Tariffs on Canada and Mexico paused, but U.S. ag groups still concerned

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Editor’s note: This story was updated Feb. 4

COLUMBUS — In the uncertain hours before 25% import tariffs were set to be imposed on Mexico and Canada on Feb. 1, as well as 10% tariffs on all imports from China, Colin Woodall, CEO of the National Cattlemen’s Beef Association, spoke to attendees at the Ohio Cattlemen’s Association’s annual meeting and awards banquet. He said that “time will tell” whether the upcoming levies will roil the beef industry.

“Will they have an impact on us? We don’t know,” he said during the meeting on Feb. 1. “I don’t think we need to lose our minds quite yet. We have to look at how this plays out.”

Woodall pointed out that recent data from the U.S. Meat Export Federation shows international trade has been strong; the average beef export value was $412.58 per head, which is 5% higher than the previous year’s January-November average. According to the USMEF, beef exports to China/Hong Kong have recently gained momentum after trending lower throughout much of 2024. November shipments jumped 8% from the previous year while value increased 5% to $165.8 million.

“That’s real money. We want to be able to maintain that. We don’t want that to get knocked with retaliatory tariffs,” Woodall said.

“While yes, we have some concerns about the tariffs, while yes, there will be unintended consequences of these tariffs, we have to look at what the long game is, and on balance, where do we come out?” he continued. “Because trade remains very important to us as cow producers, and we want to make sure that we can maintain that. It’s rumble time.”

The situation evolved rapidly. The leaders of Mexico and Canada reached agreements with the Trump administration on Feb. 3, before the tariffs were set to take effect on Feb. 4

It was first reported that Mexican President Claudia Sheinbaum reached an agreement with the Trump administration to postpone her country’s tariffs for one month in exchange for deploying 10,000 troops to help secure the border.

By the end of the day, Trump and Canadian Prime Minister Justin Trudeau had also worked out a deal to postpone the impending 25% export levies on Canada. The two leaders’ political jockeying also temporarily halted Canada’s retaliatory tariffs on American goods from being implemented as planned on Feb. 4.

Levies on products from China are still set to take effect Feb. 4. China’s Ministry of Commerce announced it was implementing counter tariffs against the U.S. on multiple products — a 15% tariff on coal and liquified natural gas products, as well as a 10% tariff on crude oil, agricultural machinery and large-displacement cars, according to the Associated Press.

Trump said that the tariffs on the three nations were intended to curb fentanyl production, illegal immigration and the illegal fentanyl trade, the Associated Press reported. The tariffs cover a wide variety of goods Americans purchase every day and include oil, natural gas and electricity imports from Canada, which were subject to an additional 10% levy.

Ag groups respond

Other leaders of national agriculture organizations quickly voiced concern about the potential impacts they foresaw from Trump’s tariffs, highlighting fears that they could hurt those who grow America’s food.

In a statement, American Farm Bureau President Zippy Duvall said he was concerned about the potential harm that could be brought onto farmers as a result of the tariffs and retaliatory tariffs on the United States’ top three agricultural markets by value. Last year, the U.S. exported over $30 billion in agricultural products to Mexico, $29 billion to Canada and $26 billion to China, making up nearly half of all exports by value combined, Duvall said.

“Tariffs and tariff retaliation often hit farmers and ranchers hard, which make it more difficult for them pay their bills and grow the food America’s families rely on,” he said, adding that the agreement reached between the United States and Mexico was encouraging.

“We appreciate the (Trump) Administration making every effort to resolve these disputes, keep international markets accessible and ensure a stable food supply here at home,” he said.

The Fertilizer Institute President and CEO Corey Rosenbusch called on the Trump administration to exempt Canadian potash and other fertilizers from the tariff order in time for spring planting. Canada is the world’s largest producer and exporter of potash, a key fertilizer ingredient. More than 80% of the United States’ supply of potash comes from Canada, according to the American Farm Bureau.

“No substitutes exist for potash as an essential plant nutrient,” Rosenbusch said. “Any disruption to the intertwined and mutually beneficial cross-border fertilizer trade between the U.S. and Canada will have significant ripple effects, not just for farmers but for the broader food supply chain and ultimately the prices consumers pay at the grocery store.”

Rosenbusch later welcomed the announcement that the tariffs were paused, saying “Open markets and fair competition are integral to the continued success of the US agricultural sector and vital for fertilizer markets to provide the crop nutrients necessary to feed a growing world.”

National Farmers Union President Rob Larew said Trump’s trade actions come at a time of deep uncertainty for farmers, with commodity prices volatile and input costs climbing. Members have suffered heavy losses from past trade disputes, especially with China, and have lost valuable market access as a result, he said.

“Before taking any action that might further stress farm and rural economies, we urge the president to put a plan in place to protect and support family farmers and ranchers,” Larew said.

(Paul Rowley can be reached at paul@farmanddairy.com or 330-337-3419 ext 231. The Associated Press contributed to this report.)

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