Canada Considers New Retaliatory Tariffs on U.S. Agricultural Products

The Tariffs Are in Retaliation for Steel and Aluminum Tariffs Enacted by the U.S.


By Gil Gullickson, Successful Farming - 4/9/2019


 New retaliatory tariffs by Canada on U.S. products including agricultural ones may soon be on the way.


David MacNaughton, Canada's ambassador to the U.S., told members of the North American Agricultural Journalists (NAAJ) at this week’s annual NAAJ meeting in Washington, D.C., that the proposed retaliatory tariffs are in response to the U.S. using Section 232 of the Trade Expansion Act of 1962 that place tariffs on steel and aluminum for national security reasons. These were instituted during negotiations of the United States-Mexico-Canada Agreement (USMCA) trade agreement. This agreement between the U.S., Mexico, and Canada to replace the North American Free Trade Agreement has been signed but not yet ratified between the three nations.


 “When the U.S. imposed (steel and aluminum) tariffs, we said we could put in corresponding tariffs—dollar for dollar—in retaliation of unjustified and illegal tariffs,” says MacNaughton. “Our position is that the tariffs are unjustified and illegal and should go.”


U.S. agricultural products on which Canada may add tariffs include apples, pork, and ethanol. During a 45-day consultation period, Canada would determine which would have the least impact on Canadian consumers and the most impact on the U.S.


“That's what retaliation is designed to do,” says MacNaughton. “I indicated to Ambassador (Robert) Lighthizer (U.S. Trade Representative) and anyone else in the administration, and quite a number of people including members of Congress, that we are prepared to sit down today, tomorrow, the day after, next week, any time to try and resolve this matter. What I would rather talk about other than the retaliation list is the positive nature of USMCA. I think it is significant improvement over the existing agreement. It creates more opportunity in the agricultural sector.”


If successful negotiations do not soon occur, though, MacNaughton says the matter will not be resolved before Canada’s election this October.


“If it is unresolved and Section 232 tariffs are in place, the discussion about our relationship with the United States of America will be central part of the campaign, and it will not be a positive discussion,” says MacNaughton.


McNaughton questions the reasoning behind the implementation of steel and aluminum tariffs...  


Interesting Dichotomy ...