Because United States President has been erratic in his announcement and imposition of tariffs, it’s difficult to know the impact on Canadian prices next week, month or year.
It’s also difficult to know whether commodities could actually cross the border to fulfill contracts.
And it is not only U.S. tariffs on Canadian commodities that impact Canadian prices.
Mussell provides the example of China’s tariff on U.S. pork which has stopped exports of offal to China.
The offals are being rendered instead and at lower returns, so U.S. hog prices are depressed.
But Canadian pricing is, in most instances for pigs, linked to the U.S. price, Canadian hog prices have been pressured lower.
Mussell writes that It would be challenging to establish a Canadian futures market for commodities other than the grains and canola already trading on the Winnipeg exchange.
He said farmers and food companies that rely on hedging and contracts will need to wait to see how traders work out a system to deal with the new challenges surrounding the global trade war.
