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- 🌱 25% Tariff Starting March 4th
🌱 25% Tariff Starting March 4th
Ontario Grower
March 03, 2025
Morning, Grower.
Here’s what we got for you today:
Ontario Election Results
US Tariff Update
The History of Canada’s Tariffs on US Agriculture Products
Ontario Election Results
Out of 124 seats, Doug Ford and the PC Party of Ontario earned 80, meaning the PC Party has a majority government in Ontario.
What’s Going On with US Tariffs?
President Trump created a bit of confusion last week regarding tariffs.
He mentioned in his Cabinet Meeting on Wednesday that tariffs would be postponed until April.
But on Thursday, he posted this on Truth Social…
A 25% tariff on Canadian goods exported to the United States will begin on March 4th.
Trump mentioned that there are also Reciprocal Tariffs planned for April. FYI, a reciprocal tariff is designed to mirror or counterbalance the tariffs imposed by other nations on American goods.
The History of Canada’s Tariffs on U.S. Agriculture Products
Canada's tariffs on U.S. agricultural products have an interesting history.
The Canada-United States Trade Agreement (CUSTA) in 1989 began eliminating tariffs between Canada and U.S. This process continued with NAFTA in 1994, which removed most tariffs and quotas on agricultural trade over 14 years.
However, certain sensitive products remained protected. Under NAFTA, Canada maintained tariff-rate quotas (TRQs) on US dairy products, poultry, eggs, and margarine. These TRQs allowed a specific volume of imports at low or zero tariffs, with high tariffs applied to imports exceeding the quota.
The Canada-United States-Mexico Agreement (CUSMA, also known as USMCA) replaced NAFTA in 2020 and expanded market access for US exports of dairy, most poultry products, and eggs to Canada.
CUSMA Tariff Rate Quotas (2025)
Today, Canada administers 16 CUSMA-specific TRQs affecting U.S. agricultural exports, here are some examples:
Product | CUSMA Quota (Annual) | In-Quota Tariff | Over-Quota Tariff | U.S. Export Impact (2024) |
|---|---|---|---|---|
Fluid Milk 🥛 | 17,000 MT | 0% | 245% | Limited to 3.2% of Canadian market |
Cheese 🧀 | 12,500 MT | 0% | 245% | $420M annual cap despite $1.2B demand |
Chicken (Eviscerated) 🐔 | 121,000 MT | 0% | 238% | 98% fill rate locks out $150M potential exports |
Eggs (Shell) 🥚 | 21M dozen | 0% | 163% | 0.8% market penetration despite geographic proximity |
Butter 🧈 | 5,121 MT | 0% | 298% | TRQ covers <10% of Canadian industrial demand |
While the Canada-United States-Mexico Agreement serves as the base of agricultural trade, U.S. exports to Canada operate under a layered system of 4 frameworks:
Agreement Type | Key Agricultural Provisions | Coverage |
|---|---|---|
CUSMA (2020) | - 16 product-specific TRQs (dairy, poultry, eggs) | Exclusively U.S.-Canada-Mexico |
WTO (1995) | - Base TRQ quantities for dairy/poultry | All WTO members (including U.S.) |
NAFTA Carryovers | - Grandfathered zero-tariff access for 93% of agri-food products | Residual provisions until 2036 |
Bilateral Protocols | - Wheat grading equivalency (2023) | Sector-specific U.S.-Canada deals |
Ultimately, Canada's tariff policies from CUSTA through NAFTA to CUSMA have constantly evolved. With U.S. pressure on our doorstep, we’ll continue to update you along the way!
How was today's edition? |
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