Quebec premier vows to protect dairy farmers, supply management in response to new tariffs threat

Quebec premier vows to protect dairy farmers, supply management in response to new tariffs threat

Impact of tariffs threat lies more in the uncertainty they create, expert says

Quebec premier says supply management 'non-negotiable' in U.S. trade talks

Quebec Premier Christine Fréchette, responding to the new tariffs threat hitting Canada from the White House, says the supply management system is non-negotiable.

On Monday evening, U.S. President Donald Trump announced his administration will be imposing tariffs of 50 per cent on a wide range of Canadian exports in 30 days' time.

Prime Minister Mark Carney has since said the two leaders have agreed to intensify trade discussions in the coming weeks.

Speaking ahead of the premiers' meeting in Charlottetown on Tuesday morning, Fréchette said she will take the time to review the incoming tariffs. She has asked for a meeting with Carney later this week to discuss the impact on Quebec.

Carney says Trump agreed to 'intensify' trade talks after 50% tariff threat

“I will defend and protect Quebec’s economy, Quebec’s workers, Quebec businesses until the end,” Fréchette said.

The tariffs would target a wide range of Canadian exports, from alcohol to hockey equipment to dairy products.

Canada’s dairy industry has long been a sore point for Trump, who sees the protectionist policies behind the supply management system as “discrimination” against the U.S., a position outlined in one of three presidential proclamations published Monday.

In another, Trump directly calls out Quebec's ongoing restriction on U.S. alcohol sales. Fréchette has previously said she has no intention of putting those bottles back on the shelves anytime soon.

Impacts on hockey company, dairy farmers

The president of Force Hockey, Hugo Lacasse, says the news of a fresh round of tariffs didn't quite surprise him, but finding hockey equipment on the list of targeted products did.

Lacasse says tariffs have already been difficult to navigate over the last year. Sometimes he wouldn't know a product was tariffed until it reached the customer's door.

"It's very complicated to ship to the USA, and there's some unpredictable tariffs that come out of nowhere," he said, saying import sheets don't always specify exactly why a product was tariffed.

These "invisible tariffs," as Lacasse calls them, forced him to shift away from the U.S. market around six months ago. Now, Force Hockey's business in the U.S. makes up less than 10 per cent — and is mostly concentrated in Democratic states — compared to around 30 per cent before the trade war.

Recently, Force Hockey's customer base has expanded to include Europeans, which has helped to compensate for the reduction in U.S. sales.

So, Monday's news will have little impact on Lacasse's bottom line, he says.

"In the future, we will have to take a decision if we stop directly [shipping] to USA," he said.

Angus MacKinnon, a dairy farmer based in Coaticook, Que., said the Canadian government should “stand tall” in the face of the new threats. Quebec is the country’s largest producer of milk, according to Les Producteurs de lait du Québec.

“We feel as if we’re a pawn in the whole negotiations tactics of Mr. Trump,” MacKinnon told CBC’s Daybreak on Tuesday morning.

Quebec premier defiant as businesses brace for Trump’s new 50% tariffs

He said the fate of the supply management system is what worries him as the U.S. ramps up economic pressures.

Why Trump is threatening new 50% tariffs on Canadian exports right now

“Canada has adopted a quota system, back in the '70s, and it was to support the dairy farmer to protect [them] from the variations and the fluctuations in the market,” MacKinnon said.

“There are margins that we have to produce within in order to supply the Canadian consumer with the quality product and not have these large, large surpluses and dump it onto the international market."

If U.S. dairy farmers were to enter the Canadian market, then producers like MacKinnon would be at a disadvantage given the differences in climate and environmental regulations between the two countries, he said.

New tariffs would only hit 5% of exports, says expert

Diya Jiang, a McGill researcher specializing in international trade, said this newest round of tariff threats will have a greater impact on Canada-U.S. relations than actual exports.

“Some economic analyses have shown that this actually only hits about five per cent of all Canadian exports," she said. "This is really a result of the … U.S. administration having exhausted their options. There have already been a lot of tariffs."

What will undeniably hurt Canada is the uncertainty the recurrent threat of tariffs signals to other countries wishing to do business here, she added.

And that uncertainty is making victims at home as well, she said.

"It makes it very difficult for small businesses to make decisions given that there's so much uncertainty associated with the market."

Cassandra Yanez-Leyton is a journalist for CBC News based in Montreal. You can email her story ideas at cassandra.yanez-leyton@cbc.ca.

With files from Peter Zimonjic, Sarah-Kate Dallaire and Gloria Henriquez