Michael Smurfit, the now 88-year-old who was the driving force behind the development of Ireland’s first multinational, was one of the first buyers of an apartment in Donald Trump’s Trump Tower in the mid-1980s and dined with his neighbour, four floors removed, several times.
If only his son Tony, who took the Smurfit name to the next level in the global packing last July by merging the Smurfit Kappa Group with US rival Westrock, had such access.
He’d surely have something to say about the trade policies of Trump 2.0.
Smurfit jnr, chief executive of Smurfit Westrock, found himself being asked by analysts on Wednesday, as the group reported quarterly results, about potential costs of Trump’s potential tariffs on operations Mexico and Canada.
The impact could be material – but it ultimately depends on whether they come into force or, if they do, how long they would last.
The US president said over the weekend – in a pre-Super Bowl interview with Fox’s Bret Baier – that Mexico and Canada had not done enough to boost border security to avert steep tariffs on exports to the US, which he had agreed on February 3rd to pause for 30 days.
“Something needs to happen and [the current situation is] not sustainable,” he said.
The group’s Mexican operations face the largest risk, even if this is indirect. The US imports a large amount of consumer goods and foods from there, and there is a fear the impact of tariffs on end products may cause packaging demand to decline. Will US consumers having to pay 25 per cent more for Mexican avocados, oranges, apples and pears turn them off such products?
“We’ll have to wait and see,” Smurfit said on the analysts call.
Smurfit Westrock has one mill in Canada that exports packaging products to the US. Tariffs here would have a direct impact on that business. “That would be very uncompetitive very quickly,” said Smurfit.
