Opinion
During the 2018 trade negotiation between Canada, the U.S. and Mexico there was significant weight put on the partnership between stakeholders among the three countries. Whether it was beef, pork, biofuels, fertilizer or the like, many stakeholders referenced their “integrated supply chain.” It was emphasized as a reason to “do no harm.”
For 2025, I would consider parking the phrase and finding an adequate euphemism. Once a reason to have free trade and proof that it produces value for the three countries, “integrated supply chains” is now a phrase equivalent to being the Crocs of trade lingo — mocked by many and better left behind than worn about in public.
The problem is China. Many of the U.S. trade policies from the White House and Congress are currently crafted to combat China or Brazil. They are not crafted to push back on a canola crush plant in Saskatchewan or an auto components plant in Ontario, though that may be the outcome.
On the U.S. election trail, vice-president-elect JD Vance talked about integrated supply chains as a negative, speaking of the need for the U.S. to have domestic supply chains. Vance knows China and Canada are different, but today’s political discourse has no time for that nuance.
As Canada and U.S. agricultural trade has increased to all time highs, the U.S. appears to be reconsidering its options. Agricultural trade between Canada and the U.S. is not just about finished goods but components of the supply chain like feeder cattle, weaners, feed stocks etc.
A Bloomberg story noted some observers have said they expect Trump will exempt commodities from his threat to place 25 per cent levies on goods from Mexico and Canada, and focus instead on using tariffs against their manufacturing industries. In Canada’s case, that includes the auto manufacturing, aerospace, and aluminum sectors, which are centered in Ontario and Quebec.
The risk to Canada of a 25 per cent tariff being put on components or commodities would be devastating to those segments of the agricultural industry on either side of the border. This casualty would impact a feedyard in Alberta and likewise the packing house in Washington that is only viable to kill U.S. cattle because of the supplementary supply of Canadian live cattle.
Unwinding the cross-border integrated supply chain of agriculture is not practical or even possible, but finding a new word to describe it before the Trump administration takes office would be well-timed.
