Following previous import duties on Mexico, Canada, and China—some of which were later paused—U.S. President Trump has now authorized new import duties on steel and aluminum. Starting on March 12, he ordered a 25% import tax on all steel and aluminum entering the U.S., marking a significant expansion of existing trade barriers. Greenhouse construction companies are closely monitoring developments, hoping the president will realize that this measure could also have negative consequences for the country itself.
Historical context and industry response
During President Trump's previous term, similar measures were announced and eventually implemented. However, at that time, Dutch greenhouse construction and installations were exempt from the tariffs.
"At that time, he saw the consequences, and European greenhouse construction was not affected by the tariffs," recalls Annie van de Riet, chairwoman of the Dutch greenhouse industry body AVAG.
Now, Trump says he will remove all exemptions from 2018. Annie points out that March 12 has not yet arrived. "There are still a few weeks to negotiate." The Dutch greenhouse construction lobby is working through VNO-NCW, but in the bigger picture, their influence is limited.
Lambert van Horen, Food & Agri – agri-horticulture specialist at RaboResearch, believes that Trump's current actions are primarily a negotiation tactic rather than a deliberate economic policy. "From a general economic perspective, taxing everything is not a wise policy. It drives up inflation in the U.S. Trump himself, likely advised by economists, seems to recognize this. That's why he is now imposing more targeted tariffs."
Exact impact on costs
"Steel and aluminum are significant cost components, and when tariffs are imposed on these materials, it will certainly increase costs," says Henk Verbakel of Havecon, a company that builds extensively in Canada and the U.S. "However, other components and labor also make up a large portion of costs. It's difficult to determine the exact impact, but it could be around 5 to 10 percent. On the other hand, four years ago, the dollar exchange rate was at 1.20 – that also has an effect."
Domestic prices
The total effects of the new policy are complex because not all greenhouse builders produce their own materials. "Those that do, outside the U.S., will likely feel the import tariffs the most", predicts Lambert. "Greenhouse builders who purchase structures may start shopping around. Instead of choosing a Dutch supplier, they might consider an American one. If Trump's decision goes through, it could lead to shifts in the supply chain of greenhouses." And even local greenhouse construction in the U.S. may be affected, as the price of domestic steel could also rise.
In the EU, steel quality is higher, according to Peter of Meteor. Meteor uses coated steel. "European companies are more advanced in coating technology than those in the U.S." Meteor and its customers prefer better-quality steel. "Our new MS-150 offers the latest protection for our cultivation gutters. With increasing disease pressure and the more intensive use of disinfectants and cleaning agents, there was a need for this. This level of quality can only come from the EU; it is not produced in the U.S." However, he also is assured companies that buy U.S. steel will also end up paying more if this goes through.
However, when it's about quality, it's always a debate. For example, a US greenhouse builder US says one of its standout features is its domestic sourcing. "All of our steel is sourced in the U.S. There are a few components, like motors, that we have to source elsewhere, but the backbone of our structures comes from American steel. That's a big deal for quality and longevity."
Also, gutter producer Growtec often works with locally produced steel for the production of their gutters. "We also buy the majority of the steel for our projects in the US in the US," says Ruud van Aperen. There is enough product available there for the time being. "There is no signal that there would not be enough – but the question is at what price. With these developments, it is expected that this price will also increase."
Possible opportunities and market shifts
In the short term, the outlook remains uncertain. Annie notes: "Trump's announcement contributes to this uncertainty, but geopolitics are already volatile." Lambert observes the same. "Uncertainty is never good. Constantly worrying about what Trump will do next is the worst part. It affects investment decisions."
Peter from Meteor acknowledges the impact of "all these decrees" on the global market. "As the horticulture industry, we have to deal with it." Was he shocked? "Yes, because it involves serious amounts of money. But also, not really. This protectionism was expected. It contradicts his campaign promise of making daily life cheaper."
However, the greenhouse itself is not the biggest cost factor in greenhouse farming. "A greenhouse today lasts about 30-35 years. In terms of operational costs, it is not the most significant expense. But one thing is clear: implementing these tariffs will not make steel cheaper."
Uncertainty over tariff scope
Much remains uncertain. "Will the tariff apply to raw materials or finished products?" wonders Henk Verbakel. "During Trump's previous term, it only affected semi-finished products, not processed components." The sector hopes for the same scenario now because one thing is certain: uncertainty benefits no one. "U.S. customers will wait to see what happens, and even Mexican and Canadian customers will seek more clarity."
Another question is whether additional tariffs will follow. Despite the cost of production rising in the industry, the earlier announced tariff on imports of fruits and vegetables from Mexico and Canada could boost local U.S. production, potentially benefiting the U.S. greenhouse construction industry. One thing however is sure, and that's what also strangles many people: either way, food costs in the US, a country that's been struggling with increasing inflation over the last few years, are to increase further with all import duties.
Negotiations
Negotiations remain possible until March 12. For now, the greenhouse construction sector will have to operate under uncertainty, according to the Rabobank specialist. "The current risk will translate into prices. Greenhouse builders will either absorb the risk in their pricing or pass it on to investors." He also notes that the dollar exchange rate has already risen in recent months. "For those thinking in euros, this partially offsets the impact. For those operating locally in dollars, it may prompt businesses to reconsider how and where they source materials."
Peter, like Lambert, urges people not to panic. Greenhouse builder KUBO expresses a similar sentiment. They refer to Trump's previous term and caution against concluding too quickly. In 2018, an exemption for European steel was ultimately granted. "Given the current lack of clarity on the scope of these new measures, it is advisable to await further details before drawing conclusions or taking unnecessary action. We are closely monitoring developments and remain in dialogue with relevant stakeholders to safeguard the interests of the sector," says Wouter Kuiper from KUBO.
For containers already en route, Peter hopes they arrive before March 12. For those yet to be shipped, arrangements are being made with customers as part of the ordering process. Peter concludes: "Trump is a negotiator. And this is part of it. With Trump, things are never boring."
Optimistic?
Beyond Trump's policies, the Dutch greenhouse construction sector faces other uncertainties. Yet Annie remains optimistic about the future. "The long-term outlook is very positive. There is strong interest in healthy, sustainably grown food." Dutch greenhouses play a crucial role in this trend. More and more crops are considering, or have already switched to, covered cultivation. "This keeps the overall sentiment positive. Our sector contributes to sustainability and offers solutions for climate change." Lambert agrees.
On behalf of the European Commission, Ursula von der Leyen has also responded—on X. She has promised a European response to the newly announced U.S. import tariff. "I deeply regret the U.S. decision to impose tariffs on European steel and aluminum exports. The EU will act to safeguard its economic interests. We will protect our workers, businesses, and consumers."