On March 8, 2025, China’s commerce ministry announced it will apply a 100% tariff on Canadian canola oil, oil cakes and pea imports, and a 25% duty on Canadian aquatic products and pork. The tariffs, which will go into effect on March 20, 2025, are being imposed in retaliation for Canadian tariffs on Chinese electric vehicles (EVs) and steel and aluminum products, introduced in October 2024. The announcement is another blow to Canada’s agriculture and agri-food industry, which was already braced for the impact of a trade war with the United States.

Canada and China trade blows

In October 2024, Canada imposed a 100% surtax on Chinese EVs. According to the federal government, the surtax was imposed in response to China’s pervasive use of non-market policies and practices, such as subsidization and lax environmental standards, to artificially lower production costs of Chinese EVs. Canada also imposed a 25% surtax on Chinese steel and aluminum products. A similar surtax was imposed on Chinese EVs by the United States under the Biden administration, and by the European Union.

In March 2025, China announced it was imposing retaliatory tariffs on over US$2.6 billion of Canadian agriculture and food products, which is scheduled to take effect on March 20, 2025. China will impose a 100% tariff on canola oil, oil cakes and pea imports, and a 25% duty on Canadian aquatic products and pork. Alongside the announcement of the retaliatory tariffs, the Chinese commerce ministry stated that “Canada’s measures seriously violate World Trade Organization rules, constitute a typical act of protectionism and are discriminatory measures that severely harm China’s legitimate rights and interests.”

What it means for Canadian producers

China’s announcement has opened a new front in Canada’s trade woes, with a trade war already underway between Canada and the United States. The tariffs have the potential to significantly affect Canada’s agriculture and agri-food industry. For instance, China is a highly valued market for Canadian canola and canola products. According to the Canola Council of Canada (CCC), in 2024 Canada’s canola exports to China were valued at CA$4.9 billion, including 2 million metric tonnes of canola meal, valued at CA$918 million, and 15,351 metric tonnes of canola oil, valued at CA$20.6 million. According to the president and CEO of the CCC, Chris Davison, “[n]ew tariffs from China on Canadian canola oil and meal will have a devastating impact on canola farmers and the broader value chain at a time of increased trade and geopolitical uncertainty.” Davison urged the federal government to engage with China immediately to resolve the trade dispute. The Canadian Federation of Agriculture (CFA) has also urged the federal government to do everything in its power to resolve its trade dispute with China and avoid tariffs on Canadian agricultural products. The CFA’s president, Keith Currie, noted that the Chinese tariffs “could not have come at a worse time as Canadian producers already combat unfair and unjustified trade actions from the United States.”

Canada’s pork industry is also bracing for the impact of a trade dispute with both China and the United States. According to Farm Credit Canada, Canada exported an average of 270,158 tonnes of pork to the United States from 2019 to 2023 and 262,363 tonnes of pork to China over the same period. According to René Roy, chair of the Canadian Pork Council, there has been volatility in pork prices since China announced it was imposing a 25% tariff on Canadian pork products.

Canada’s seafood export market to China is worth approximately CA$300 million. Certain fisheries, such as BC’s geoduck industry, are likely to close early in response to China’s 25% tariffs, while others are taking a wait-and-see approach. 95% of BC’s geoduck industry is currently sold to China, and is worth roughly CA$50 million. Other seafood producers, such as Nova Scotia’s sea cucumber and live lobster industries are also expecting to be hit hard by the tariffs.

Several Canadian premiers have urged the federal government to reconsider its tariffs on Chinese EVs in order to avoid China’s retaliation towards Canada’s agriculture and agri-food industry. According to Saskatchewan Premier Scott Moe, workers in the province’s canola crushing plants will lose their jobs if China moves ahead with its planned tariffs. Moe stated that “[t]here needs to be action by our federal government before any election call to engage with China to ensure the canola industry is not left in purgatory.” Moe also stated that the tariffs will result in a loss of the canola market share. BC Premier David Eby has also urged the federal government to reconsider its tariff policy, stating, “[w]e don’t want to get crushed between the two biggest economies in the world.” However, the federal minister of innovation, science and industry, François-Philippe Champagne, recently reaffirmed that Canada is not considering dropping the tariffs it imposed on China’s EVs and steel and aluminum products.

In response to increasing trade tensions with its two largest trading partners, Canada is turning inwards and focusing on reducing internal barriers to trade. Removing barriers to interprovincial trade would be a boon not only to Canada’s agricultural and agri-food sector, but to the economy as a whole. A 2022 report by the Macdonald-Laurier Institute estimates that eliminating interprovincial trade barriers could increase Canada’s GDP between 4.4 and 7.9%. Read our prior insight on “The impact of lower interprovincial trade barriers on Canada’s agriculture and agri-food sector” here. Industries impacted by China’s new tariffs are also seeking to expand trade with existing international trade partners, and accelerate trade efforts in new markets. Finally, producers are advocating for financial relief from the federal and provincial governments.

For more information on this topic, please reach out to the authors, Morgan Camley, Paul Lalonde or Kathryn Gullason, or a member of Dentons’ Litigation and Dispute Resolution group or National Regulatory Practice group, who have expertise in the agricultural and agri-food sector.

Visit our Navigating today’s shifting tariff and trade environment hub for additional resources.