trade

BEIJING — It’s unclear if President Trump’s elaborate reception of his Chinese counterpart in Washington dazzled President Xi Jinping, but for the Chinese public, it made quite an impression.

Trump’s rare welcome of Xi and his wife, Peng Liyuan, at the airport, as well as the bilateral and cultural events the leaders attended were closely covered — and praised — by Chinese state media. Those who watched at home saw a China elevated in status.

“I read the news that the U.S. reception standards for President Xi are very high,” Xiang Ziyu, a postgraduate student in Beijing, told The Associated Press. “I’m quite impressed because it shows that our country has become really powerful.”

That takeaway was shared by several people interviewed by the AP as well as in comments on Chinese social media, which praised China’s cooperation with the United States.

The official People’s Daily newspaper allocated the entire front page to the trip, featuring six photos of the Xi-Trump meetings.

Meanwhile, on the Chinese search engine Baidu, the three most popular search topics on Friday were the talks between Trump and Xi; the state dinner attended by Xi and Peng; and greetings extended by Xi to Chinese people on the occasion of the Mid-Autumn Festival being celebrated on Friday.

Shen Zuohang, a Beijing resident, felt reassured by the coverage and by Trump and Xi’s seeming agreeability on topics like trade, artificial intelligence and security.

“We have no trade war and no military conflict. Even on the issue of Taiwan we are moving in a good direction instead of having heated confrontation,” Shen said.

“The two sides are handling issues in a more acquiescent way.”

According to China’s Foreign Ministry, Xi called on Trump to oppose the independence of Taiwan, an island democracy China claims as its own territory, and to handle the issue with caution. Trump did not immediately make comments on Taiwan, but had previously described U.S. arms sales to the island as open to negotiations with China.

Xiang, the student, said the summit overall sent a positive signal and will help improve the Chinese public’s opinion of the relations between the two countries.

“It is better than not communicating,” he said.

Associated Press video producer Wayne Zhang in Beijing and writer Simina Mistreanu in Taipei, Taiwan, contributed to this report.

WASHINGTON — President Trump’s trade war with Canada could intensify the headwinds Republicans are navigating ahead of the November midterms, with its effects poised to reverberate in northern battleground states with crucial Senate races.

With the election less than six weeks away, Republicans are facing an increasingly bleak outlook, as new polls this week showed voters favoring Democrats by as much as 12 points amid widespread cost-of-living anxiety and low approval for Trump.

The escalating beef with Canada — Trump attacked the country anew on social media Wednesday — stands to heighten voters’ economic worries and add to the GOP’s political challenge in dead-heat races, analysts said.

“It doesn’t make things easier. It’s not helping,” said Rusty Hills, a University of Michigan public policy professor and onetime chair of the Michigan Republican Party.

The president’s unpopular policies on the war in Iran, the economy and data centers have already handed Republican candidates the tough task of appearing responsive to Americans’ frustration with cost-of-living issues without alienating Trump and his voter base.

The trade war, said Lance Dutson, a Maine Republican media strategist, puts “another log on the fire” of the affordability issue.

The tariffs have appeared unpopular in recent polling, including among a majority of independent voters. Though they are not expected to dramatically increase consumer prices, they could affect voters’ perception of the economy — and even small economic impacts on certain industries, such as auto manufacturing in Michigan, could have an effect in very close midterm races, experts said.

Trump’s new import bans on some Canadian goods are set to begin next week, a response to retaliatory tariffs Canada levied earlier this month. Trump argues that Canada has “been ripping off” the United States and that tariffs will help domestic manufacturers.

On Wednesday, the president inaccurately claimed on Truth Social that Canada is allowing “millions and millions” of immigrants into its country.

“It is a Liberal takeover that will end very badly. Already showing up in their numbers. Big unemployment. ‘Oh Canada!” the president wrote on social media Wednesday morning.

Five of the nine states most likely to decide Senate control border Canada — Alaska, Ohio, Michigan, New Hampshire and Maine. Two more, Texas and Iowa, also do substantial trade with Canada.

Democrats must retain their Senate seats including New Hampshire and Michigan and flip four of the other states to win a majority, a tall task. As the landscape worsens for Republicans, however, some are testing how much they can distance themselves from Trump.

“It’s a tightrope, there’s no question,” Hills said. “[Candidates] are looking for some wiggle room on some of these issues like the war and prices and Canada tariffs, because they need every independent and swing voter they can get.”

A majority of Americans oppose raising tariffs on Canadian goods, including 64% of independents, an Economist/YouGov poll found. Only 14% of independents said they supported additional U.S. tariffs on Canada in a late August Ipsos poll.

And in Michigan, 68% of independent voters disapprove of the tariffs, a poll this month from the Washington Post and Schar School found.

“The more we put tariffs on stuff, the more they put tariffs on stuff … prices are just ultimately going to go up for all of us,” said one Michigan swing voter in a Sept. 9 focus group conducted by the firm Engagious, in which 11 of 13 participants said the trade war was bad for the state.

The highest costs of the tariffs will be concentrated within a few industries, including auto and other manufacturing, dairy, and alcohol and spirits, said Alex Durante, a senior economist at the Tax Foundation. The tariffs likely won’t create a major change for consumers, but the general impression that tariffs can contribute to higher prices might turn off voters who are already worried about inflation, he said.

Counter-tariffs imposed by Canada in response to U.S tariffs last year resulted in a 6% increase in the prices of affected goods, researchers found in paper published by the Journal of Monetary Economics.

Canadian lumber products at Gutherie Lumber in Livonia, Mich., in August.

(Paul Sancya / Associated Press)

“This trade war is certainly not helping the president and his party in the midterms,” Durante said. “What’s weighing on the top of people’s minds is this general affordability crisis … and they realize that tariffs are another factor that is impacting affordability.”

The latest escalation of the trade dispute began in July, when Trump threatened new 50% tariffs on some Canadian goods, reinvigorating a conflict that began with tariffs the president imposed in 2025.

The two countries began trade talks, but the negotiations fell apart in late August, and Trump imposed tariffs on about $20-billion worth of Canadian goods. Canada retaliated with tariffs on about $20-billion worth of American goods that took effect Sept. 8. Trump then announced import bans on some Canadian goods, including certain alcohol and dairy products, which go into effect next week.

Construction and farm equipment in Illinois, aluminum and pipe products in New York, and iron and steel products in Ohio are among the goods targeted by Canada’s counter-tariffs, the Canadian Broadcasting Corp. reported. In California, about 10.5% of the state’s Canadian imports are exposed to the counter-tariffs imposed by Canada.

Democrats have seized on the issue as another way to tie Republican candidates to Trump’s policies, something that analysts said may have varying degrees of success in different swing states.

Maine Republican Sen. Susan Collins campaigns in August in Kittery, Maine.

(CJ Gunther / Getty Images)

In Maine and New Hampshire, where the Republican Senate nominees have criticized Trump’s move, the tariff issue may be less likely to stick. Efforts to tie Republicans to Trump have historically been less successful in the region because of its independent streak, said Jim Merrill, a veteran Republican strategist in New Hampshire.

Maine Republican Sen. Susan Collins warned the White House against imposing tariffs and successfully pushed for the administration to exempt road salt and cement this month. She told Politico that the Trump administration had “very much underestimated” the effect of the tariffs on Maine residents.

Republican John Sununu, a former senator who is running to retake the seat in New Hampshire, has also criticized the tariffs, saying a trade war with Canada “doesn’t make any sense.” He indicated he would support legislation in Congress to restrain the president’s tariff powers.

Elsewhere, Senate nominees have walked a careful line on tariffs. In Alaska, Sen. Dan Sullivan has largely avoided the issue, even as Democrats there have used it to ramp up attacks on his record in recent days. In Ohio, former Sen. Jon Husted told the National Review in August that the public “would like to understand the strategy behind what the president’s trying to do.”

Former Rep. Mike Rogers of Michigan, the Republican Senate nominee, told reporters over the weekend that he was in favor of “good” tariffs that would help Michigan and opposed to “bad” tariffs that would hurt the state.

Focusing on issues other than tariffs may be the right strategy on the campaign trail, Hills said.

“He’d much rather be talking about the Republican plan for affordability,” Hills suggested. “There’s interesting things we need to be talking about in order to win this election, and this isn’t one of them.”

The red carpet was rolled out, and a trade truce was extended. Yet, beneath the pomp and pageantry of Chinese President Xi Jinping’s state visit with US leader Donald Trump on Thursday, Washington and Beijing remain locked in a much deeper strategic rivalry.

Xi arrived in Washington, DC on Wednesday evening for talks on Thursday, and Trump was there to meet him personally on the tarmac.

The meeting was the first state visit by a Chinese leader to the US in 11 years. But it is also the third time in less than a year that the two men have met face to face, as the two powers remain uneasily gridlocked in competition over AI, rare-earth metals, the question of Taiwan, and the Iran war.

Overhanging it all is the paused, but simmering, trade war between their two nations.

Almost as soon as Trump began his second term in the White House in January 2025, up went tariffs on Chinese goods as he accused China of facilitating the flow of fentanyl, a deadly drug, to the US. Beijing responded with its own levies, then restricted exports of valuable rare-earth metals which are crucial for the development and manufacture of everything high-tech, from smartphones to fighter jets. At one point, tariffs were heading towards 150 percent before being paused to allow time for talks.

Finally, the two leaders called a truce on the sidelines of the Asia-Pacific Economic Cooperation (APEC) summit in South Korea on October 30, and they met once more, in May, when Trump travelled to Beijing.

As Xi landed in Washington on Wednesday this week, the Trump administration announced that the two countries had agreed to extend an October 2025 truce which had offered some respite from the punishing tariffs, produced an agreement from China to buy more soyabeans from the US and delayed the ban on rare-earth exports from China until January 10. The prospect of a much-longed-for trade deal appeared to be in the air when US Treasury Secretary Scott Bessent told Fox News he had met Chinese ‌Vice Premier He Lifeng before Xi’s visit to “see if we could ⁠do a bigger deal as opposed to just a series ⁠of smaller things”.

But analysts have, for the most part, shot down such hopes. Beyond tariffs, they say, the simmering conflict between the two powers now encompasses new US sanctions on buyers of Russian oil – namely China – and sweeping investment and research restrictions, never mind the intensifying race for dominance in artificial intelligence.

“The two-month extension isn’t a bridge to a grand bargain – it’s a temporary sandbag holding back a structural flood,” Beijing-based Einar Tangen, a senior fellow at the Center for International Governance Innovation, told Al Jazeera.

Theatrics or continued thaw in tensions?

In fact, the truce is little more than “transactional theatre” – an attempt at good optics before the upcoming US midterm elections – Tangen said.

Trump’s deeply unpopular war on Iran has already inflicted severe damage to his chances in that vote. Democrats are leading in the polls amid concerns about the rising cost of energy, triggered by the war which the US started. Trump ultimately needs wins on other issues.

The current truce with China serves a purpose, therefore, but is fragile enough to be undone the moment political utility shifts for Trump, Tangen said.

“Success in January won’t be measured by what is solved, but by whether the knot is left tight enough to hold, but not kill,” said Tangen.

Phillippe Le Corre, professor of international relations and Asian studies at France’s ESSEC Business School, said the length of the truce extension indicates clearly that a more permanent deal remains out of grasp.

“The extensions are getting shorter and shorter, which means they haven’t found a common ground on many issues,” Le Corre told Al Jazeera.

“The two-month extension is a terrible outcome for the US. Nothing is resolved, and many Damocles’ swords are still hanging over Washington’s head,” he added.

Trump’s entire China policy, Le Corre argued, is in fact short-sighted. “That is bringing the world a lot of uncertainty,” he said.

Some analysts are more hopeful, but not much. Sun Chenghao, a fellow at the Center for International Security and Strategy at Tsinghua University in Beijing, described the extension of the trade truce as a “useful interim step”. It shows that both sides want to preserve the recent easing of tensions, which is meaningful progress, he said.

“From China’s perspective, a sustainable agreement needs reciprocal benefits and greater policy predictability,” Sun told Al Jazeera. “Additional purchases cannot indefinitely compensate for uncertainty over tariffs, technology restrictions and market access.”

The extension’s value, however, will depend on whether it produces “concrete commitments” from Beijing and Washington, Sun added.

A game of ‘economic chicken’

There is motivation to get a deal done, analysts say. Any escalation in the US-China trade war will be costly for both sides.

But there is some way to go. A Congressional Research Service report in July 2026 noted that Chinese goods exported to the US still face tariffs of 36.5 percent, while US goods entering China are taxed at 31 percent.

Any higher, and they will raise import and manufacturing costs in the US, squeeze margins and increase pressure on consumer prices, said Sun. They would also hurt US farmers and industrial exporters, he added, just as the US faces pressure from the rising costs of its war on Iran, which have pushed it into a record national debt of $40 trillion two years earlier than expected.

“Washington is playing a high-stakes game of economic chicken with a $40 trillion debt load, an inflationary sword of Damocles, zero fiscal cushion to absorb a truce collapse and a dependence [on] Chinese industrial and manufacturing inputs,” Tangen said.

US consumers and the economy in general will find it tough to survive yet another inflationary shock from renewed tariffs “at a time when the federal budget already operates like a high-wire Ponzi scheme”.

Then there is the AI race, which no one can afford to lose. According to Jon Bateman, a senior fellow at the Carnegie Endowment for International Peace, a partial “decoupling” of US and Chinese technology ecosystems is under way. US policymakers have pushed to become less dependent on Chinese tech and “to secure America’s technological future in the context of a rising China”, Bateman writes.

But that will not help if there is a collapse in valuations of companies in the AI sector, which currently drive global stock markets. An AI valuation collapse, Tangen warned, “could trigger a financial tsunami that makes 2008 look tame – making technological decoupling meaningless as the world is plunged into a depression”.

Despite the trade war and Trump’s tariffs, China’s trade with other countries has risen sharply, with the country registering a $1.2 trillion global trade surplus last year. But an escalation of the trade war with the US would nevertheless spell increased pressure on export orders, employment in exposed industries and business confidence, said Sun.

Beijing does hold one crucial ace card – it is sitting on 60 percent of the world’s known deposits of rare-earth minerals, said Le Corre. It processes 90 percent of them, too. These are the metals that all countries need supplies of for semiconductors, technological components and the manufacture of weapons, to name but a few. Last year, China began to make use of that leverage by restricting exports of five of the 12 rare-earth metals it mines in April. Then, in October, it prepared to restrict seven more – until the trade truce happened. Plans for the export restrictions are not shelved, however, merely on hold.

“[China] understood this over the past year and they are certainly not going to give up on this,” said Le Corre.

“Washington is hostile, but it is hooked,” Tangen said. “You cannot threaten China with secondary sanctions on energy while desperately needing its rare-earths to fuel your military-industrial base.”

A drawn-out path to durability

The path to a lasting US-China trade deal will be long and rocky. First, any new tariff reductions will need more coverage and duration, said Sun.

For a deal to last, it would also require “more predictable licensing and actual deliveries of rare earths and critical minerals; restraint in expanding technology restrictions; and market access reflected in regulatory approvals and completed transactions”, he said.

A durable agreement also needs regular consultations and a process for resolving complaints. If all this can be hammered out then, just maybe, there might be a chance, Sun said.

Tangen and Le Corre were less optimistic, however. “The US view of China as an existential threat has to change before there can be solutions,” said Tangen.

Le Corre, meanwhile, said that while China is a long-term planner, “durable is a word that can hardly be associated with Trump.”

The existing trade truce also risks breaking down if there are new unilateral tariffs, broader technology or mineral restrictions, or disputes over whether commitments have been fulfilled, said Sun.

Tensions over Taiwan, which China claims as its own territory, but for which the US approved an $11.1bn arms sale in December last year, could also trigger a breakdown in trade relations, the analysts said.

“Taiwan remains the ultimate low-probability, catastrophic-impact tail risk – where a single round of arms sales can snap a multibillion-dollar trade truce in an instant,” Tangen noted.

Published on 22/09/2026 – 11:54 GMT+2•Updated
12:00

The European Commission struck a trade agreement with the Philippines on Tuesday, stepping up its diversification strategy across the Indo-Pacific region.

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The deal comes more than a year after the US introduced sweeping new tariffs on many of its trading partners, prompting retaliatory measures and adding to global trade tensions.

Since then, the EU has been seeking new trade ties, recently concluding major deals with India, Australia and Indonesia.

“This agreement sends a clear signal that the EU is reinforcing its engagement with the Indo-Pacific,” EU Trade Commissioner Maroš Šefčovič said on Tuesday.

“Half of global consumers are covered by European Free trade agreements. Nobody else has this advantage.”

“Squeeze on supply chains”

The new agreement will give EU businesses access to a market of 113 million people, and remove over 94% of customs duties. It will cover more than 97% of bilateral trade, including EU exports of machinery, medicines and medical appliances, as well as agri-products such as meat, pork, poultry and spirits.

Exports from the Philippines are dominated by semiconductors, integrated circuits and industrial machinery.

The deal should also facilitate EU investment in raw materials in the Philippines, as the EU seeks to move away from China, which holds a monopoly on key raw materials.

Bilateral trade in goods between the EU and the Philippines was €17.6 billion in 2025, while trade in services reached €10.3 billion in 2024. The stock of EU foreign direct investment in the Philippines amounted to €15.4 billion.

Šefčovič also said there was a “mutual interest” with countries in the wider Indo-Pacific area “to address the current global turbulence” and “the squeeze on the supply chains.”

Brussels says China has weaponised critical products for EU industry such as chips and rare earths in 2025, jeopardising whole sectors such as the car industry.

The Commissioner added that trade deals with Thailand and Malaysia were next on the EU agenda, with an agreement with Bangkok foreseen by the end of the year.

The European Union and Canada last week unveiled plans for an ambitious new partnership that could eventually give Canada a form of associate EU membership. Yet their existing landmark agreement remains unfinished business.

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The Comprehensive Economic and Trade Agreement (CETA) was signed in 2016 and has applied provisionally since 2017, removing almost all tariffs and helping drive a sharp increase in transatlantic trade. But ten EU countries – Belgium, Bulgaria, Cyprus, France, Greece, Hungary, Ireland, Italy, Poland and Slovenia – have still not ratified it.

The contrast was underlined last week when European Commission President Ursula von der Leyen invited Canada to deepen its economic and security ties with the bloc.

“We will move from CETA to an Alliance for the Future to create a common prosperity and economic security space,” von der Leyen told MEPs and Canadian Prime Minister Mark Carney in Strasbourg.

Despite not being fully ratified, the deal provisionally entered into force in 2017.

But what is CETA and why is its ratification blocked?

What is in the EU-Canada trade agreement?

CETA was concluded in 2016 after seven years of negotiations and often heated debate across EU member states.

The agreement removed tariffs on 98% of goods traded between the EU and Canada, covering products ranging from wine and cars to chemicals. It also opened up more of the Canadian market to European companies in sectors including financial services, telecommunications and transport.

The Commission says the agreement boosted EU-Canada bilateral trade in goods and services by 80% in 2025 compared to 2016, when CETA was signed, reaching €130 billion, up from €72.1 billion recorded nine years before. The EU has a trade surplus of €16 billion in goods and €9,7 billion in services.

For agricultural products, it allows 143 European products with the status of geographical indications (GIs) to be sold in Canada, protecting them from imitation. The deal also includes quotas for EU cheese exported to Canada (32,000 tonnes per year), Canadian beef (50,000 tonnes) and pork (80,000 tonnes) to the EU. It also bans imports of Canadian products containing prohibited substances, such as growth hormones.

Only 3% of the beef quotas were filled between 2021 and 2023, due to the EU’s Sanitary and Phytosanitary (SPS) rules, which make it costly for Canadian beef producers to export, according to a Commission assessment.

Why is the ratification blocked?

Concerns over food safety and environmental standards are among the reasons CETA has faced resistance in EU countries. European farmers have also raised concerns about unfair competition from Canadian products, arguing that some of Canada’s production rules are less stringent than those in the EU.

CETA opponents also criticised the deal’s Investor-State Dispute Settlement provisions. Those let companies bring a claim against the state before an arbitration tribunal if its government adopts a law that discriminates against a company and harms its profits. The tribunals were ad hoc, composed of private arbitrators.

However, controversies around a system that might favour business lobbies led the Commission to include safeguards and replace the Investor-State Dispute Settlement mechanism with an Investment Court System with permanent judges and an appeal mechanism. The EU and Canada have also introduced provisions to safeguard their right to regulate policies aiming to protect public health and safety, the environment or social protection. But opponents say that the safeguards won’t be enough to protect such policies. It is planned that the courts will only come into force once the deal is ratified by all 27 member states.

When will the EU fully ratify the deal?

There is no clear timetable, not least because the ratification process is effectively blocked in several member states.

For instance, in France, the Senate rejected the deal in 2024, and the government then blocked its submission to the National Assembly, fearing a full rejection.

In Poland, the ratification process is also frozen, as well as in Italy, where it has been blocked since the government rejected it in 2018, considering Italian GIs were not given enough protection. Italian MEP Carlo Fidanza, from the Brothers of Italy party, recently said that there were few chances the deal would be submitted to parliament before the December 2027 elections.

Abbotsford, British Columbia – Every second day, 28,000 litres of raw milk leave Casey Pruim’s farm in Abbotsford in western Canada, entering a distribution system built on the assumption that the milk and the products made from it will have somewhere to go.

While most is consumed in Canada, some had been sold across the border to the United States.

Those sales have largely come to a standstill since US President Donald Trump’s 50 percent tariff on $20bn in Canadian goods, including dairy products, came into effect on August 22.

Pruim, who is also chair of the British Columbia Dairy Association representing about 400 dairy farmers across the province, told Al Jazeera that Canadian farmers do not individually decide which products are exported.

Instead, producers such as Pruim –  whose farm has 330 cows milked three times a day  –  sell into the provincial milk-marketing system, which distributes milk to processors according to demand, including for products exported to the US.

If a processor loses US demand, it may require less milk, with the impact then spread across the provincial pool.

Dylan Kruger, director of public affairs at BC Dairy, told Al Jazeera “there is still considerable uncertainty around the impact of the US tariffs”.

He said it was too early to know how the industry would be impacted or whether milk no longer sold to the US could be sold elsewhere, mitigating financial losses.

But the tariffs and wider trade tensions have already introduced uncertainty and instability for businesses.

“If the processor who’s exporting some of his product to the United States can no longer sell into that market because he’s now priced out of the market with a 50 percent tariff, that’s how it would impact the dairy farm,” Pruim said.

Pruim said if processor demand is squeezed, farmers would be forced to dump the milk. In the worst-case scenario, the herd has to be cut.

“Cows aren’t like a tap; you can’t just turn them on or off,” he said.

His warning captures dairy’s particular vulnerability in a tariff war: Milk is highly perishable, collected on a tight schedule and dependent on processors whose demand can change much faster than farmers can adjust production.

“These tariffs are completely unwarranted,” David Wiens, president of the Dairy Farmers of Canada, told Canada’s CBC News, adding that they would affect “the supply chain, not only in Canada but in the US as well”.

Supply-management system

Dairy trade between Canada and the US has largely operated under a free trade agreement between the US, Mexico and Canada, known as CUSMA in Canada.

Canada manages the supply of dairy, poultry and eggs through a national agricultural policy known as supply management. The system uses production quotas and import controls, including tariffs, to provide farmers with more stable and predictable prices while maintaining domestic supply.

Critics describe the system as protectionist and as a government-backed cartel.

Washington argues that Canada’s supply-management system restricts US dairy exports. Trump posted on Truth Social that “Canada had been ripping off the United States of America for years” and accused it of imposing “ridiculously high tariffs” that made life impossible for US farmers.

Canadian producers reject that argument, saying the existing trade agreement already gives US imports substantial tariff-free access that is not fully utilised.

Canada’s dairy trade deficit with the US has grown significantly since CUSMA came into force on July 1, 2020, according to the Dairy Processors Association of Canada.

In 2020, Canada exported 241.3 million Canadian dollars ($173m) in dairy products to the US and imported 647.4 million Canadian dollars ($462.7m) worth of dairy and dairy products. In 2025, Canadian dairy exports had risen to 308.7 million Canadian dollars ($220.7m) while dairy imports from the US had more than doubled to 1.355 billion Canadian dollars ($968.5m), accounting for 13.8 percent of total value of US dairy exports, according to the association.

Bryan Yu, chief economist at Central 1 credit union, said the immediate shock of losing a major market could be difficult for Canadian producers to absorb because replacement buyers cannot be found quickly.

“There is going to be pain in the near term for a lot of our producers,” Yu told Al Jazeera.

“You really can’t quickly adjust to a 50 percent tariff, because it’s uncharted waters for a lot of industries … and ultimately it shuts [Canadian producers] out, because a lot of them don’t have the margins that they can play with,” he said.

Yu said Canadian consumers might absorb some of the additional supply while exporters search for new markets and higher-value products, but neither adjustment is instantaneous.

“There are global markets as well, especially when you talk about chilled, chilled beef, chilled products and really it’s a question of whether … other types of markets that could be available.”

Canada has also imposed retaliatory tariffs, which came into effect on September 8 and cover $20bn worth of US products.

Dairy products are among the targeted goods. The list includes a 50 percent tariff on milk, cream and whey products and a 25 percent tariff on many cheeses imported from the US.

Canadian Prime Minister Mark Carney has framed Ottawa’s response as both retaliation and an attempt to build greater economic resilience.

Announcing the collapse of the latest negotiations, he said Canada would match Washington’s new tariffs “dollar for dollar” to protect workers, farmers, families and businesses.

But retaliatory measures carry risks of their own.

“Canada’s new retaliatory tariffs will help some industries but hurt most and weaken economic growth across the country by raising costs for producers and consumers,” Oxford Economics said in a report.

For now, geography remains important for perishable goods like dairy products that once moved quickly across the US border and cannot be redirected overnight to a distant market without new buyers, logistics and regulatory approvals.

Ottawa’s Trade Commissioner Service is advising affected companies to check their CUSMA compliance, explore available relief and contact trade commissioners about potential new markets.

Yu predicted that the US and Canada could reach a tariff deal in the following months but said the interim period could bring “higher prices, weaker economic activity and deeper mistrust”.

For Pruim, the uncertainty is as destabilising as the tariff threat itself.

“I think, like [for] any Canadian, it’s disappointing to have these trade talks collapse again and just the uncertainty around it.”