(Editor’s note: This opinion reflects the latest update as of the morning of March 6. Shortly after WLJ press time, President Donald Trump expanded exemptions through April 2 on Canada and Mexico tariffs for products covered under the U.S.-Mexico-Canada Agreement established under Trump’s first term.)
The nervousness across all sectors of agriculture is palpable.
“In life, there are ups and downs. Trust the process and have faith that everything will work out as it should,” said renowned pastor and author Joel Osteen. While this is much easier said than done, we must address our surroundings because it’s going to impact us all.
The U.S.’ three largest trading partners have now entered the beginnings of a trade war by use of tariffs. This same tactical approach was used by President Donald Trump in his first term and was an effective method of producing results. However, this time around is much more aggressive and wide sweeping.
During his campaign, Trump stayed solid on securing the nation’s borders, with the deadly drug fentanyl taking a lot of highlights on the list, and he’s living up to his word on that front. However, all trade agreements and prior business relationships have been set aside, and all the chips have been moved to the center of the table to address the border issues.
The bold move has the entire world watching our every move, and with Ukrainian President Volodymyr Zelenskyy’s recent visit to D.C., where talks completely unraveled, everyone on both sides of the aisle are on the brink of panic.
Canada currently exports just over half of its annual calf crop, with 75% of that going into the U.S. That number increases as cattle reach harvest weights and are then exported to the U.S. According to data released by the U.S. Meat Export Federation (USMEF), nearly 40% of the U.S.’ red meat trade happens between Canada, Mexico and China. Overall, 6% of all U.S. cattle slaughter comes from Canada and Mexico while 5% of hog slaughter comes from Canada.
This is just one sector. Now, think about every product that deals with commodities, over-the-counter goods and vehicles. Canada has already responded with tariffs of their own while consumer-level stores have also responded by removing U.S. products off the shelves.
In a statement released by the Canadian Cattle Association last month ahead of the initial tariffs, they said, “Every day, $3.6 billion CDN in goods crosses the Canada-U.S. border, resulting in a $1.3 trillion annual trade relationship. Notably, Canadians purchase $722 USD/person of U.S. agricultural products each year while Americans purchase just $118 USD/person of Canadian agricultural products annually.”
Mexico, on average, has exported 1.15 million head of cattle annually, or just over 3% of the U.S. calf crop, according to livestock marketing specialist Derrell Peel. According to information shared with WLJ by USMEF, in response to the U.S. Section 232 metal tariff, Mexico imposed a 20% tariff on U.S. pork cuts in 2018, leading to an estimated $1.3 billion loss in reduced prices for ham and shoulder cuts and decreased export value. But why was a tariff placed on pork to retaliate metals? Mexico consumers consume nearly 50% of the hams produced in the U.S.
From a value standpoint, Canada, Mexico and China accounted for 37% of hog value and 15% of cattle value last year, according to data shared by USMEF.
So, here’s the thing we have to remember. As of today, it’s scary and could have lasting impacts. Immediately, the consumer will feel the first impact in the coming weeks, and as time goes on, all sectors will feel the overall impacts, much of which we don’t have the answers to at this time. And that is, to me, what is creating the fear. We don’t know what this will do to all sectors of agriculture—or even our entire population.
What I personally am relying on, and why I felt compelled to share this in this column, is that I am trusting the process. I am placing a belief that the president and his administration is taking a major leveraging piece and placing that on the negotiating table. While this is one of the most uncomfortable positions to be in knowing our producers’ livelihoods are being used in these negotiations, I am trusting this administration to ultimately set the U.S. up for a better future.
For me, I have to look at his track record. Time and time again, he has made statements that didn’t make sense at the time, but then later came to be true. I do feel this administration is working to secure better business deals for U.S. producers. The difference between Trump and the rest of us is how he goes about his business. It’s not how most people would conduct their dealings, but I have to trust that the outcome will be for the overall betterment and security of this nation and the business dealings will be fair. This isn’t a party line negotiation. We are all on the table right now; we just have to wait out the situation for now. — LOGAN IPSEN
