As the latest wave of US tariffs rattles global supply chains, GraceKennedy Limited (GK) — a titan of Caribbean commerce with deep roots in food production and financial services — is deploying a multi-pronged defence strategy to shield its $167-billion revenue empire.

The conglomerate, which derives over 70 per cent of earnings from its food division, faces heightened risks as US President Donald Trump’s 20 per cent levies on Chinese imports and sweeping duties on Canadian/Mexican goods threaten to disrupt raw material flows, inflate costs, and erode competitiveness under critical trade pacts like the Caribbean Basin Initiative (CBI).

Fresh off a record 2024 performance which saw net profits reaching $8.9 billion, GK’s leadership is racing to rewire supply networks, leveraging nearshoring opportunities and strategic inventory buffers to counter what is fast becoming the most complex trade landscape in decades.

“The imposition of tariffs on imports into the United States may have an impact on the Group given its possible inflationary effect from higher raw material and finished goods costs,” GraceKennedy said in its audited financial statements released Friday.

“The GK Foods division is particularly susceptible to the increase in cost on both the demand and supply side,” it continued. “If the US moves ahead with the plan to impose reciprocal tariffs, this may affect preferential tariff arrangements for the Caribbean region under the Caribbean Basin Economic Recovery Act which may make products exported to the US less competitive. Supply chain disruptions may also be exacerbated by longer processing times associated with the complexities of the new tariff regimes,” it warned shareholders.

Officials at GK up to press time were not immediately available for additional comment on the likely impact of the tariffs on the company, its raw material supplies and the market for its products.

However, in its audited financials, GK said it is in the process of “assessing the impact of the various proposed tariff structures on its business and will, among other activities, onboard alternative suppliers to diversify its supply chain, near-shore source raw materials, diversify its product mix, implement strategic inventory management plans, cost saving and competitive pricing strategies to offset costs.”

“The group has a robust risk management framework and has taken a proactive measure to identifying, assessing and developing risk response strategies to the potential impact,” the directors however noted.

Yet, it is no passive victim in the story. GK’s 2024 financial disclosures reveals a war chest fortified by $22.7 billion in cash reserves, enabling the company to undertake aggressive pivots like alternative supplier onboarding, as done by some companies in other countries.

As the latest trade wars echo Trump’s 2018–2019 clashes with Beijing and Ottawa — which saw GK at that time absorbing a 7 per cent profit dip from soybean tariff fallout — the conglomerate’s playbook now blends geopolitical agility with vertical integration.

The recent policy in fuelling tit-for-tat spats among some of the world’s largest trading partners, has not only sparked global fear but also comes at a time when inflation continues to hang in the balance, reducing economic output and tightening market conditions for consumers and businesses alike.

“Inflationary pressures may prompt central banks to raise interest rates or halt rate cuts, which could increase borrowing costs. The group will [however] leverage its borrowing options to minimise the cost of funding,” the directors further said.

GK’s business after navigating a range of issues spanning natural disasters, supply chain disruptions and a raft of leadership changes during its 2024 financial year, still managed to deliver strong results. At the end of the 12 months ended December 31, 2024, total revenues for the large conglomerate stood at $167 billion — $131.7 billion or the majority of which flowed from the food division.

With positive performances coming from both its domestic and international food businesses important subsidiaries such as its World Brands Services and Consumer Brands Limited, Hi-Lo Food Stores, Dairy Industries Jamaica Limited (DIJL), Grace Foods Processors (NALCAN) and Unibev subsidiaries all surpassed targets to deliver commendable results.

Over on the financial side, the company despite witnessing slight reductions in money services revenue, owing to lower transaction activity and a decline in remittance flows across key markets, was also able to push-up annual earnings, after stronger sales from the banking and insurance portfolios flowed from a number of subsidiaries including First Global Bank, GK Capital Management, GK General Insurance Company Limited (GKGI), and Canopy Insurance.

The insurance segment, which made the second-largest contribution to group revenues following foods, accounted for $17.5 billion of the amount followed by $10.9 billion from the banking and investments segment and $8.6 billion from money services.

“Our strong performance in 2024 reflects the GK team’s unwavering commitment to delivering our products and services at the highest standard. Despite challenges in some markets, we achieved steady growth across our core businesses, remaining agile and resilient. I am optimistic about what lies ahead for GK as we enter 2025. Our team remains focused on expanding our footprint, strengthening our brands, and unlocking long-term value for our shareholders,” James said in the report to shareholders.

The group, after delivering over $2.35 billion in dividend payments in 2024, said it is now getting ready to on April 7 makes payouts of $0.55 per stock unit or over $543 million in first round 2025 payments to shareholders.

In 2024 GK realised increased revenue of $167 billion and net profit of $8.9 billion.