(NewsNation) — President Donald Trump has said that Canada has tariffs in place at above 200% on dairy products imported from the United States. While this is accurate, it is a bit more complicated than that.
Trump’s post on social media read, in part, “Canada is cheating the United States Farmers on USMCA. In 2024, Canada retained Tariffs on various U.S. Goods, particularly in protected sectors like Dairy that are operated under a supply management system. Some examples of Canadian Tariffs on U.S. Dairy outside the limited quota include: Milk: Up to 243% …. Butter: Up to 298% …. Cheese: Up to 245%.”
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However, those Canadian tariffs on U.S. dairy imports apply only after the country hits a level of tariff-free sales. This is from a deal Trump negotiated in 2018 during his first term in office.
Is the United States close to exceeding the Canada dairy export quota?
According to the International Dairy Foods Association, the U.S. has never gotten close to exceeding the dairy quotas in the U.S.-Mexico-Canada Agreement.
Becky Rasdall Vargas, senior vice president of trade and workforce policy at IDFA, said: “Frustratingly, the U.S. has never gotten close to exceeding our USMCA quotas because Canada has erected various protectionist measures that fly in the face of their trade obligations made under USMCA.”
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Vargas thanked the Trump administration for its “efforts to hold Canada accountable on these protectionist measures.” She did, however, say that “a prolonged tariff war with our top trading partners will continue to create uncertainty and additional costs for American dairy farmers, processors, and our rural communities.”
CNN reports that in many categories, including milk, the U.S. is not even at half of the zero-tariff maximum.
Trump says Canadian tariffs rose during Biden’s presidency
According to CNN, Trump claimed that Canadian dairy tariffs were “well taken care of” when his first presidency ended, “but under Biden, they just kept raising it.”
However, Canada did not raise these tariffs during Biden’s presidency, according to official Canadian documents obtained by CNN, as well as industry groups on each side of the border. Those tariffs were left in place after the USMCA deal made by Trump in 2018, which he has called “the best trade deal ever made.”
Al Mussell, an expert on Canadian agricultural trade, told CNN: “The U.S. has precisely this same system for its dairy market. It has tariff-rate quotas, and beyond that volume, very stiff tariffs and almost no imports.”
Why is the US putting tariffs on Canada?
Trump has given a variety of explanations for targeting Canada in recent weeks. He has said that his separate 25% tariffs on all imports from Canada, some of which are suspended for a month, are about fentanyl smuggling and objections to Canada’s taxes on dairy imports that he says penalize U.S. farmers.
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As a result of the tariffs, Canada originally placed a 25% tariff on electricity, affecting three U.S. states. However, that has since been suspended after a “productive” conversation with U.S. Commerce Secretary Howard Lutnick.
Trump’s tax increases on imports have been followed by stock market losses and fears of a recession.
