Mexico celebrated Thursday having dodged the latest round of tariffs from the White House taking aim at dozens of U.S. trading partners around the world, but was also quickly reminded that in a global economy the effects of uncertainty can’t be entirely avoided.

President Claudia Sheinbaum said the free-trade agreement signed by Mexico, Canada and the U.S. during Trump’s first administration had shielded Mexico.

Now her government will focus on the existing 25% U.S. tariffs on imported autos, steel and aluminum, while accelerating domestic production to safeguard jobs and reduce imports.

“During my last call with President Trump, I said that, in the case of reciprocal tariffs, my understanding was that there wouldn’t be tariffs (on Mexico), because Mexico doesn’t place tariffs on the United States,” Sheinbaum said.

Economy Secretary Marcelo Ebrard noted that despite having free-trade agreements with the U.S., many countries were targeted by the tariffs U.S. President Donald Trump announced Wednesday on what he dubbed “Liberation Day.” Trump framed the tariffs as a way to bring manufacturing jobs back to the U.S.

Noting that Mexico dodged the latest round of tariffs, Ebrard said swaths of Mexican exports including agricultural products like avocados, clothing and electronics will continue to enter the U.S. without import duties.

Sheinbaum, meanwhile, encouraged companies producing in Mexico who had not been exporting under the free-trade agreement for various reasons to take the necessary steps to qualify. She cited major German auto producers as an example.

Qualifying for the free-trade agreement could involve anything from doing paperwork to making adjustments to the sourcing of a product.

Despite Trump’s latest tariffs not being imposed on Mexico, the uncertainty they created and the interconnectedness of the North American auto supply chains meant it didn’t take long for the effects to touch Mexico.

Stellantis, maker of auto brands including Dodge and Jeep, announced that it would pause production at its assembly plant in Toluca west of Mexico City for the month of April while it assesses the tariffs’ impact on its operations. A similar temporary production halt was scheduled for an assembly plant in Canada and some 900 workers were to be temporarily laid off across several plants in the United States.

That uncertainty is part of the reasons why Sheinbaum is pushing Plan Mexico, an initiative to promote and cultivate more domestic production.

As an example, she cited a collaboration between her government, local universities and Mexican companies Megaflux and Dina to produce electric buses for public transportation.

Ebrard said recently that the buses represent not only a technological advance in Mexico, but also a “strategic decision” in favor of Mexico’s industrial sovereignty.

At a factory in Mexico City, the electric buses called Taruk — trail-runner in the Indigenous Yaqui language – are already in production. Megaflux Director General Roberto Gottfried said the company hopes to deliver some 200 by year’s end.

He noted that some 70% of the Taruk’s components are produced in Mexico, including its motor, but the lithium batteries that power them come from China.

In a country where one out of every three people use public transportation every day, developing this sector domestically is critical, Gottfried said.

Despite the global economic challenges presented by the uncertainty caused by tariffs, he said, Mexico’s large internal market gives the initiative a competitive advantage to develop and weather the storm.

This story was originally featured on Fortune.com

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President Donald Trump touted the idea of Americans paying less than $3 a gallon for gasoline during his tariff rollout speech. And even while crude oil markets are slumping, costs for the fuel have remained stubbornly above that level and look set to remain that way — at least for now. 

“Gasoline is way under $3, and people are beginning to be able to buy things and live again,” Trump told an audience in the White House’s Rose Garden Wednesday afternoon. But average US gasoline prices measured by the American Automobile Association were $3.26 a gallon as he delivered the speech, 13 cents higher than when he took office on Jan. 20. Gasoline hasn’t cost US drivers less than $3 a gallon on average since 2021, when the US economy emerged from the depths of the Covid—19 pandemic that decimated travel demand.

Trump’s new levies did, however, have an immediate effect on futures markets for fuel. Gasoline futures tumbled as much as 8.2% and diesel futures fell as much as 7% on Thursday as part of a broader rout. Crude futures in New York slumped as much as 8%.

Though oil prices are the biggest factor in the cost of producing a gallon of gasoline in the US, declines in the futures market don’t usually bring immediate relief to consumers at the pump, especially with peak demand season just around the corner.

Refiners get to decide how much of a discount they will factor into what are known as rack prices, the amount they charge fuel sellers like gas stations and wholesalers. Those producers and fuel sellers have little incentive to drop pump prices based on one day of trading in the volatile futures markets, especially since they’re now enjoying better margins. A more sustained decline for crude, though, could eventually trickle its way through into retail gasoline. 

But meanwhile, the US is heading into peak driving season, which lasts from May’s Memorial Day holiday week through Labor Day in September, when Americans hit the road for summer vacations. Fuel demand and prices often rise in this period as demand increases and refiners switch to making a more expensive gasoline grade in the warmer weather to meet emissions regulations.

Some consolation for drivers is that fuel prices, while unlikely to fall below $3 for gasoline, are cheaper now than they have been in the last three years in the run-up to the summer. Gasoline prices on Wednesday, as Trump took the podium, were about 30 cents a gallon cheaper than the same day of 2024.

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Coffee in the US risks getting even more expensive as President Donald Trump’s sweeping tariff measures hit Vietnam, one of its biggest suppliers, with hefty levies.

The Southeast Asian nation is the world’s leading producer of robusta coffee, the variety used in instant drinks and espressos. The 46% tariff on Vietnam’s goods — among the highest of the rates Trump imposed against US trading partners — threatens to disrupt flows and comes as coffee costs have already soared on the back of harvest shortfalls.

New York futures for arabica, the high-end variety used in coffee shops, have held near a record high after adverse weather hit key growing regions. Supply shortfalls also pushed robusta futures in London up more than 40% over the past year. 

On Thursday, the most-active contract for robusta fell as much as 2.5%, while arabica futures dropped as much as 3.1%. Both contracts pared most of those losses by the market settle.

“The tariffs will likely add to coffee market volatility and could exacerbate existing supply tightness,” said Priyanka Sachdeva, senior market analyst at brokerage Phillip Nova Pte. in Singapore. “US coffee prices could rise, especially for robusta-based products.”

Nguyen Nam Hai, chairman of the Vietnam Coffee and Cocoa Association, said he was “stunned” to see such a high tax rate against the nation. “Everyone is worried, especially about the signed export contracts,” he said by telephone.

Still, the country ships a lot to other regions like the European Union, helping to temper the impact. 

While there has been an incentive to use the cheaper robusta variety, the world’s top arabica grower Brazil has been hit by a lower 10% baseline tariff. That potentially makes arabica a more appealing option, said Steve Wateridge, head of research at TRS by Expana.

“The fact that all the main arabica producers seem to be at a 10% tariff rate, whereas Vietnam and Indonesia are much higher, there may be a change in the flow as there’s an incentive to use more arabica or Brazilian Conilon,” he said.

But for US buyers, alternatives are limited, with Vietnam its third-biggest supplier. Stocks in the US already have little room for further drawdowns and will likely remain low with the tariffs in place, said Daryl Kryst, vice president of Soft and Agricultural Commodities Asia for StoneX Group Inc.

Although some importers may try to increase purchases from Brazil, Indonesia and Ivory Coast, those countries cannot fully replace Vietnam’s high volume and consistent quality, Sachdeva said. And some of them were hit by steep tariffs too.

Switching to arabica may also not be viable as robusta is critical for instant coffee and espresso, she said. The tariffs will make it “even harder for US buyers to secure affordable robusta, leading to potential shortages,” she said.

Other soft commodities also broadly fell, with the exception of New York cocoa prices that rose as much as 5.8% after the US announced tariffs on top grower Ivory Coast. Cotton futures dropped as much as 4.4% on fears of weaker demand, reaching its exchange limit. Orange juice prices, meanwhile, sank 6% intraday.

Robusta futures dropped 0.22% in London to reach $5,388 a ton, while arabica fell 0.93% in New York. New York cocoa rose 3.6% in New York, while London futures fell 1.4%. Cotton sank 4.4% in New York.

This story was originally featured on Fortune.com

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