Detailed Analysis of Canadian Tariffs on U.S. Goods Effects on the Poultry Industry as of March 31, 2025

This article provides a comprehensive overview of the effects of Canadian tariffs on U.S. goods from the poultry industry, drawing from various reputable sources to ensure a thorough understanding of current developments. The analysis covers the tariff regime, trade data, industry impacts, and potential market dynamics, offering insights for stakeholders and enthusiasts like myself.

Context and Background

On March 4, 2025, the Government of Canada imposed 25% tariffs on $30 billion worth of U.S. goods in response to U.S. tariffs, as detailed by Canada’s List of Products Subject to 25% Tariffs. This action was part of a broader trade dispute, that we can safely now call “Tariff Wars” with Canada, aiming to protect its economy and jobs. The tariffs are effective as of 12:01 a.m., March 4, 2025, and will remain in place until the U.S. eliminates its tariffs against Canadian goods, allegedly.

The poultry industry is particularly affected due to Canada’s supply management system, which includes tariff rate quotas (TRQs) for poultry imports. Under this system, certain quantities can be imported at low or zero tariffs (within access commitment), while imports exceeding these quotas face significantly higher tariffs (over access commitment), often exceeding 200%.

Existing Tariff Regime

Canada’s poultry import regime is governed by TRQs under the World Trade Organization (WTO), the Canada-United States-Mexico Agreement (CUSMA), and the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP), as outlined by Canada’s Poultry Import Regime. Specific tariff rates include:

• Chicken: Within access commitment rate: 0% or 2%, Over access commitment rate: 230%
• Turkey: Within access commitment rate: 0%, Over access commitment rate: 230%
• Broiler hatching eggs and chicks: Within access commitment rate: 0%, Over access commitment rate: 230%
• Egg products: Within access commitment rate: 0%, Over access commitment rate: 230%

These high over-quota tariffs are designed to protect domestic producers and manage supply, but they already pose challenges for U.S. exporters.

New Canadian Tariffs and Poultry Inclusion

The new 25% tariffs apply to a list of U.S. goods, and analysis of the tariff schedule confirms that poultry products are included. The list, as per Canada’s List of Products Subject to 25% Tariffs, includes various tariff items related to poultry, such as:

This table illustrates that poultry products, both within and over the access commitment, are subject to the new 25% tariff, in addition to their existing duties. For products within the access commitment, this adds a significant cost; for those over the access commitment, the total duty could reach 255% (230% existing + 25% new), making imports nearly nonviable.

Trade Data and Market Significance

The United States is a major supplier of poultry to Canada, with historical trade volumes indicating significant export values. According to USDA Poultry and Products Annual Reports, in 2024, U.S. poultry exports to Canada were substantial, with projections for 2025 showing modest growth. Specific figures include:

• Calendar year 2024 import tariff rate quota volumes exceeding 116,000 metric tons (MT), with over 53,000 MT available exclusively to U.S. suppliers under CUSMA.
• The U.S. maintaining a greater than 80% share of total Canadian chicken meat imports in recent years.

Given the additional tariffs, these export volumes are likely to decrease, impacting a market worth billions annually.

Industry Impact and Economic Repercussions

The new tariffs are expected to have several direct and indirect impacts on the U.S. poultry industry:

1. Reduced Exports: Higher tariffs will make U.S. poultry less competitive in the Canadian market, leading to reduced demand and lower export volumes. This is particularly acute for over-quota products, where the combined tariff rate could render exports uneconomical. Estimating reduced exports temporarily, until other markets have presented themselves.
2. Economic Challenges: Decreased exports could result in lower revenues for U.S. poultry producers, potentially leading to job losses and reduced production. The poultry sector, already facing global competition, may see further strain.
3. Market Dynamics: Canadian consumers and businesses might shift to domestic products or imports from other countries, such as Brazil or the European Union, further impacting U.S. market share. This shift could be accelerated by the “Shop Canadian” movement, as reported by CNBC on Canadian Nationalism.
4. Long-Term Trade Relations: The ongoing trade dispute could lead to negotiations or further escalations, affecting long-term trade relations and market access. Industry experts warn that retaliatory measures often harm farmers more than they help..

Statements from Industry Associations

Industry associations have expressed concerns over the new tariffs:

• The National Chicken Council (NCC) has highlighted the importance of the Canadian market for U.S. chicken producers and the potential negative impacts of increased tariffs, as seen in their statements on trade policy.
• The U.S. Poultry & Egg Export Council (USAPEEC) has emphasized the need for fair trade practices and open markets to support U.S. agricultural exports, noting the risk to market development efforts.

Additional Context and Analysis

The analysis considered potential overlaps, such as the February 2025 reports of Canada imposing tariffs on U.S. poultry and pork, as reported by Poultry Producer and Swineweb.com. These reports suggest an earlier action, possibly in response to U.S. tariffs on steel and aluminum, but the March 4, 2025, tariffs are the current focus and include poultry products explicitly.

The selection process involved identifying significant events and articles, prioritizing those with direct implications for the poultry sector, such as production, trade, and economic impact. Efforts were made to verify dates and relevance, with a focus on news directly impacting the international poultry industry.