Canadian Cattle Association calls for diplomatic solutions in face of potential tariffs

In conversation with media after his inauguration on January 20, U.S. President Donald Trump reportedly suggested a 25 per cent tariff on all products imported into the United States from Canada could be announced as soon as February 1. 

 The Canadian Cattle Association (CCA) is expressing disappointment over the comments.  

“The United States and Canada have the largest two-way trade in live cattle and beef in the world with significant numbers of Canadian cattle sent to packing plants in the United States for processing and returned to Canada as beef for retail sale,” says CCA President, Nathan Phinney.

Tariff trouble: What it means for Canadian cattle producers

“Also, American-born cattle are fed in Canadian feedlots before returning to the United States for processing. Tariffs would greatly increase the cost of processing cattle and ultimately the cost of beef on both sides of the border.” 

Phinney emphasizes that the Canadian beef industry strongly supports free and open trade. He expects trade agreements to be respected and honoured, noting that international trade progresses through negotiation and compromise, as seen with the NAFTA revision by President Trump.  

The CCA, along with other industry representatives, plan to work with the Government of Canada and partners on both sides of the border to prevent the announced tariff coming into force on live cattle and beef. 

Alberta Beef Producers is also working with industry and government representatives to ensure agriculture is part of the discussion. 

“Agriculture is not only a cornerstone of Alberta’s economy but also plays a significant role in Canada’s overall prosperity,” says ABP Chair Brodie Haugan. “We are thankful for the ongoing efforts of Premier Danielle Smith and Minister RJ Sigurdson in advocating for our industry.  Prioritizing agriculture in trade discussions is crucial for farmers, ranchers, and consumers.”  

CCA: Canadian Beef Producers Extremely Disappointed by Proposed Tariffs

The Government of Alberta response

Premier Danielle Smith is acknowledging the need for immediate steps to preserve and strengthen the economic and security partnership with the United States, to try to avoid any future tariffs, including: 

1. Focus on Diplomacy: Refrain from retaliatory measures like export tariffs or cutting off energy to the U.S. Strong and consistent diplomacy, working in good faith towards shared priorities, is crucial. 

2. Increase Bilateral Trade: Negotiate ways to increase trade between Canada and the U.S. For example, the U.S. could purchase more oil, timber, and agricultural products from Canada, while Canada could buy more American gas turbines, military equipment, and computer hardware. 

3. Enhance Border Security: Deploy resources to secure the shared border from illegal drugs and migration within the next month, either by border provinces alone or in partnership with the federal government. 

4. Accelerate NATO Target: Announce a major acceleration of Canada’s 2% of GDP NATO target, a shared priority benefiting both nations. 

5. Tighten Immigration Controls: Crack down on immigration streams and loopholes that allow individuals hostile to Canada and the U.S. to enter, and restore immigration levels and rules to those under former Prime Minister Stephen Harper. 

6. Repeal Anti-Energy Policies: Immediately repeal federal anti-energy policies and fast-track pre-approvals for the Northern Gateway and Energy East projects. 

Premier Smith believes that these steps are essential to achieving a positive resolution with U.S. allies and avoiding unnecessary escalation and threats. 

Trade across the Canada-U.S. border

Every day, $3.6 billion worth of goods cross the Canada-U.S. border, contributing to a $1.3 trillion annual trade relationship. Canadians spend $722 per person on U.S. agricultural products each year, while Americans spend $118 per person on Canadian agricultural products. 

The American and Canadian beef and cattle industries are partners in this cross-border trade, with small and medium-sized processors and local food systems on both sides relying on the free flow of cattle and beef. 

Phinney pointed out that tariffs would have significant impacts on both the Canadian and American beef and cattle industries, affecting prices, production, trade flows, and margins, as well as the utilization of feedlots, packing plants, and trucking. This would also impact other upstream and downstream partners in the supply chain, leading to increased volatility. 

The tariff would affect beef producers across North America, jeopardizing American jobs throughout the value chain and increasing costs for consumers in both Canada and the U.S. at grocery stores and restaurants.