Reducing U.S. market dependence in food, beverage exports daunting challenge

Opinion

Diversifying the Canadian economy has become central to almost any discussion about how to deal with our increasingly volatile next-door neighbour.

There’s growing recognition whatever emerges from the current U.S. administration’s reforms will bear little resemblance to the country and ally Canadians once knew. For the sake of our own survival, it’s time to move on.

Nowhere is that realization more critical than in food and agriculture.

Farm Credit Canada took a swing at quantifying just what it would take to achieve diversification in a newly released report that uses 2023 trade statistics as a starting point.

It identifies opportunities for Canada to shift $12 billion worth of agriculture and food exports away from the American market by focusing more on growing domestic demand and reducing interprovincial trade barriers, leveraging existing trade agreements with other trading partners and establishing new international partnerships.

If successful, it would reduce U.S. market dependence in food and beverage exports to 50 per cent of 2023 levels. It is a daunting challenge.

Sixty-eight per cent of Canada’s agriculture and food imports originate in the U.S., while 59 per cent of Canadian exports move south. Statistics also show 78 per cent of primary agriculture and 65 per cent of food and beverage imports came from the U.S., while 31 per cent of our primary product exports and 76 per cent of food and beverage exports move south.

While the size and scale of Canada’s dependence on the U.S. has increased, especially since the first so-called “free trade” agreement was inked in late 1980s, food and agricultural products in North America have always flowed north and south.

It’s a pattern archeological records show predates European settlement of the region. Food crops such as beans, corn, squash, potatoes and tomatoes followed these trade routes northward and were cultivated in what would become Western Canada centuries before the Selkirk Settlers arrived in the early 1800s.

Likewise, as a concept, a diversified approach to keeping food on the table and exporting the surplus to pay the bills has always been key to survival in these parts. It’s an under-acknowledged part of our shared history that we might learn from as we look to the future.

Dan Benoit, director of cultures and protocols at the Knowledge Circle for Indigenous Inclusion at Indigenous Services Canada, recently briefed the Canadian Farm Writers Federation on the role Indigenous and Métís Peoples played in setting the foundation for the modern agricultural economy.

It was their knowledge that supported the Selkirk Settlers’ survival, and their skills that fostered the food production and trading economy that evolved. Most of the first farmers from Europe didn’t stay, but their departure coincided with the merger of the North West Company and the Hudson’s Bay Company and the decline of the fur industry.

Unemployed fur traders picked up farming where the Selkirk Settlers left off until they were systematically dispossessed by the waves of new immigrants invited to the region by the Canadian government in the late 1800s.

Louis Riel Sr., a farmer and businessman in the Red River Settlement, was a key figure in breaking the Hudson Bay’s monopoly over trade of fur and agricultural goods from the region so a diversified economy could flourish.

The Métís practised agriculture but they also hunted, fished and ferried goods across the Prairies, along with anything else they needed to do to make a living. Their ability and willingness to sell goods and services to more than one buyer (in other words, trade) was pivotal to their way of making a living. Equally important, if not more so, was remaining true to their cultural identity and values.

What do we draw from our past as we head into an uncertain future? As the saying goes, it’s never been a good idea to put all our eggs in one basket. In the grand scheme of things, the past 40 decades of economic integration with the U.S. may prove to be a brief blip in the annals of history.

Canadians are about to learn which is stronger — the allure of that north-south economic flow or our commitment to our own culture and values.

Laura Rance is executive editor, production content lead for Glacier FarmMedia. She can be reached at lrance@farmmedia.com.