Can Spain’s key sectors withstand the pressure of shifting U.S. policies? As global trade tensions continue to shift and the tariff situation in the United States evolves, Spanish exporters find themselves walking a fine line.

In 2024, the U.S. accounted for 4.6% of Spanish total goods exports, representing 1.1% of Spain’s GDP. That makes America Spain’s sixth-largest export market, a respectable position but far from dominant. This relatively low dependence offers Spain a degree of insulation from tariff shocks compared to European heavyweights like Germany and Italy, whose industries are deeply intertwined with U.S. trade.

However, resilience doesn’t equate to immunity. Spain runs a trade deficit with the U.S., and any new tariffs could ripple through its economy indirectly. Why? Because Spain’s main European partners, Germany, France, and Italy, are deeply tied to U.S. trade. Disruptions in their supply chains could cascade into Spain’s export performance, creating secondary effects that are harder to predict. In today’s interconnected economy, even modest exposure can become vulnerability.

Sector Spotlight: Where the U.S. Matters Most

While Spain’s overall exposure to the U.S. market is limited, certain sectors lean heavily on American buyers. Industries such as non-metallic minerals (cement and ceramics), chemicals, pharmaceuticals, machinery, and electric machinery have a stronger U.S. footprint. These sectors are feeling the pinch of the trade war, especially given their reliance on complex supply chains and high-value components.

The agrifood sector, broadly speaking, enjoys lower U.S. exposure, but there are exceptions. The olive industry stands out as particularly vulnerable. The U.S. is Spain’s top export market for table olives (21% of total in 2024) and its second largest for olive oil (16%). This isn’t new territory: During U.S. President Donald Trump’s first term in office, tariffs of 25% on olive oil and 35% on table olives hit Spanish producers hard. Exports of table olives to the U.S. plunged nearly 20% in the three years following the mid-2018 tariffs, compared to 2017 levels. The U.S. share of Spanish olive exports dropped from 26% in 2017 to below 20% in 2022, before rebounding slightly to 21% last year.

Wine producers also have skin in the game. The U.S. ranks as Spain’s second-largest wine export market, representing 11% of total wine exports. For premium Spanish wines, the American consumer base is not just lucrative, it’s strategic. Losing ground here could mean ceding market share to emerging players like Chile.

Agriculture’s Recovery: A Silver Lining

After years of drought-induced strain, Spain’s agricultural sector is finally regaining momentum. Improved weather conditions have fueled a rebound, with food and beverage production rising by an average of 1.2% in the first eight months of the year compared to 2024, returning to pre-pandemic levels. This recovery is more than symbolic; it strengthens Spain’s ability to absorb external shocks.

Energy-related inflationary pressures, exacerbated by the war in Ukraine, have eased, stabilizing input and producer prices. However, these costs remain historically high, keeping margins tight. On the domestic front, consumption is back: food retail sales now exceed 2019 levels by 5% in volume, signaling a recovery from the inflationary crisis. For agribusiness leaders, this rebound offers breathing room to strategize for potential tariff headwinds.

Why Tariffs Matter Now

The renewed focus on tariffs is not happening in a vacuum. For Spain, the challenge is twofold: direct exposure to U.S. tariffs and indirect exposure through European partners.

Moreover, tariffs often trigger retaliatory measures. Tensions aren’t strictly reserved to trade.

Strategic Implications for Spanish Businesses

In October, President Trump publicly threatened trade penalties against Spain, citing its refusal to raise defense spending to 5% of GDP in a move he called disrespectful to NATO. His comments included the possibility of punitive actions through tariffs, underscoring how quickly political disputes can spill into economic consequences. What does this all mean for Spanish exporters? First, diversification is no longer optional, it’s imperative. Companies heavily reliant on U.S. markets, particularly in olives, olive oil, and wine, should accelerate efforts to expand into Asia-Pacific and Latin America, where demand for Mediterranean products is rising.

Second, supply chain agility will be a competitive advantage. Firms that can pivot sourcing and logistics quickly will weather tariff storms better than those locked into rigid structures. Digitalization and nearshoring strategies could play a critical role here.

Finally, branding matters. Spanish producers have long leveraged quality and heritage as selling points. In a tariff-heavy environment, these attributes can justify premium pricing and help offset cost pressures.

The Bigger Picture

Spain’s relatively low direct reliance on U.S. trade offers resilience, but sector-specific vulnerabilities, especially in olives, olive oil, and wine, cannot be ignored. As tariff risks loom, Spanish exporters may need to rethink market strategies and strengthen operational flexibility. For now, the country’s agricultural revival and robust domestic consumption provide a much-needed cushion against external shocks. But in a world where trade policy can shift overnight, complacency is not an option.

Laurine PIVIDAL is the southern Europe economist for Coface, a global leading player in trade credit risk management. Coface leverages its unique expertise and cutting-edge technology for 100,000 clients across some 200 markets. For almost 80 years, they’ve been supporting the growth of companies, helping them navigate in an uncertain and volatile environment.

Boilerplate:

As a global leading player in trade credit risk management, Coface leverages its unique expertise and cutting-edge technology for 100,000 clients across some 200 markets. For almost 80 years, we’ve been supporting the growth of companies, helping them navigate in an uncertain and volatile environment. At Coface, we act for trade.