CALGARY, Alberta (RFD NEWS) — Canada and the United States continue negotiations aimed at reducing sectoral tariffs as the two countries work toward an August deadline for a broader trade agreement.
Shaun Haney, host of RealAg Radio, joined Market Day Report to discuss the latest developments and what the negotiations could mean for agriculture.
Haney said momentum appears to be building as Canadian Prime Minister Mark Carney works to negotiate lower U.S. tariffs on Canadian steel, aluminum, forestry products and potentially automobiles.
The United States has threatened a 50 percent tariff on certain Canadian goods, with deadlines approaching later this month.
Agriculture on the Negotiating Table
While much of the attention has focused on industrial tariffs, Haney said agriculture is also part of the discussions.
One issue involves Canada’s provincial restrictions on U.S. alcohol imports. Another is Canada’s administration of dairy tariff-rate quotas, which has been a longstanding point of contention between the two countries.
Haney said changes to Canada’s dairy TRQ system could give U.S. dairy producers greater access to the Canadian market.
The issue dates back to negotiations surrounding the replacement of NAFTA with the U.S.-Mexico-Canada Agreement (USMCA) and remains an irritant in the bilateral trade relationship.
Pressure on Carney to Negotiate
Haney said there is significant economic pressure on Carney to address the sectoral tariffs, particularly because industries such as steel, aluminum and automobiles are especially important to Ontario and Quebec.
Those sectors are major contributors to the Canadian economy, making the tariffs a significant concern for the country’s largest population centers.
Haney described Carney’s approach as pragmatic, saying the prime minister appears focused on finding compromises with President Donald Trump rather than allowing the trade dispute to escalate.
However, that approach has also drawn criticism from some Canadians who believe Carney should take a harder line in negotiations.
Haney noted that Carney campaigned on an “elbows up” message, a hockey reference emphasizing Canada’s willingness to stand up to the United States.
Dairy Producers Watching Closely
Canada’s dairy industry is among those closely watching the negotiations.
Haney said Canadian dairy producers would likely be unhappy with any changes to the country’s dairy tariff-rate quota system that provide additional access to U.S. products.
Still, he said the Canadian government appears willing to consider concessions if they can help reduce the broader economic impact of the tariffs.
LEARN MORE: www.realagriculture.com
