**Canada’s Geopolitical Missteps Costing Farmers Dearly**

**Canada's Geopolitical Missteps Costing Farmers Dearly**

"Canada's constant squabbles are proving untenable—our farmers are now bearing the brunt of Ottawa's misguided trade strategies."

Canada has found itself embroiled in an unnecessary trade conflict with China, the United States' largest geopolitical competitor. The implications are stark: new retaliatory tariffs from China are hitting our farmers hard, impacting over $3 billion worth of agrifood commodities and products. These measures stem from Canada's decision to impose a 100% tariff on Chinese electric vehicles (EVs) last October—an attempt to align with U.S. trade policies and protect the North American auto industry from cheaper imports. However, the political landscape has since changed: with Joe Biden out of office and Donald Trump signaling a tougher stance against Canada, China is now retaliating against our agricultural sector.

This isn't the first time Canada has faced such backlash. In 2018, during the Huawei incident, China implemented similar strategies by restricting imports of Canadian canola, pork, and other agricultural products following the arrest of Huawei executive Meng Wanzhou in Vancouver. China's geopolitical maneuvers are strategic and effective, targeting industries that can exert pressure on the Canadian government. By contrast, Canada's trade policy often reacts to events rather than employing a coherent, long-term strategy.

Now, China is once again sending a pointed message by targeting our farmers in response to an EV tariff—even though Canada has yet to import a single Chinese-made electric vehicle. This action coincides with the appointment of a new prime minister replacing Justin Trudeau, the one who originally imposed the tariffs. The timing is telling, and it raises questions about whether Ottawa understands the broader implications.

Central to this dilemma is Canada's misguided approach to EVs—a policy that echoes the protectionist trends seen in the dairy industry. The federal government has invested over $50 billion into the EV and battery sectors, promoting domestic manufacturing and resource development. Key players benefiting from these investments include Volkswagen, Stellantis-LG Energy Solution, Northvolt, and Honda, among others. To safeguard these interests, Ottawa mirrored U.S. actions by imposing tariffs on Chinese EVs, inadvertently limiting market competition and increasing domestic EV prices over time.

This prompts a crucial inquiry: if the Canadian government truly aims to tackle climate change, shouldn't it focus on making electric vehicles (EVs) more accessible instead of obstructing cheaper imports? Rather than prioritizing environmental issues, Ottawa seems to be putting jobs in the auto sector first, which is quite inconsistent.

Currently, the EV and battery industries that Canada seeks to bolster are still in their early stages. We aren't bringing in EVs from China, yet it's our agricultural sector that's suffering the consequences of this misguided policy.

To give a clearer picture of the misallocation of funds, consider what could have been accomplished with the $50 billion that has been directed towards EVs and batteries. The beef sector, integral to Canada's food security, serves as a notable example.

With that $50 billion, we could transform the meatpacking industry. A mid-sized meatpacking plant requires about $200 million to construct, meaning this kind of investment could lead to the development of around 250 facilities, each capable of processing 500 to 2,000 cattle daily. Alternatively, larger industrial plants like those owned by Cargill and JBS typically cost about $800 million each. Thus, this investment could support roughly 62 substantial plants, each processing between 4,000 and 7,000 cattle every day. For comparison, Cargill's facility in High River processes 4,000 cattle daily, while JBS's Greeley plant in the U.S. manages around 5,000. Such an investment would not only decentralize the North American meat supply chain but also stimulate competition and enhance food security by decreasing reliance on a few dominant processors.

The short-sightedness in Ottawa's trade and industrial strategies is striking. A nation that controls its food supply wields significantly more economic and strategic power. China recognizes this well. The key question remains whether Canada's next government will grasp this lesson before further harm is inflicted on our agricultural sector.
Source@food processor