Canada imports more dairy from the U.S. than it exports, which suggests a dairy tariff war would hurt American farmers.
Canada’s dairy industry says tariffs less scary than threats to supply management
Before the trade war, the U.S. dairy that Canada imported wasn't tariffed at all because it was less than the limit agreed upon by the two countries in the existing free-trade deal. Photo by Glenda Luymes/Postmedia files

Canada imports more dairy from the U.S. than it exports, which suggests a dairy tariff war would hurt American farmers.

Members of Canada’s dairy industry say they’re less worried about the threat of steep United States tariffs than about a looming battle over supply management.

U.S. President Donald Trump has threatened to impose what he calls “reciprocal” tariffs on Canadian dairy, saying they’re a response to Canada’s 250 per cent duty on U.S. dairy imports.

Quebec farmer Markus Schnegg says nearly all the dairy produced in Canada is sold for domestic consumption, meaning the U.S. tariffs would only affect a small fraction of the market.

But he’s worried that Canada’s supply management system  which protects the industry from international competition  appears to be in the U.S. president’s crosshairs ahead of a renegotiation of the free-trade deal between the countries.

He adds that before the trade war, the U.S. dairy that Canada imported wasn’t tariffed at all because it was less than the limit agreed upon by the two countries in the existing free-trade deal. Imports above that limit face Canadian tariffs of about 250 per cent.

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