Call it the Crisis at the Farm gate.
Alberta farmers were reeling Thursday morning as they faced down a double-edged trade crisis as tariffs from both the United States and China threaten the country’s two largest agricultural export markets, putting billions of dollars in sales — and the future of family farms — at risk.
And it comes just weeks ahead of spring seeding, creating massive uncertainty over whether there will be markets to sell their crops.
That’s because China’s Ministry of Commerce announced a 100% tariff on Canadian canola oil and meal, along with a 25% duty on pork and seafood.
Canola is one of Canada’s most valuable agricultural commodities, contributing $43.7 billion annually to the economy and supporting approximately 40,000 farmers. The industry is heavily reliant on export markets, with China and the US being the top buyers.
“With uncertainty mounting with the United States, our largest export market, the last thing grain farmers needed was a trade war with China, our second-largest export market,” said Kyle Larkin, Executive Director of the Grain Growers of Canada (GGC).
“Together, the US and China account for over half of all Canadian grain exports — losing access or facing exorbitant tariffs in both markets at once is a threat farmers cannot afford to absorb.”
Canadian grain and oilseed producers were already grappling with rising input costs, high interest rates and increasingly restrictive government regulations. Now, they must contend with trade barriers that could drive down prices for their crops at a time when they are preparing to plant for the season.
The new Chinese tariffs are particularly painful for canola farmers, who remember a similar trade dispute in 2019 when China restricted canola imports after Canada detained Huawei executive Meng Wanzhou at the request of the US.
China is the second-largest buyer of Canadian canola products, purchasing $5 billion worth of seed, oil, and meal in 2024 alone.
“New tariffs from China on Canadian canola oil and meal will have a devastating impact on canola farmers and the broader value chain at a time of increased trade and geopolitical uncertainty,” said Chris Davison, President & CEO of the Canola Council of Canada (CCC). “We urge the federal government to immediately engage with China, with a view to resolving this issue.”
Despite public statements condemning China’s actions, the federal government has not yet announced any concrete measures to assist affected farmers. Agriculture Minister Kody Blois and two other federal cabinet ministers issued a joint statement promising to support “hard-working Canadian farmers,” but offered no details on financial relief or trade negotiations.
Likewise, Alberta Agriculture Minister RJ Sigurdson has urged the federal government to engage in talks with China, though he stopped short of criticizing Canada’s decision to impose tariffs on Chinese cars. The Alberta Canola trade group has asked Ottawa to compensate farmers directly, warning that without support, many could face financial ruin.
The escalating trade war stems from Canada’s decision to follow the US in imposing a 100% tariff on Chinese electric vehicles, along with a 25% duty on Chinese steel and aluminum. The move was intended to protect Canada’s growing EV industry, but it has triggered strong backlash from Beijing.
“Farmers are being treated as collateral damage in international trade disputes,” said Larkin. “We’re calling on the government to take immediate action — first, to engage with China to find a resolution and, second, to establish a compensation plan to cover the financial losses farmers are facing.”
But Jim , president of Lethbridge-based Marketplace Commodities said it could have been worse. That's because the tariffs are only on the seed oil and meal, not the seed itself.
China's timing of the announcement would have also had a much more detrimental effect if it had come when crops were already in the ground.
Coming now instead of June gives farmers extra time to make planting decisions for this year's crop. It also came late enough to give Chinese buyers plenty of time to stock up on their own canola supplies and buy what they need.
That means what's left of the 2024 crop will be unscathed.
"For the majority of them (farmers), I don't think it's something necessarily today to wake up and it's like this is costing money today, right?" he said. " "It's more on the remainder of their crop, and then on next year's crop, where it will have an impact."