Originally published July 22, 2025, on New Hope Network by Mark Hamstra.

As the U.S. continues to negotiate and alter complicated global trade agreements the threat of new and changing tariffs lingers for many imported products. The potential risk of increased costs for U.S.-based companies in the organic industry remains elevated.

In an effort to rectify global trade imbalances and encourage more domestic production, President Donald Trump’s administration earlier this year unveiled a sweeping plan to implement so-called ”reciprocal tariffs” on imported products from dozens of countries. In addition, a 10% tariff on almost all imports was established. The reciprocal tariffs were scheduled to take effect July 9. This deadline was extended to August 1, to give countries time to negotiate. As deadlines come and go and continue to change, trade policies remain volatile.

Trade groups representing the organic industry have been working to secure tariff exemptions for key products and ingredients that the industry relies on. In many cases there are few if any domestic sourcing alternatives for these items.

The administration in April published a list of pharmaceutical ingredients, vitamins and minerals that are currently exempt from reciprocal tariffs, but those exemptions are still subject to review and could change. Many companies in the organic industry are hopeful that the administration’s focus on health and wellness, as reflected in its Make America Healthy Again initiatives, will influence its final decisions.

No specific exemptions for organics

As of late June, the administration had not granted any specific exemptions for organic products, says Tom Chapman, co-CEO of the Organic Trade Association.

“Currently, the likelihood of securing exemptions for food and agricultural products is very low,” he says. “However, companies should be educating their members of Congress about how tariffs are impacting their businesses and working with trade associations to share cost impacts and leverage collective advocacy.”

Chapman notes that products not produced domestically, such as cocoa, coffee and spices, may be stronger candidates for future exemptions, especially if they are further processed in the U.S.

“While an individual exemption path may not exist under the [International Emergency Economic Powers Act] tariff authority, collective pressure through Congress and trade associations remains the most effective advocacy strategy,” he says.

Saumil Maheshvari, senior VP of Business Development at Orgenetics, an importer of organic ingredients from around the world, says Orgenetics’ leadership has been working closely with the OTA on tariff exemptions. The company’s flagship line of organic, plant-based vitamins and minerals are produced in both East Africa and India, so those regions have been areas of particular focus, he says.

NPA also remains active

Jim Emme, CEO of NOW Health Group and newly appointed chairman of the Natural Products Association, says NOW and the NPA continue to work with the White House and the Department of Commerce to minimize the impact of tariffs on the industry. NPA leadership met with White House staff in March and presented a list of items to consider for exemption. That list influenced the adoption of most of the natural ingredient items that ended up on the tariff exemption list, called Annex II, that was released in April, Emme says.

“We didn’t get every exemption we requested on that list and have since resubmitted many new ingredient items along with the previous ones that did not gain relief,” he says. “Our work is never done in this area.”

In addition to vitamins, Emme cites Coenzyme Q10 and amino acids as among the key ingredients that have currently been granted exemptions.

Leaders of NOW, which manufactures and distributes natural foods, dietary supplements and other products, have also been in discussions with key vendors to negotiate relief from price increases due to tariffs, Emme says. The company has also hired legal counsel to help it identify which ingredient sources comply with the tariff exemptions, and Emme suggests that other companies seeking to minimize their tariff burden should do the same.

“The interpretations of the tariff schedules are sometimes very complex, so we chose to get additional expert advice while we advocate to the decision makers through our membership in NPA,” he says.

Bright Pharma scraps tariff-avoidance plan

Patrik Barr, co-founder of Bright Pharma Caps, imports organic pill capsules made of pullulan from China. Bright Pharma’s are the world’s first National Organic Program (NOP) certified organic pullulan capsules. Pullulan is a polysaccharide polymer used in manufacturing dietary supplement capsules.

Derived from the fermentation of starch, the availability and integration of USDA Organic certified pullulan into organic encapsulated products has been key to increasing the availability of organic dietary supplements and meeting the growing consumer demand for healthy products made with clean, traceable ingredients while maintaining a focus on organic integrity and sustainability.

Pullulan has been on the National Organic Standards Board’s (NOSB) national list of ingredients allowed to be used in organic products in a non-organic form because an organic form did not exist or was not available in supplies needed to meet market demand. Bright Pharma filled that gap with an organic option for encapsulation, allowing brands to create a 100% organic product from filling to capsule.

Now, with the market and their business growing, Barr is trying to navigate tariffs for this unique product. He had a plan to minimize the impact of tariffs but has since opted to increase prices on his products to help cover tariff costs. He had considered importing a large volume of capsules to Canada and storing them there to wait out evolving tariff negotiations, but the company ran into some challenges finding a suitable storage site, he says.

Meanwhile, Barr has written to lawmakers in Congress pleading his case for exemption because of the unique nature of the Bright Pharma organic capsules.

“A lot of American companies have built their whole structure based on using these organic capsules, including a big customer here in Oregon, and if we raise the price because of tariffs, a lot of people are going to lose their jobs,” he says he told the members of Congress. “We should be granted an exemption because there are no other options.”

Barr has not heard back from any of the lawmakers, he says.

Tariff strategies for organic companies

Tom Chapman, Co-CEO of the Organic Trade Association, offers the following suggestions for companies seeking to minimize their tariff exposure:

  • Monitor trade negotiations: Sourcing from countries engaged in active negotiations with the U.S. may reduce risk. Additionally, advocating with suppliers to support these negotiations with their own national governments can be helpful.
  • Diversify sourcing: While the baseline tariff is 10%, some countries face rates of up to 50% or more. Companies should consider re-sourcing from countries with lower tariff rates, if available.
  • Consider USMCA: Canada and Mexico are currently exempt under the U.S.-Mexico-Canada Agreement and may offer some protection—though it’s worth noting that USMCA is up for review in 2026, which could reintroduce tariff risk.
  • Onshore production: Bringing manufacturing or even some value-add processing back to the U.S. can help reduce exposure.
  • Negotiate cost-sharing: Importers should consider working with suppliers to share tariff-related costs, so the burden is not entirely borne by the U.S.-based buyer.
  • Advocate for trade agreements: Continued outreach to policymakers emphasizing the costs and disruptions caused by tariffs can help push for trade solutions.

Nuherbs faces few options

Wilson Lau, CEO of Nuherbs,  which specializes in importing herbs—including organic herbs—from China, says his company’s options to minimize the costs of tariffs are limited. Nuherbs has explored potential sourcing alternatives, but Lau says other countries often lack the infrastructure to grow the herbs that the company seeks. In addition, the subtle flavor and other attributes of the crops—similar to the terroir of coffee or wine—can also differ from region to region.

“There’s a reason why some use Chinese ginger versus Indian ginger,” Lau says as an example. “There’s a reason why people have preferences for different spices from different regions.”

Changing supply chains can also be a risky, complicated and costly undertaking, particularly for a small company, he says.

“Just because you save 10%, or whatever the difference in the tariff rates is, you still have to do all the work of verifying and validating the suppliers and product testing,” says Lau. “You have to look at the total cost of ownership.”

One option that small organic companies can pursue is to examine the classifications of all of the products that they import to ensure that they are being levied with the appropriate tariffs, he says. For example, if a product is being classified as “tea” when it really is “tea extract,” which may be subject to a lower tariff, that could present an opportunity to eke out some savings, he says.

“However, it has to be legal, and it has to be something that you weren’t previously doing correctly or with specificity,” says Lau.

Concern for the future

A key concern of the industry going forward is that many of the products on the Annex II list of tariff exemptions published in April will in the end not be exempted and will instead be subject to Section 232 tariffs—imposed by the U.S. Department of Commerce for national security reasons—which would make them much harder to eliminate, says Loren Israelsen, founder and president of the United Natural Products Alliance.

“There’s a lot of concern within the supplement industry that most of those exclusions that we enjoy at the moment are going to get hit with a nasty, new tariff,” he says. “Typically, that’s 25%, but most everyone thinks it’s going to be quite a bit higher than that.”

The organic industry should be encouraged, however, by the attention that the MAHA movement, led by Robert F. Kennedy Jr., secretary of the U.S. Department of Health and Human Services, is giving to the U.S. food supply and to the need to transition away from the use of harmful ingredients. That could lead the administration to encourage organic production and access to organic and regeneratively farmed ingredients, he says.

The results of tariff negotiations between the U.S. and China are vital to the future of the nutritional supplement industry, says Israelsen. China will likely continue to leverage its near-monopolies on the production of certain critical products—such as rare earth minerals and many nutritional supplements—in its trade negotiations with the U.S., he says.

“We’re in a period of very high uncertainty,” says Israelsen. “We would all like to see it resolved as soon as possible, but the scale at which the administration is attempting to rebuild the global tariff system has never been attempted. This is new territory.”