FCC proposes bold three‐pronged strategy to diversify Canadian agri-food exports
A major sector of Canadian industry should adjust its export strategy in response to current US trade policy, according to a Crown corporation.
Farm Credit Canada (FCC) is urging a major rethink of how Canadian food and beverage products are sold abroad, warning that heavy reliance on the United States leaves the industry vulnerable.
Almost 80% of Canadian food and beverage exports currently go to the US compared with just 31% of primary agriculture. Meanwhile, 65% of food and beverage imports come from south of the border.
FCC says this imbalance exposes producers to policy changes and trade disruptions and in its new report, “The $12-billion trade shift: Canada’s opportunity to diversify food exports beyond the US”, it outlines ways to spread exports across more markets and strengthen the country’s food system.
To address the risk, FCC is recommending three key moves:
- Increase domestic trade: Redirect about $2.6 billion worth of exports from the U.S. to Canadian markets.
- Leverage trade deals: Better use Canada’s 15 agreements covering 51 countries.
- Target new markets: Pursue $9.4 billion in sales growth across Europe, Asia, and Latin America.
Prepared foods are a major focus. They represent 19% of Canadian food and beverage exports ($8.6 billion in 2023), but 90% of that goes to the US. FCC suggests redirecting some of this to Canadian consumers before expanding into other international markets.
“Canadian agriculture and food producers rely on international trade to thrive, but ongoing trade disruptions have created uncertainty and barriers to growth. Diversifying food and beverage exports beyond the US will not only strengthen producers' resilience but also benefit Canadian consumers and the broader economy,” says Justine Hendricks, FCC president and CEO.
“Investing in infrastructure, innovation and expanding product offerings will be critical to supporting this transition. Shifting $12 billion in exports will reduce risk and secure stability for the Canadian agriculture and food sector,” added J.P. Gervais, FCC's chief economist. “A balanced trade portfolio will make the ag and food industry more competitive, adaptable and prepared to succeed in a changing global economy.”
FCC’s report also stresses the need to promote “Buy Canadian,” build infrastructure, and expand processing to add value to exports.
