U.S. President Donald Trump is taking aim at Canada’s supply-managed dairy industry — and also took another shot at Canada’s lumber sector.
Trump said Friday he’s planning to impose a 250 per cent tariff on Canadian dairy imports, possibly “as early as today.”
In his Oval Office remarks, Trump said Canada has been treating U.S. dairy farmers unfairly.
“Canada has been ripping us off for years on lumber and on dairy products,” said Trump.
“We may do it as early as today, or we’ll wait until Monday or Tuesday,” Trump said on Friday. “We’re going to charge the same thing. It’s not fair. It never has been fair, and they’ve treated our farmers badly.”
The head of the association representing Canada’s dairy farmers said that since the implementation of the CUSMA trade agreement, U.S. producers have already eaten up a chunk of the Canadian market.
“This increased U.S. access came at a direct cost to Canadian dairy farmers, reducing their market share and weakening the stability of Canada’s domestic dairy sector,” said Dairy Farmers of Canada president David Wiens.
Wiens said supply management in the dairy sector helps ensure Canada has food security and sovereignty.
“Canada’s dairy sector operates under a supply management system designed to meet our country’s needs first, ensuring that key food commodities, including dairy, are made in Canada for Canadians,” said Wiens. “We call upon our federal and provincial governments to defend our economy, and to safeguard our national food security and sovereignty.”
Canada’s dairy industry is tiny compared with the size of its American counterpart, noted Mike von Massow, a professor at the University of Guelph’s Ontario Agricultural College.
“There are more cows in the state of Wisconsin than there are in all of Canada,” said von Massow.
According to government and industry statistics, Canada produces roughly 95 million hectolitres — or 9.5 trillion litres — of milk per year.
The American industry, which typically measures production in pounds, produced a whopping 225.854 trillion pounds of milk last year, which translates into roughly 112.9 trillion litres of milk.
In 2023, Canada exported $293.3 million of dairy products to the U.S., with more than $1 billion in American dairy imports coming here.
The American dairy industry has long chafed at its restricted access to the Canadian market, even if this country is a relatively small market by comparison.
Trump’s words were music to the ears of American dairy producers, who accused the Canadian government of hypocrisy, and not living up to its commitments under CUSMA.
“The Canadian government talks out of both sides of its mouth on trade. They’re free traders on everything except dairy,” said Jaime Castaneda, executive vice president of the National Milk Producers Federation.
In CUSMA, said Castaneda, Canada committed to giving American dairy producers a tariff-free import quota equal to 2.86 per cent of the Canadian market.
“We weren’t happy, but it was 2.86 per cent that we didn’t have before,” said Castaneda.
But nontariff barriers — such as changing definitions of different product categories — mean that U.S. producers haven’t gotten anywhere near that share, he added.
“They’re putting up barrier after barrier,” said Castaneda. “Keep supply management — that’s a service to their own farmers. We don’t care about that. We just want the access that we were promised.”
Even if Canada gave U.S. dairy producers tariff-free access to the whole market, the industry wouldn’t collapse entirely, argued Guelph’s von Massow.
“It wouldn’t disappear, but parts of it would definitely shrink. We’d probably produce less cheese, but we’d still produce a lot of fluid milk, because that’s more expensive to ship,” said von Massow.
