Canada has lost its global agricultural trading edge, RBC report says

financialpost.com:

Canada has become overly reliant on the United States for its agri-food exports over the years, which have quadrupled in value to more than $100 billion. However, the successful trade partnership — now threatened by President Donald Trump’s looming tariffs — has grown at the expense of Canada’s global competitiveness, according to a new report by the Royal Bank of Canada.

Until the early 2000s, Canada ranked fifth among countries involved in global agri-food trade. Today, it sits in seventh place, behind China and Brazil, with greater global competition expected in the decades ahead. If corrective measures aren’t taken, RBC’s report warns, Canada could fall even further — to ninth place by 2035. However, with the right investments and strategic trade partnerships, Canada can regain market share and improve its global positioning, RBC says.

“We are really heavily reliant on one trading partner, and the current relationship (with the U.S.) leaves us very vulnerable, in terms of what that means for the sector and for the sector’s growth,” one of the report’s authors, Lisa Ashton, said in an interview.

Currently, more than 60 per cent of Canada’s agriculture and agri-food exports go to the U.S. — which in turn accounts for 20 per cent of Canada’s agriculture and agri-food imports. That trade gap has grown due to a surge in agri-food processing investment by Canada over the last 20 years.

Ashton said Canada would not want to lose the U.S. as its main trading partner, especially given our proximity to the market. Walking away from that partnership would take years and years to untangle and will be very costly for both countries, she added.

Instead, Canada should look for ways to strengthen trade with the U.S., while