Canadian cattle producers are bracing themselves for a significant increase in the cost of beef on both sides of the border following the implementation of tariffs by US President Donald Trump on three major trading partners. On Saturday, Mr. Trump signed an executive order imposing a 25 percent tariff on all imports from Canada and Mexico (with the exception of Canadian oil and energy products, which will face a 10 percent tariff) and a 10 percent tariff on goods from China. These tariffs are set to take effect on Tuesday, February 4.
Mexico and Canada are key suppliers of feeder and slaughter cattle to the US production system, with Mexico exporting 1.2 million cattle and Canada exporting 730,000 cattle in 2023. The USDA temporarily suspended cattle exports from Mexico in November 2024 due to the detection of New World Screwworm in southern Mexico. However, the ban was lifted on Saturday, February 1, the same day President Trump announced the new tariffs.
The Canadian Cattle Association (CCA) and National Cattle Feeders’ Association expressed their extreme disappointment at the 25 percent tariffs, highlighting the integration of the North American live cattle and beef supply chain as a key factor contributing to food security and local and regional food systems. Nathan Phinney, CCA President, emphasized the importance of the trade relationship between the US and Canada, noting that American-born cattle are fed in Canadian feedlots before returning to the US for processing. The tariffs are expected to increase the cost of processing cattle and beef on both sides of the border.
Will Lowe, chair of Canada’s National Cattle Feeders’ Association, pointed out that a substantial number of live cattle are transported from Canada to the US for processing, supporting US processing plants and providing economic benefits and job opportunities in northern US states. The Canadian producers expected trade agreements to be respected and honored, emphasizing the importance of negotiation and compromise in international trade.
The impact of the tariffs on cattle producers is expected to be immediate and severe, potentially crippling the beef industry on both sides of the border. The Canadian beef industry is seeking exemptions and advocating for relief support for Canadian beef producers. The tariffs could also jeopardize American jobs throughout the value chain and increase costs for consumers in both countries.
In addition to the tariffs on Canada, Mexico, and China, President Trump has signaled further trade measures that could impact Australian pharmaceutical and aluminum exports. Australian Trade Minister Senator Farrell is seeking urgent talks with his US counterpart to emphasize the detrimental effects of tariffs on the US trade surplus with Australia. Canada, Mexico, and China have announced plans to impose retaliatory tariffs and countermeasures and challenge the tariffs through the World Trade Organization.
Australia, as the largest supplier of boxed beef to the US in 2024, could potentially benefit from tariffs on cattle from Canada and Mexico by creating additional demand for Australian beef. The outlook for the beef industry remains clouded by the uncertainty of escalating trade tensions and the potential repercussions on global trade.
Overall, the imposition of tariffs by the US administration has raised concerns among Canadian cattle producers about the impact on the beef industry and the integrated North American market. The need for dialogue, cooperation, and support for affected industries is crucial to mitigate the adverse effects of trade disruptions and ensure a stable and prosperous future for agricultural trade relations between the US and its key trading partners.
