CUSMA Renegotiation Expected to Result in U.S. Tariffs on Canadian Agriculture

A Partner with Polar Pork fears the upcoming review of the Canada United States Mexico Agreement will result in tariffs on Canadian agricultural products entering the U.S. With the first joint review of the Canada-United States-Mexico Agreement set to begin formally in July pork producers on both sides of the Canada U.S. border are tracking developments related to the renegotiation.

Florian Possberg, a Partner with Polar Pork, observes U.S. President Trump has negotiated trade agreements around the world and, generally speaking, he's been asking for a base tariff of 15 percent on goods coming into the United States.

Quote-Florian Possberg-Polar Pork:

So far CUSMA has prevented implementation of tariffs on both live hogs and, just as important if not more important, is the trade in pork cuts and pork products has traded freely. Mexico is a very significant buyer of pork, from mostly the United States but also from Canada and a lot of our products move across border for processing in different jurisdictions and move back and forth so the free trade agreement has been absolutely critical for our flow of pork across border.

Like I said, the good thing is that we've been able to not have to suffer the tariffs but the best case  that we can have happen is that that continues after the renegotiation.The worst case is a 15 percent tariff that causes our cross-border business to be unsustainable.

Possberg notes, our agricultural goods are going into the U.S. with no tariffs presently and, if after the negotiations, we have a 15 percent tariff on our agriculture products, that’s a deal breaker because we don't make a 15 percent profit. He says we don't yet know how agriculture will be impacted but it's going to create uncertainty until it's settled.