how u.s. tariffs and trudeau's counter-tariff plan would increase canada's food prices
canada plans to counter u.s. tariffs with a list of its own, which could mean higher food prices for canadians
5 minute read
canada's counter-tariff plan targets $155 billion worth of american goods, including beer, bourbon, fruits and fruit juices, poultry, beef and vegetables.
stefani reynolds/afp via getty images
maple syrup, not mrs. butterworth’s. hawkins, not cheetos. some american-to-canadian swaps are obvious — others, especially tropical fruits, not so much.
canada’s counter-tariff plan targets $155 billion worth of american goods, including fruits and fruit juices, poultry, beef and vegetables. prime minister justin trudeau announced on social media on feb. 3, “proposed tariffs will be paused for at least 30 days while we work together.” the government had initially planned to impose 25 per cent tariffs on $30 billion in goods that would remain until the united states removed its tariffs against canada. the u.s. tariffs were set to come into effect at 12:01 a.m. on feb. 4.
experts break down what changes canadians can expect in food prices should the u.s. tariffs be imposed, what categories are most likely to be affected and strategies for buying more homegrown food.
how could u.s. tariffs affect food prices in canada?
“tariffs usually mean one thing — higher prices,” says sylvain charlebois, senior director of dalhousie university’s agri-food analytics lab. tariffs on canadian food exports could cause producers to sell elsewhere, increasing domestic prices. “it’s a chain reaction — higher costs for farmers and suppliers almost always trickle down to consumers.”
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michael j. widener, professor and chair of the university of toronto’s department of geography and planning, expects “a perfect storm” of rising food prices and lower income levels, making the affordability gap even more expansive. “if these tariffs are impacting things like the auto industry, and we see increases in unemployment there, we’re going to see a lot more folks struggling to make ends meet when it comes to buying food for their household,” says widener.
“beyond just going to the grocery store and buying whatever groceries you need, it will also make it harder to take the bus to get there. it’s going to be harder to pay your heating bills. people will feel much more stretched.”
according to charlebois, canada’s counter-tariffs would affect canadians the most. how hard they’ll hit depends on how quickly the country adjusts and secures alternatives to american products.
how soon would canadians see a change, and how long could it last?
shoppers could notice higher food prices quickly, depending on the product. charlebois says that the cost of perishable items, such as fresh fruit and vegetables, could increase within weeks. packaged goods and other non-perishable items could take longer if retailers have excess inventory. he adds that the dollar’s strength is another factor, with the loonie falling to its lowest level in more than 20 years.
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but don’t expect american products to disappear from store shelves overnight. “big grocery chains will still source from the u.s. because it’s efficient and close. but if tariffs make certain items too expensive, stores might start looking elsewhere — maybe to europe, south america or even boosting canadian suppliers. it all depends on how this plays out,” adds charlebois.
widener thinks canadians would be in for “a hard couple of months” as the country adjusts to a new order of north american trade. given the unpredictability of the political situation in the u.s., a trade war could last a week or a couple of years.
“i think we’re in for a bit of pain, unfortunately, and i hope that people are putting pressure on our governments to make sure that they’re coming up with a good plan to adapt — and also on our grocery stores. they also have a role to play, where we want to see the private sector stepping up and serving the country.”
what foods would be affected the most?
according to widener, canada imports roughly 50 per cent of vegetables and 80 per cent of fruit. “it’ll be much harder for people to get fresh fruits and vegetables.” he also expects prices for dairy products, which are already subject to tariffs when imported into canada — and expensive, relative to the u.s. — to increase because of less competition.
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charlebois also expects prices of fruit and vegetables — especially berries, leafy greens and tropical produce, such as bananas, oranges, lemons, avocados and pineapples — ”anything from california or florida” — to increase as soon as a few weeks. processed snacks, cereals and frozen meals made in the united states or with american ingredients (“prepared in canada”) could also get costlier.
how realistic is it to ‘choose canada’ in the grocery store?
trudeau said in a feb. 1 address that now is “the time to choose canada.” charlebois says buying canadian is doable for some foods but not all. “meat, dairy, bakery and some dry goods, no problem. but if you’re trying to avoid u.s. products entirely, good luck.”
charlebois underscores that roughly 10 per cent of food products are actually made in canada (labelled “product of canada”). on top of the sheer number of american foods canadians rely on, price matters. “if canadian-made products cost more than the u.s. imports, many shoppers will stick with what’s cheaper.”
widener expects dairy and produce to be the categories canadians would “see and feel the most,” but also highlights the complexity of the food supply chain because of the flow of goods enabled by the north american free trade agreement (nafta). “with the u.s. basically opting out (of nafta), we’re in a pretty unprecedented situation,” says widener.
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“(canadian) grain may be sent to the u.s. to be processed and sent back to canada as cereal. so, these kinds of issues will complicate all sorts of supply chains and make things a lot more expensive across the range of grocery items we normally shop for.”
strategies for buying more homegrown food
charlebois and widener recommend reading labels as a first step. “’product of canada’ is the gold standard,” says charlebois. “‘made in canada’ means that the last processing step was in canada, and the product contains at least 51 per cent of ingredients from canada. ‘prepared in canada,’ like kraft’s peanut butter, is manufactured in canada, with foreign ingredients.”
buying canadian produce in-season — “it’s fresher and cheaper” — and shopping at farmers’ markets, independent butchers and dairies is also a good tactic. “if you’re at a grocery store, asking about local alternatives might encourage them to stock more homegrown options. it’s all about being mindful of where your food is coming from and making those small shifts when possible,” says charlebois.
widener agrees that buying locally is a good strategy for those who can afford it. he recommends that people consider canned or frozen fruit and vegetables, which tend to be more affordable and just as nutritious, and focus on a well-balanced diet. he expects many canadians would struggle to make ends meet under the tariffs. “and we know that when people are economically or financially insecure, that will have a huge impact on food insecurity.”
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