Ongoing trade dispute raises concerns for farmers, manufacturers

By Charlene Tebbutt
June 22, 2018 - 12:00pm

The ongoing dispute between Canada and the United States over tariffs has farmers and manufacturers worried about the threat of rising costs for steel and aluminum. 

Canada has set July 1 as the date to start implementing countermeasures on imports of steel, aluminium and other U.S. products as a result of recent U.S. tariffs. Prince Albert Member of Parliament Randy Hoback has raised concerns in Ottawa over the tariffs and said he’s heard that some companies are already pricing 10 to 15 per cent higher for some products. He said the question isn’t whether tariffs will affect Canadian producers and consumers, but how wide-ranging the fallout will be.

“There’s a lot of things in flux, or a lot of insecurity and unknowns right now, so I think people are being very cautious,” Hoback said. “There is going to be price increases, there’s no question about it. It’s just what will it amount to, and it depends on the product that you’re buying and how much steel or aluminum is in that product.”

Hoback said the federal government has to stand up for Canada and make the U.S. understand there will be consequences over any new tariffs. But, he added, Canada’s plan to impose countermeasures means people here will be forced to pay more as well. He said other measures, such as scrapping the carbon tax and creating new tax incentives, could be more effective.

“At the end of the day in a trade war, we lose with the U.S.,” Hoback said. “What Trump’s done is he’s made everything in the U.S. that much more expensive … so the last thing we want to do here is go to our manufacturers and do that to them.”

The Agricultural Manufacturers of Canada recently sent a letter to Canada’s government urging them to continue talks with the U.S. and end the dispute.

“There’s millions of dollars of farm equipment that flows across the Canada-U.S. border every day,” Leah Olson, AMC president, said. “Our concern is that, at the end of the day, that’s going to impact the price of the farm equipment and by virtue of that, our customers.”

Olson said the AMC has also urged the government to reinvest money taken in duties back into the agriculture industry, in case the tariffs remain in place for a longer term.

“If we aren’t to be as competitive as we were, say, a year ago, then we will be requesting that the government consider ways to support farmers in their ability to invest into farm equipment,” Olson said.

Sales of used agriculture equipment are still fairly strong at the moment, and dealers are seeing more interest in harvest equipment as well, according to Arthur Ward, president of Pattison Agriculture. Still, with the uncertainty over equipment prices due to the tariffs, Ward said many producers may go ahead and just buy now.

“We don’t know what the price for next year is going to be,” Ward said. 

 

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On Twitter: @CharleneTebbutt

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