US Imposes 10% Trade Surcharge on Ecuador – but Major Exports Are Exempt

On July 24, 2026, the United States Trade Representative (USTR) brought into effect an additional 10% tariff on imports from 60 nations under Section 301 of the Trade Act. The move concludes investigations into whether those nations had effective bans on goods produced with forced labor. Ecuador secured the lowest possible surcharge—10%—a reflection of its commitments under the Reciprocal Trade Agreement (ART) with the US. However, according to Ecuador’s exporters federation Fedexpor, 54% of the country’s non-oil exports to the US are exempt from the new levy, thanks to product-specific exclusions.

The exemption list includes fresh bananas, plantains, cocoa beans, instant coffee, roses, other cut flowers, palm oil, plywood, and cork products, among others. These goods will continue to enter the US at their ordinary most-favored-nation rates. Meanwhile, shrimp and pet food, which attract the 10% surcharge, still hold a competitive edge against suppliers from Vietnam or Thailand because of Ecuador’s lower overall tariff burden. The picture darkens for tinned tuna and broccoli: on top of existing regular duties, the extra 10% puts them at a disadvantage relative to Mexican products that enjoy zero-tariff access under the US-Mexico-Canada Agreement (USMCA).

Fedexpor president Xavier Rosero warned that US trade policy remains fluid and called for a stronger Ecuadorian presence in Washington to reinforce political ties and improve market access. For now, the measure gives Ecuador a modest advantage over neighbors such as Colombia, Peru, Chile, Costa Rica, and the Dominican Republic, which face a 12.5% surcharge—but the structural gap for certain processed foods persists.

Why Bananas, Flowers, and Cocoa Are Now Ecuador's Strategic Cushion

Competitive Landscape: Ecuador vs. Its Latin American Peers

The spread between Ecuador’s 10% surcharge and the 12.5% rate applied to Colombia, Peru, Chile, Costa Rica, and the Dominican Republic translates into a 2.5-percentage-point cost advantage for any product where those countries previously competed on equal tariff footing. For top export items that are exempt from the surcharge altogether, the advantage is even larger, but it is the non-exempt products where the difference matters most. Ecuadorian shrimp, for example, now enjoys a lighter cumulative tariff than that faced by Asian rivals, a window that may close if the USTR revises the list.

The Exemption List: Strategic Safety Net for Core Exports

Bananas, flowers, cocoa, and coffee are the backbone of Ecuador’s non-oil export basket. Their exemption from the Section 301 levy shields them from immediate cost inflation and protects established supply chains. However, the mechanism is a political grant, not a permanent right. The exemptions are tied to the same forced-labor compliance logic that led to the investigations, meaning any perceived lapse by Ecuador could prompt their removal. For now, the list acts as a buffer that allows exporters in these categories to focus on volume and quality rather than tariff hedging.

Where the Surcharge Bites: Tuna, Broccoli, and the Mexico Factor

For tinned tuna and broccoli, the 10% surcharge compounds existing ordinary duties. Mexico, while also subject to the 10% surcharge, faces zero ordinary tariffs on these goods under USMCA, making its total import cost lower. Ecuadorian producers in these segments face a stark choice: absorb the duty increase, lose margin, or risk losing US customers to Mexican suppliers. Without negotiated tariff adjustments or product differentiation, the gap is unlikely to narrow in the near term.

Next Moves for Ecuador's Exporters in a Shifting Trade Landscape

  • Exempt product exporters: Confirm strict compliance with forced-labor prohibitions throughout your supply chain to safeguard the exemption status. Use the cost advantage to capture longer-term contracts while competitors face higher tariffs.
  • Shrimp and pet food exporters: Exploit the current 2.5 percentage-point edge over Asian rivals to consolidate market share; invest in branding or quality upgrades to reduce price sensitivity.
  • Tuna and broccoli exporters: Immediately engage US buyers to negotiate shared absorption of the new cost or explore alternative distribution channels. Work through Fedexpor to press for the elimination of ordinary tariffs on these items.
  • Trade bodies and government: Intensify lobbying in Washington to maintain the exemption list and to secure parity with Mexico’s tariff-free access. Monitor any USTR reviews that could alter the product coverage.

Risk & Opportunity Assessment

Commercial RiskMediumThe 10% surcharge directly applies to 46% of Ecuador’s non-oil exports to the US, raising costs for importers of shrimp, pet food, tuna, and broccoli. However, the exemption covering 54% of shipments limits the immediate financial impact.
Competitive RiskMediumEcuador gains a 2.5 percentage-point advantage against Peru, Colombia, and others on surcharged goods, but Mexico’s USMCA zero-tariff access erodes Ecuador’s position in tuna and broccoli. Overall, it creates a mixed competitive outlook.
Regulatory RiskMediumThe surcharge is explicitly tied to forced-labor import prohibitions. If Ecuador’s enforcement record falters, the USTR could raise the surcharge or rescind exemptions. The dynamic nature of US trade policy adds uncertainty.
Reputation RiskLowNo direct reputational risk is apparent, but sustained pressure on forced-labor issues could tarnish Ecuador’s image if violations emerge.
Technology DisruptionLowThe measure is purely tariff-based and unrelated to technology shifts.
Commercial OpportunityHighExempt products such as bananas, flowers, and cocoa can expand in the US market while competitors face higher tariffs. Shrimp and pet food also have a short-term window to grow before rivals adjust.