From cattle to crude: How Trump’s tariffs are rattling the Lone Star State

As the Trump administration works to corral global trade relationships, the Lone Star State is saddling up for what could be a bumpy ride.

Texas, the nation’s top exporter, relies heavily on international commerce, making it highly vulnerable to President Donald Trump’s sweeping tariffs. 

From cattle to cotton to crude, Texas trade contributed a cool $850 billion to the U.S. economy in 2024, according to the Federal Reserve Bank of Dallas.

 TRUMP ANNOUNCES SIGNIFICANT 30% TARIFFS AGAINST MEXICO, EU TO BEGIN NEXT MONTH 

Over the weekend, Trump announced plans to impose a 30% tariff on imports from Mexico and all 27 European Union member states. Those tariffs, slated to take effect on Aug. 1, add to a growing list of more than 20 countries already facing similar measures. 

While the trade deals are not finalized, analysts are sounding alarms that Trump’s mounting trade war could mess with Texas.

Washington-based research firm Trade Partnership Worldwide estimates that tariffs announced during the first five months of Trump’s term alone could cost Texas businesses $6 billion, based on trade data through May.

The economic research firm also predicts Texas — one of the top copper-importing states — will pay approximately $693 million from the imposition of new 50% tariffs on copper and copper products, according to 2024 trade data.

The Federal Reserve Bank of Dallas estimates that higher tariffs will reduce the state’s gross domestic product by 1.5%. Fed analysts also estimate that the decline in economic activity could result in the loss of approximately 100,000 jobs.  

A BREAKDOWN OF THE TRADE LINKS OF TRUMP’S LATEST TARIFF TARGETS

Meanwhile, Farmers for Free Trade, a nonprofit advocacy group, estimates that tariffs paid by Texas importers in March surged 165% to $1.5 billion compared to March 2024.

When asked about the potential impact of tariffs, a spokesperson for Texas Gov. Greg Abbott called it a “rare chance to reset global supply chains.”

“Texas is an economic development powerhouse, and we welcome new jobs and manufacturing from global businesses looking to expand American operations,” Abbott press secretary Andres Mahaleris said in a statement to FOX Business. 

Texas Sens. Ted Cruz and John Cornyn did not immediately respond to FOX Business’s request for comment.

Glenn Hammer, president and CEO of the Texas Association of Business, also downplayed tariff concerns, stating that Texas’s diversified economy is well-positioned to withstand ongoing trade disputes.

WALL STREET SHRUGS OFF TRUMP’S FRESH TRADE WAR RHETORIC, INVESTORS HOLDING FIRM

“Texas is very bullish on where the Texas economy is going and on the Trump administration’s efforts to make America the manufacturing powerhouse of the world,” Hammer told FOX Business.

When asked about the 30% tariffs placed on goods from Mexico, Hammer said all United States-Mexico-Canada Agreement-compliant goods and services should stay tariff-free.

“We support all efforts to ultimately achieve a tariff-free, barrier-free trade relationship with both of our top trade partners – Mexico and Canada – and ensure North America can be the world’s most competitive economic bloc, with Texas as its centerpiece,” Hammer said, adding that Mexico City and Ottawa are Texas’ top trading partners.

TEXAS WILL BE AMONG HARDEST HIT IN TRADE WAR, EU AMBASSADOR WARNS

“We do not want to see efforts that would take us in the opposite direction and reduce our ability to compete with China and the rest of the world,” he added.

He said small Texas businesses are likely to face challenges from higher tariffs because they “simply do not have the resources or the supply chains to rapidly adjust” like larger firms. According to the Texas Economic Development Office, more than 92% of all Texas exporters are small businesses.

Earlier this year, the European Union ambassador to the U.S. said in a March interview with FOX Business that Texas is also the top trading partner for the 27-country bloc.

“The European Union invested in Texas more than $300 billion,” said Ambassador Jovita Neliupšienė. “Because of this trade and investment, 300,000 people are employed only because of the EU.”

Fox News Digital’s Emma Woodhead and Caitlin McFall contributed to this report.