Swiss chocolate maker Lindt & Spruengli will supply chocolate made in Europe – rather than the US – to Canada.
This move aims to avoid Canadian tariffs imposed on the US to counter higher custom duties imposed by US President Donald Trump.
Trump announced new 25% tariffs on imports from Mexico and Canada taking effect from Tuesday, with Canadian Prime Minister Justin Trudeau saying Ottawa would respond with immediate 25% tariffs.
Lindt produces 95% of the chocolate it sells in the US at its five factories in the country, which also supply Canada and could be affected by the US tariffs.
CEO Adalbert Lechner said Lindt was taking action to prevent its business in Canada, one of its top ten markets, from being caught in the cross fire of the trade conflict.
After Lindt reported its full-year results, Lechner said, “The volumes that we source currently for Canada can all be shifted to Europe.”
At present, 50% of the company’s chocolates in Canada came from the US, with the rest coming from Europe.
Lechner told Reuters, “We are able to source 100% from Europe.”
Lindt – whose products include Lindor chocolate balls – has already built up inventories in Canada from the US to give it time to change its supply chain, which it expects to complete by the middle of the year.
Chief financial officer Martin Hug said it would be slightly more expensive to transport chocolate to Canada from Europe but it would cost less if than if tariffs were imposed.
Products produced in Europe could also face less of a consumer backlash in Canada than chocolates labelled as made in the US, Hug said.
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