Tariffs on China, Canada and Mexico go into effect
The Trump administration’s planned tariffs on U.S. exports took effect on March 4, including a 25 percent tariff on Mexico and Canada, with one exception for Canadian energy exports, which has a 10 percent tariff in place.
President Donald J. Trump also raised current tariffs on imports from China to 20 percent, targeting all three countries for not doing more to help the U.S. counter the fentanyl crisis.
The tariffs were initially set to go into effect last month, but Trump opted to delay them, citing progress in negotiations with the three countries.
“Trump is proceeding with implementing tariffs on Canada and Mexico under the International Emergency Economic Powers Act to combat the extraordinary threat to U.S. national security, including our public health posed by unchecked drug trafficking,” a White House press release states.
However, Mexico and Canada have since retaliated with their own duties on U.S. goods but Mexico’s President Claudia Sheinbaum has promised to address retaliatory tariffs, stressing the importance of resolving trade disagreements to help farmers focus on their work.
During Trump’s Congressional speech, he announced another sweeping “external” agriculture tariff which will take effect April 2, but did not specify which products would be impacted or whether any exceptions would be made.
He did acknowledge the economic repercussions of his tariffs, asking the American people to bear with him through the adjustment period.
Possible resolution
According to a March 5 press release published by the White House, “At the request of companies associated with the U.S.-Mexico-Canada Agreement (USMCA), the president is giving them an exemption for one month so they are not at an economic disadvantage.”
The three automakers Trump spoke with were General Motors, Ford Motor Company and Stellantis.
“The president expects the automakers to move production back to the U.S,” White House Press Secretary Karoline Leavitt states during the press conference.
However, U.S. Commerce Secretary Howard Lutnick signaled a possible agreement between the Trump administration and leaders of Canada and Mexico which could resolve some of the tariffs imposed on both nations.
On March 6, Trump released a statement saying Mexico won’t be required to pay tariffs on any goods falling under the USMCA until April 2, but made no mention of reprieve for Canada.
U.S. Secretary of Agriculture Brooke Rollins told Bloomberg News, “Everything is on the table, and I’m hopeful the Trump administration could decide on providing relief for the agricultural sector.”
In a recent interview with Farm Journal at Commodity Classic, U.S. Department of Agriculture Economist Seth Meyer says he has been instructed by Rollins to be ready for a relief program, and he’s started calculating what possible relief could look like.
Recently, state lawmakers with strong agriculture interests spoke with the Trump administration to carve out tariff exemptions for fertilizers and other products critical for growing U.S. crops.
Reaction from the ag industry
Support for agricultural tariffs presents mixed opinions among farmers and ranchers.
Some support tariffs as a means to advocate for fairer trade deals and protect American industries, while others express concerns over the potential negative impacts on their businesses.
In a March 4 press release, American Farm Bureau Federation President Zippy Duvall states, “Farmers support the goals of ensuring security and fair trade with other nations, but additional tariffs, along with expected retaliatory tariffs, will take a toll on rural America.”
“Approximately 85 percent of total potash supply – a key ingredient in fertilizer – is imported from Canada,” he adds. “For the third straight year, farmers are losing money on almost every major crop planted. Adding even more costs and reducing markets for American agricultural goods could create an economic burden some farmers may not be able to bear.”
On the same day, the National Corn Growers Association (NCGA) released a statement of their own.
“Farmers are facing a troubling economic landscape due to rising input costs and declining corn prices. We ask Trump to quickly negotiate agreements with Mexico, Canada and China to benefit American farmers while addressing issues important to the U.S. We call on our trading partners to work with the president to resolve these issues so we can restore vital market access,” states NCGA President and Illinois Farmer Kenneth Hartman, Jr.
Also voicing concern is the U.S. Meat Export Federation (USMEF).
“USMEF is obviously disappointed no agreements have yet been reached to avoid or postpone tariffs on goods from Mexico and Canada, as well as the tariff increase on goods from China,” USMEF President and Chief Executive Officer Dan Halstrom states. “We are reviewing the retaliatory measures announced by Canada and China and are watching for details on the response from Mexico. These three markets accounted for $8.4 billion in U.S. red meat exports last year, including nearly $4 billion to Mexico.”
Melissa Anderson is the editor of the Wyoming Livestock Roundup. Send comments on this article to roundup@wylr.net.
