Canada could move $12 billion worth of food and beverage exports to countries other than the United States, said a new report from Farm Credit Canada.
“Diversifying food and beverage exports beyond the U.S. will not only strengthen producers’ resilience but also benefit Canadian consumers and the broader economy,” wrote FCC president Justine Hendricks in a news release.
More than 75 per cent of Canadian exports went to the U.S. in 2023 and 65 per cent of food and beverage imports came from the U.S.
The U.S. also accounted for 78 per cent of primary agricultural imports.
“This reliance leaves Canadian ag and food producers vulnerable to unpredictable trade dynamics,” said the FCC.
“The U.S. economy will always remain a key market for Canadian exports, but the evolving trade landscape underscores the need to diversify.”
FCC recommended strengthening interprovincial trade by redirecting $2.6 billion in exports from the U.S. to meet domestic needs.
It also said more should be done to maximize benefits from Canada’s existing trade agreements with 51 countries.
And it called for new partnership deals with countries in Europe, Asia and Latin America.
It said there are opportunities to diversify exports in categories such as prepared foods, vegetable oils and animal feed.
Prepared foods are a priority because they account for 19 per cent of Canadian food and beverage exports.
“Investing in infrastructure, innovation and expanding product offerings will be critical to supporting this transition,” said FCC chief economist J.P. Gervais.