of plastics, and soybeans were among the top products Virginia shipped to China.  

The first Trump Administration got into a trade war with China that resulted in Virginia’s soybean farmers taking a hit. Then-Governor Ralph Northam said at the time the tariffs threatened profits for Virginia’s soybean farmers and US Senators Tim Kaine and Mark Warner said at the time Virginia’s soybean farmers “brace for the worst every time the word ‘tariff’ is said in the Oval Office.”

Similar concerns are playing out today. 

“The major, major impact would be on the agricultural sector in the United States once retaliatory measures are imposed on us,” said Stuart Malawer, a professor emeritus of policy and government in the Schar School of Policy and Government at George Mason University.

Tariffs are taxes on imports to the US from other countries. Despite what Trump says to the contrary, American companies ordering the goods from overseas cover the costs of the tariff. These companies typically pass along the extra cost to consumers. Countries usually respond by slapping tariffs of their own on American goods. 

“If the tariffs are enacted and they stay in place long term and countries retaliate and keep their policies in place long term, you’ll see all those prices tend to creep up,” said Brett Massimino, an associate professor and department chair for supply chain management and analytics at Virginia Commonwealth University.  

Consumers are already struggling with price increases. Inflation is at 3%, while egg prices are up 15.2% from where they were a year ago. 

"I am very troubled by the impact tariffs could have on Virginia, especially on my constituents in Hampton Roads,” state Sen. Angelia Williams Graves told The Dogwood. “The President made a promise that prices would decrease, yet they have risen instead.”

Gov. Glenn Youngkin did not respond to a request for comment.