Chile Seeks to Exempt Salmon, Fruit and Wood from 12.5% U.S. Tariff After Sending Product List to USTR

Government Seeks to Shield 40% of Exports from U.S. Tariff

Chile's government is moving aggressively to protect key exports after the U.S. imposed an additional 12.5% duty on about 40% of Chilean shipments not already covered by the bilateral free trade agreement. The tariff stems from an investigation by the Office of the United States Trade Representative (USTR). Foreign Minister Francisco Pérez Mackenna met with the country's leading business federations to coordinate a response, and a formal list of products Chile wants exempted has already been submitted to Washington.

The government's plan is to have the excluded products—fresh fruit, salmon and wood, among others—added to the “Annex A” list of the USTR investigation, which would shield them from the levy. Subsecretary of International Economic Relations Paula Estévez said Chile provided economic information showing that these goods are complementary to the U.S. economy and do not harm domestic production. She confirmed on-line negotiations are underway this month and that a U.S. delegation, including its ambassador, is expected to visit Chile.

Export-oriented business leaders laid out the potential damage. Chilean salmon exports to the U.S. reached $2.6 billion last year; a flat 12.5% tariff would add roughly $300 million in costs. Fresh fruit shipments, worth $2 billion, would face an additional $300–$400 million hit. Iván Marambio, president of Frutas de Chile, argued that the fruit imports support over 19,000 seasonal jobs in the U.S. and contribute $4 billion to U.S. GDP each season, a point Chile intends to deploy in talks.

Chancellor Pérez Mackenna stressed that the existing free trade pact already covers 60% of bilateral trade at zero tariff, but acknowledged the remaining 40% requires a diplomatic push. “Things are not black or white. They are what they are, and we are working to make them even better,” he said after the meeting.

Behind the Negotiation: Why Chile Thinks It Can Win an Exemption

How the USTR Tariff Hits Chilean Exports

The 12.5% duty falls on goods that were excluded from the original free trade agreement and are now caught by a USTR investigation. While 60% of Chilean products enter the U.S. duty-free, the remaining 40%—concentrated in agriculture, fisheries and forestry—now face a significant cost increase. The Chilean government’s immediate goal is to get these products transferred to Annex A of the investigation, which would restore their zero-tariff access. Talks are at a critical juncture, with on-line meetings this month and a possible in-person visit by a USTR team.

The Economic Argument: Complementarity, Not Competition

Chile’s case rests on the claim that its targeted exports are complementary to the U.S. economy. Salmon farming in the U.S. is minimal, so Chilean salmon does not displace domestic output. Fresh fruit arrives during the Northern Hemisphere’s off-season, filling supply gaps rather than competing with local growers. Wood products similarly serve niche demands. By framing the goods as supportive of U.S. consumer choice and downstream employment, Chile hopes to weaken the USTR’s rationale that the imports undercut American producers.

The Numbers That Are Driving Urgency

Industry figures put the combined direct cost of the tariff at more than $600 million per year. Salmon alone would cost exporters an extra $300 million, while fruit shipments could see $300–$400 million added. Those sums dramatically compress margins in industries already squeezed by rising input, energy and freight costs. The scale of the impact has made high-level diplomacy essential; the Chancellor’s earlier meeting with U.S. Secretary of State Marco Rubio helped open the channel now being used for the USTR negotiation.

What Happens If the Exemption Fails

A failure to secure the exclusion would permanently raise the cost of Chilean goods in the U.S. market, pushing importers toward alternative suppliers. The salmon and fruit sectors would likely accelerate diversification into Asia and Europe, but shifting established supply chains takes time. Moreover, the tariff carries a reputational shadow, given its origin in an investigation that—though not explicitly labeled in today’s discussions—may relate to labor practices; any stigma could complicate Chile’s broader trade diplomacy.

What the Tariff Standoff Means for Chilean Exporters

• Use the U.S. job and GDP contribution data highlighted by the fruit industry. Quantifying that Chilean fruit supports 19,000 seasonal jobs and adds $4 billion to U.S. GDP per season strengthens the argument that the tax hurts Americans, not just Chileans.
• Stress the complementarity of the targeted products in all written submissions and meetings. Emphasize that salmon, off-season fruit and specialty wood do not compete with domestic U.S. output, directly challenging the rationale for the tariff.
• Prepare for two outcomes in parallel: engage U.S. buyers on potential cost-sharing if the tariff stays, while fast-tracking market access negotiations with Asian and European partners to reduce long-term exposure to the U.S. market.
• Coordinate with business associations to present unified, data-driven testimony when the USTR delegation visits Chile, ensuring each sector can demonstrate the practical harm and the minimal displacement of U.S. production.