CALGARY, ALBERTA (RFD NEWS) — Western Canadian premiers are pushing back against the possibility of export taxes on energy and fertilizer products as trade tensions between Canada and the United States continue.
The idea has been discussed as a potential response to tariffs and other trade actions from the Trump administration, but leaders in Alberta and Saskatchewan say such a move could hurt their own industries and farmers.
Shaun Haney, host of RealAg Radio, says the proposal has been raised as a way for Canada to gain leverage because of the importance of Canadian energy and Saskatchewan potash to the U.S. market.
Western Provinces Push Back
Alberta Premier Danielle Smith and Saskatchewan Premier Scott Moe have both opposed export taxes on natural resources headed to the United States.
Moe said Saskatchewan would not support an export tariff on the province’s natural resources, including potash.
Haney says Saskatchewan’s concern is that a potash export tax would ultimately raise fertilizer costs worldwide, creating additional challenges for farmers.
The idea has more support in Eastern Canada, but Haney says it faces significant resistance in the West.
Could Export Taxes Become a Trade Strategy?
Haney says he does not expect the Canadian government to ultimately pursue export taxes on energy or fertilizer.
He characterized comments from Prime Minister Mark Carney about potentially restricting energy exports to the United States as more of a trial balloon than a likely policy.
Haney also pointed to the highly integrated nature of the Canadian and U.S. economies.
If Canada imposed an export tax on energy moving from Alberta into the United States, he said the U.S. could respond with its own measures against Canadian products.
The same could happen with potash and other agricultural inputs.
“That’s how trade wars or trade battles spiral out of control,” Haney said.
Hoping for a Return to Negotiations
Haney says the agriculture industry wants Canada and the United States to return to the negotiating table as quickly as possible.
While U.S. Trade Representative Ambassador Jamieson Greer has said there are currently no open channels between the two countries, Haney says that does not necessarily mean back-channel communication is not taking place.
He also pointed to comments from former Canadian MP Lisa Raitt, who serves on the prime minister’s advisory council on trade.
Raitt recently expressed more optimism that negotiations could resume sooner than expected, based in part on public comments from Canadian Trade Minister Dominic LeBlanc.
For farmers and other industries on both sides of the border, Haney says a quick return to negotiations could help prevent the ongoing trade dispute from escalating further.
