Canadian cattle producers have warned the cost of beef “will greatly increase on both sides of the border” after US president Donald Trump followed through on his long-threatened plan to impose significant tariffs on three major trading partners.
On Saturday Mr Trump signed an executive order applying tariffs of 25 per cent on all imports from Canada and Mexico (with the exception of Canadian oil and energy products which will incur a 10 per cent) and a 10 per cent tariffs on goods from China.
The sanctions apply from Tuesday, February 4.
Mexico and Canada both supply large numbers of feeder and slaughter cattle into the US production system every year, repsectively exporting 1.2 million and 730,000 cattle in 2023.
Cattle exports from Mexico were temporarily suspended by the USDA in November 2024 due to a detection of New World Screwworm in southern Mexico.
The USDA lifted the ban and announced the resumption of cattle and bison imports from Mexico on Saturday, February 1 – the same day President Trump announced the new 25 percent tariffs.
The Canadian Cattle Association (CCA) and National Cattle Feeders’ Association expressed their “extreme disappointment” at the 25 percent tariffs to be implemented on Tuesday, February 4.
“The integration of the North American live cattle and beef supply chain is unlike anywhere in the world, contributing to both food security and local and regional food systems,” says Nathan Phinney, CCA President, said in a statement.
“The United States and Canada have the largest two-way trade in live cattle and beef in the world.
“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.”
Will Lowe, chair of Canada’s National Cattle Feeders’ Association, said a substantial number of live cattle were transported from Canada to the United States for processing.
US processing plants relied on Canadian live cattle to maintain maximum processing capacity, and provided significant economic benefits and job opportunities to the northern US states.
Mr Phinney said Canadian producers expected trade agreements “to be respected and honoured”.
“International trade is advanced through negotiation and compromise, as was done with the revision of NAFTA by President Trump himself.”
The statement said Canadians purchase $722 USD/person of U.S. agricultural products each year while Americans purchase just $118 USD/person of Canadian agricultural products annually.
“The impact of this tariff on cattle producers will be felt immediately and severely,” Mr Lowe said.
“The cattle sector is a highly integrated North American market. When dealing with live animals you are not able to pivot quickly, and this tariff could cripple the world-renowned beef industry on both side of the border.”
The statement said the Canadian beef industry will be seeking an exemption and will be advocating for any relief support necessary for Canadian beef producers.
“The impact of the tariff will be felt by beef producers and all of agriculture across North America, jeopardizing American jobs throughout the value chain and increasing costs for citizens of both Canada and the United States at the grocery store and in restaurants.”
Mr Trump also signposted further trade measures to come in mid-February that could impact Australian pharmaceutical and aluminium exports.
Australian Trade Minister Senator Farrell told The Australian Financial Review he is urgently seeking talks with his US counterpart Howard Lutnick, and intended to stress “that whereas the US had a trade deficit with Canada, Mexico and China, it had a $40 billion trade surplus with Australia, meaning the imposition of tariffs would be detrimental to the US”.
Canada, Mexico and China have individually said will each impose retaliatory tariffs and counter measures while also flagging direct challenges to the tariffs through the World Trade Organisation.
Australia was the largest supplier of boxed beef into the US in 2024.
Tariffs on cattle from Canada and Mexico would potentially benefit Australia’s cattle industry by creating further demand for Australian beef.
Earlier article: US tariff threat clouds outlook for beef
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