Over 80 percent of U.S. potash comes from Canada
On Feb. 1, President Trump placed 25 percent tariffs on goods coming from Mexico and Canada.
Chinese products, and Canadian energy resources, will have a 10 percent tariff attached to them.
Canada, Mexico and China represent the three biggest markets for U.S. ag products.
Ag groups on both sides of the Canada/U.S. border are sounding the alarm on how a trade war between the two countries will affect their respective industries.
In the U.S., for example, the American Farm Bureau Federation (AFBF) is concerned how these tariffs will challenge farmers for the growing season.
Farmers already operate within thin margins, and increased input costs reduce those margins further, the organization said.
“Over 80% of the United States’ supply of a key fertilizer ingredient — potash — comes from Canada. Tariffs that increase fertilizer prices threaten to deliver another blow to the finances of farm families already grappling with inflation and high supply costs,” AFBF President Zippy Duvall said in a statement.
Some organizations want certain ag products exempted from the tariffs.
Potash and other fertilizers should be among them, The Fertilizer Institute says.
“Given their effects on the broader farm economy, TFI urges the Trump Administration to exempt Canadian potash and other fertilizers from the tariff order, especially as we approach the critical time of spring planting where nutrient delivery and application are essential for the harvests that fill American’s dinner tables with abundant and affordable food,” Corey Rosenbusch, president and CEO, said in a statement.
The Canadian Federation of Agriculture (CFA), Canada’s AFBF equivalent, is also worried about this trade war.
Any dispute involving ag between Canada and the U.S. only benefits other nations the organization said.
“Our agriculture sectors rely on each other, not just to sell products to one another but also to provide essential inputs to grow food such as fertilizer. No one wins in a trade dispute between Canada and the U.S. except for our competitors around the world. Tariffs are quite simply, bad business,” Keith Currie, president of the CFA, said in a press release.
In response to the U.S. tariffs, the Canadian government placed its own tariffs on $30 billion of U.S. products.
Those come into effect on Feb. 4, and include the following ag products:
- Poultry
- Dairy
- Bourbon, beer and other alcoholic beverages
- Farm equipment
- Fertilizers
The Canadian government has a second round of tariffs, affecting another $125 billion of U.S. products, at the ready. Those are scheduled to take effect on Feb. 25.
Ag products like certain fruits and vegetables, beef, pork, and dairy, are included in the second set of tariffs.
One Canadian ag organization is warning American consumers how the tariffs will affect them.
Shoppers can expect the prices of groceries to go up, Grain Growers of Canada says.
This isn’t just a tariff on Canadian farmers—it’s a tax on every American family purchasing loaf of bread, oatmeal, canola oil, and other food staples at the grocery store,” said Kyle Larkin, the organization’s executive director, said in a press release. “A 25% tariff is, in effect, a 25% tax on American consumers.”
Prior to President Trump going forward with the tariffs, Farms.com spoke with George Frisvold, an ag economist at the University of Arizona.
Frisvold provided clarity on what tariffs are, how they’re used and some of the challenges they bring.