U.S. President Donald Trump imposed a 25% additional tariff on imports from Canada and Mexico over the weekend, but those are on hold after Trump spoke with each country's leader.
Trump had imposed a 25% additional tariff on imports from Canada and Mexico and a 10% additional tariff on imports from China, effective February 1. Trump said he took this action to hold these three countries “accountable to their promises of halting illegal immigration and stopping poisonous fentanyl and other drugs from flowing into our country.”
However, after Trump and Mexico President Claudia Scheinbaum spoke on Monday morning, the White House confirmed the tariffs on Mexican goods are on hold for one month after the two leaders reached an agreement on border security and drug and weapons trafficking.
Scheinbaum had said in a statement over the weekend that she had instructed her economic secretary to “implement Plan B that we have been working on, which includes tariff and non-tariff measures in defense of Mexico’s interests,” but did not offer much detail on the response.
And Canadian Prime Minister Justin Trudeau said after a Monday afternoon call with Trump that U.S. tariffs on Canada would also be postponed for one month while the two countries negotiate a border deal.
The Canadian government had responded to Trump's tariff measures with a 25% tariff on $30 billion in goods imported from the U.S. According to the government of Canada, those goods include complete animal feed and supplements including concentrates, meat and poultry products, live poultry, dairy products, eggs, wheat, rye, barley, oats, rice, rapeseed, and certain seed oils.
Reactions from industry groups
Tyson CEO Donnie King, in the company’s first quarter earnings call on February 3, said the company has been preparing for tariffs and making contingency plans for products it exports to Mexico, particularly pork. Tyson also exports mechanically separated chicken and chicken leg quarters to Mexico.
“Mexico is a large trading partner for us,” he said. So essentially, what we would do, whether it be pork or it be chicken, is we would find other markets. We would leverage our global knowledge and expertise to try to move these products if necessary.”
Tyson exports a small amount of chicken products to Canada, and imports some feeder cattle and hogs from the country.
American Feed Industry Association President and CEO Constance Cullman said it understands the president must take action to address national security concerns.
"The AFIA is a firm believer in fair trade, recognizing that tariffs, when used appropriately, can be an effective tool to right trade imbalances," she said. "We encourage continued dialogue to seek resolution to the security challenges to minimize any retaliatory tariffs being put in place and allow U.S. agricultural products to continue to feed the world. The AFIA will continue to monitor the situation and share with the administration the impact of tariffs on the U.S. animal food industry.”
American Farm Bureau President Zippy Duvall expressed alarm about potential harm to farmers resulting from the tariffs.
“Farm Bureau members support the goals of security and ensuring fair trade with our North American neighbors and China, but, unfortunately, we know from experience that farmers and rural communities will bear the brunt of retaliation. Harmful effects of retaliation to farmers ripple through the rest of the rural economy,” he said. “In addition, over 80% of the United States’ supply of a key fertilizer ingredient — potash — comes from Canada. Tariffs that increase fertilizer prices threaten to deliver another blow to the finances of farm families already grappling with inflation and high supply costs.”
Duvall later said he was encouraged by the delays in tariffs.
According to Duvall, last year the U.S. exported more than $30 billion in agricultural products to Mexico, $29 billion to Canada and $26 billion to China – its top three markets and nearly half of all exports by value combined.
National Farmers Union (NFU) President Rob Larew said American farmers and ranchers would be affected by the tariff actions.
“This comes at a time of deep uncertainty for farmers – commodity prices are volatile, input costs remain high, and we still lack an updated farm bill,” he said. “One thing is clear: American family farmers and ranchers are always the first to bear the brunt of unilateral trade actions. While we support efforts to hold trading partners accountable and strengthen American manufacturing, our members have already suffered heavy losses from past trade disputes, especially with China, and have lost valuable market access.”
Larew urged Trump to “put a plan in place to protect and support family farmers and ranchers.”
