President Donald Trump’s trade war is focused on reversing the American trade deficit, reducing the money Americans spend to buy products from overseas while increasing domestic manufacturing.
But some states already have a trade surplus, which means the value of their exports exceeds the value of what they buy from other countries.
That includes Oregon, which shipped $34 billion in products to destinations around the world last year, according to federal data. It’s $6 billion more than Oregon imported in 2024.
Oregon’s robust exports have long been among the state’s key economic strengths, but the trade war could undercut that.
China and the European Union have already imposed retaliatory tariffs in response to the Trump administration’s new import taxes. That will make products grown or manufactured here more expensive overseas. It could prompt customers in other countries to shift away from Oregon products, like semiconductors made in Hillsboro, in favor of alternatives made elsewhere.
New tariffs could also raise the cost of doing business for Oregon firms that rely on products, equipment or raw materials from other countries.
Even after Trump backed down on levying many tariffs this past week, he left in place a base tariff of 10% on most countries — with a 25% tariff on some products from Canada and Mexico (those not covered by a prior free trade deal), and an extraordinary 145% tariff on products from China.
The tariffs currently in force would have totaled nearly $7 billion if levied on goods Oregon imported last year, according to state calculations, increasing the aggregate cost of those products by roughly 25%.
“A U.S. tariff, it’s much like a sales tax, really,” said Nathan Buehler, spokesperson for Business Oregon, the state’s economic development department. It raises the cost of products that local businesses import from overseas.
“They’ve got to pay that. That’s tough to adapt to something like that in your profit margins for your product,” Buehler said. “So that cost would then likely be passed on to consumers.”
The impact of the tariffs will vary considerably among businesses, as companies seek locally made alternatives or scale back operations in response to higher costs. A look at Oregon’s biggest trading partners can help gauge the dynamics.
Oregon does more business with China than any other country, importing $2.7 billion of Chinese products and selling nearly $6 billion in products there. That likely reflects Oregon’s large electronics manufacturing sector, which accounts for more than half the state exports.
Intel has a large packaging and testing site in the western Chinese city of Chengdu. Trade data suggests many of the microprocessors Intel makes in Hillsboro end up there for the next step in the production process, while semiconductors made by other Oregon chipmakers go to manufacturers elsewhere in China.
In retaliation for Trump’s new tariffs, China has levied a 125% tariff on U.S. products. That could significantly raise the cost of the advanced microprocessors Intel makes in Hillsboro, which power PCs and laptops sold all over the world, or prompt Intel to shift production from Oregon to its factories outside the U.S.
Intel shares have been sliding since Trump unveiled his tariffs at the beginning of the month, dropping about 12%. (The company also has a large assembly and test operation in Malaysia, another major destination for Oregon exports.)
Canada and Mexico are Oregon’s next-largest trading partners, each with about $7.1 billion in products shipped in or out.
Oregon has a $5.5 billion trade surplus with Mexico, with top exports including vehicle parts, industrial equipment and rubber products. Trade data doesn’t break out results for individual companies, but Daimler Truck North America and Precision Castparts factories in the Portland area sell their products in Mexico, among other countries.
Trucks, wood products and crops are Oregon’s largest exports to Canada. Many imports from Canada are fertilizers, passing through the Port of Portland en route to destinations elsewhere.
Oregon imports $4.7 billion in products from Japan, far more than it sells there. Most of these imports are cars – tens of thousands of Toyotas pass through the Port of Portland every month on their way to dealers all over the U.S. While Trump revoked most of his new tariffs, he left in place a blanket 25% tariff on auto imports.
The trade war is buffeting businesses large and small. Business Oregon is focused on tallying tariffs’ impacts, Buehler said, and expanding eligibility for trade assistance programs aimed at smaller manufacturers.
Those programs help teach businesses about operating internationally to help them expand their markets. But Buehler said those resources won’t overcome the fallout from a global trade war.
“We obviously can’t offset the impact,” he said, “when you’re talking about billions of dollars.”
This is Oregon Insight, The Oregonian’s weekly look at the numbers behind the state’s economy. View past installments here.
-- Mike Rogoway covers Oregon technology and the state economy. Reach him at mrogoway@oregonian.com.
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