It’s On: American Tariffs Followed By Canadian Retaliation

Soybean planting can be a bit of an Odyssey. At least it feels that way. Give me lots of good sun and dry weather and planting never seems to end. However, eventually you run out of acres and that’s what’s happening to me this week. I hope my soybeans get off to a good start. Give me that rain in August please!

One facet of my soybean-planting regimen is listening to my satellite radio. So when it crackled today with news that the Americans are imposing 25% steel tariffs and 10% aluminum tariffs on Canada, I was taken a bit a back. How could it be that the Americans would slap these tariffs on Canadian steel and aluminum over national security concerns?

There is no greater ally of the United States than Canada. Of course, we share in the NORAD command and are allies in NATO. However, none of that seemed to matter on the news, with most Canadians stung by the insulting excuse of “national security”. Canadian foreign affairs Minister Chrystia Freeland said it was absurd.

There was one caveat to the national security rationale. Apparently, commerce Secretary Wilbur Ross explained to reporters that President Trump acted against Canada because the NAFTA talks were taking too long. That was according to the Toronto Star. Who really knows what the reason is. Keep in mind something that I’ve always said, free trade to our American friends, is whatever they deem to be. President Trump has his own vision, here we are.

It didn’t take long for Canada to respond to the American trade action. The Prime Minister and Foreign Affairs minister Chrystia Freeland scheduled a news conference for 1:30p.m., where they announced Canada was hitting back with duties of up to $16.6 billion on some steel and aluminum products from the US. There were also tariffs announced on an abundance of other products.

Some of these other products which now will have a tariff coming into Canada for cucumbers, tomato ketchup and other tomato sauces, yogurt and an assortment potpourri of products including chocolate. You can bet that all of these selected items by the Canadian government are meant to affect Republican congressional seats in the upcoming midterm election. We are a small nation compared to the United States, so you have to pick your ammunition carefully. We did not ask for this from our American friends. Somehow, we must fight back.

I just happened to be listening to Bloomberg news on my satellite radio they broke for Prime Minister Trudeau and Foreign Affairs minister Freeland’s new conference. I thought that was a bit of a stretch, an American news outlet cutting away for coverage of a Canadian Prime Minister. When they cut away, Freeland started her counterargument in French. It lasted for several seconds and I wondered how this American network was going to deal with that. After she was done, the first question was why she spoke in French? Freeland responded, “Canada is a bilingual country”. My goodness, I couldn’t believe it.

Of course, Québec is the largest producer of aluminum in Canada. Québec Premier Philippe Couillard responded to the tariffs on aluminum by saying it was illogical. He said it was a bad decision for the Americans as they are increasing their manufacturing defense industry costs.

If you have read this column over the last year, you will know that I think all of this is so unnecessary. Our American friends have their economy in overdrive with an unemployment rate of approximately 3.5%. If that isn’t full employment, I don’t know what is. The tariffs put on Canada will affect American jobs. At the same time the Canadian tariffs put on the Americans are meant to inflict the maximum economic damage in specific electoral districts. Nobody is going to win here. I only hope agriculture remains out of the trade fight.

Interestingly enough, American cucumbers are drawing a tariff from Canada. That is a very small market, but it just happens to be in my area of southwestern Ontario. Any type of vegetable like that is interchangeable across the US Canada border. That is until now. Maybe it’s time for me to grow cucumbers here near Dresden. However, it’ll have to be machine harvest.

Simply put, this trade action by the Americans made for a very tough day in Canada. As a Canadian farmer it’s very personal when our largest trading partner threatens us. We know our markets are at risk. This is coming from an American administration that seems to deliberately create chaos in an attempt to get things done. Unfortunately for us in Canada, that strategy has been very damaging.

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