One of the most potent weapons in Canada’s arsenal to fight American tariffs is agriculture and agri-food.
That is the headline of a new report issued by RBC Royal Bank. It starts by saying we need to find new markets around the world or lose our competitiveness in the American market.
America takes a large proportion of Canada’s agricultural output – about 60-percent. For canola, it is higher at 95-percent of our oil and 65-percent of the meal.
But even though our sales have quadrupled we have fallen two places to seventh in the world in the last 20 years. That translates into $23 billion in lost sales in 2023 alone, more than Canada’s entire steel and iron industry exports to the US last year. With the added threat of tariffs, we could slide even further.
Agriculture though has delivered the nation’s most productivity improvement, something that gives the bank a sense of optimism that we can make the adjustments. To get back to 5th spot in ten years, we would have to increase value-added exports by 50-percent and commodity exports by 10 points.
