OTTAWA – Canadian dairy farmers are voicing strong opposition to any concessions regarding their sector as trade negotiations with the United States ramp up ahead of a looming tariff deadline set by President Donald Trump. A new round of 50 percent tariffs on various Canadian goods is scheduled to take effect on August 19, 2026. Notably, these tariffs lack exemptions for goods that adhere to the Canada-U.S.-Mexico Agreement (CUSMA).
The U.S. has identified Canada’s supply management system for dairy as a major point of contention in trade discussions. President Trump has consistently criticized the limitations placed on U.S. dairy farmers' access to Canadian markets. In response, Dairy Farmers of Canada is urging the federal government to resist any further concessions related to dairy or supply management in the ongoing talks. The organization emphasized that "our food sovereignty is not for sale; a bad deal is not worth the cost," highlighting past concessions made in favor of advancing CUSMA discussions that have only resulted in additional demands from the U.S.
Prime Minister Mark Carney reiterated his government's commitment to the supply management system in a statement on Thursday. Sources close to the negotiations noted that Ottawa has communicated to the provinces that major changes to the supply management regime are unlikely. However, Canada may consider offering broader access to the American market under existing terms.
The U.S. has persistently sought direct access for its dairy products to prominent Canadian retailers such as Walmart and Loblaw, similar to arrangements provided in a European Union trade deal that allows limited access for cheese. Yet, the likelihood of Canada granting such direct access appears low. Concerns linger that a surge in American imports could overwhelm the supply management system, and it may contravene Bill C-202, which restricts changes to the system during trade negotiations.
In addition to dairy, the U.S. has flagged several other trade irritants, including Canada’s “Buy Canadian” procurement policy, quotas on specific U.S. vehicles, and provincial bans on the sale of American alcohol. It is anticipated that provinces maintaining alcohol sales restrictions will continue to do so, with Ottawa suggesting they should retain these measures until favorable gains are secured in negotiations.
A document from the Office of the United States Trade Representative published in March cited barriers imposed by provincial liquor control boards as a significant impediment to U.S. exports of wine, beer, and spirits to Canada. Following the imposition of tariffs by Trump, several Canadian provinces ceased offering American alcoholic products. The U.S. is pushing for these products to be reinstated "immediately and permanently" in all markets.
The office of Quebec’s Minister of Finance stated that American products will remain excluded from the province’s liquor store shelves until a mutually agreeable deal is reached. They emphasized that the regulation of alcohol sales is exclusively a decision for the Quebec government.
As negotiations continue, Canada is also advocating for support for sectors heavily impacted by trade disputes, including steel, automotive, and forestry industries. Canadian-U.S. Trade Minister Dominic LeBlanc held meetings in Washington with U.S. Trade Representative Jamieson Greer, alongside various industry groups and senators. LeBlanc was expected to return to Canada, while Canada’s chief trade negotiator Janice Charette planned to remain in Washington over the weekend.
Chamber of Commerce CEO Candace Laing recognized that while deadlines can create anxiety, they often serve to drive negotiations forward. "I feel momentum in a way I haven’t before, and we need this momentum to break the cycle of uncertainty for business," she stated.
In the broader context, Siobhán Vipond, the executive vice-president of the Canadian Labour Congress, characterized the U.S. as a "bully" in these negotiations, advocating against concessions that could undermine Canadian standards and jobs. She stressed that it is preferable to lack an agreement rather than compromise too much.
The current round of discussions stems from the renegotiation of CUSMA, which replaced the former North American Free Trade Agreement. Following a recent announcement by the Trump administration regarding the lack of an extension for CUSMA, annual rolling reviews are set to commence, potentially extending for a decade unless all involved countries agree to an extension.
