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NAFTA, Canada, and Mexico: Canada Trade

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Canada is a major participant in international agricultural trade. In 2008, Canada's total agricultural exports (to all countries) exceeded $40.0 billion, and corresponding imports surpassed $27.2 billion, according to Canadian statistics. The United States is Canada's largest agricultural trading partner, buying 53 percent of Canadian exports and supplying 59 percent of Canadian imports. In addition, Canada is the leading agricultural trade partner of the United States. In 2008, Canada accounted for 14 percent of U.S. agricultural exports and 22 percent of imports, as defined and categorized by USDA.

The heightened level of integration between the U.S. and Canadian agricultural sectors is due in part to the Canada-U.S. Free Trade Agreement (CUSTA), which was implemented in 1989 and subsumed by the North American Free Trade Agreement (NAFTA) in 1994. From 1989 to 1998, CUSTA and NAFTA dismantled virtually all tariff and quota barriers to Canada-U.S. agricultural trade, with a few notable exceptions: U.S. imports of dairy products, peanuts, peanut butter, cotton, sugar, and sugar-containing products and Canadian imports of dairy products, poultry, eggs, and margarine. During the CUSTA-NAFTA period, Canada-U.S. agricultural trade has expanded almost without interruption. Between 1988 (the last year prior to CUSTA's implementation) and 2008, U.S. agricultural exports to Canada expanded at a compound annual rate of 8.2 percent, while agricultural imports from Canada grew at a rate of 10.5 percent.

U.S. -Canada agricultural trade has expanded almost without interruption during the CUSTA-NAFTA period (1989-present) d
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Much of Canada-U.S. agricultural trade consists of intra-industry trade, meaning that within certain sectors, each country exports products to the other. In grains and feeds, intra-industry trade encompasses numerous processed products, including dog and cat food for retail sale; mixes and doughs; pastries, cake, bread, and pudding; breakfast cereal; and uncooked pastas. Beef and pork are prominent examples of intra-industry trade outside the grains and feeds sector.

Grains, fruit, vegetables, meat, and related products accounted for about 60 percent of U.S. agricultural exports to Canada in 2008. Among the leading exports were beef ($697 million), pork ($539 million), corn ($505 million), dog or cat food for retail sale ($495 million), and soybean meal ($467 million).

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Roughly 65 percent of U.S. agricultural imports from Canada in 2008 consisted of meat, grains, vegetables, fruit, and related products. Three of the five leading imports in 2008 were in the broad category of animals and animal products: live cattle and calves ($1.5 billion), beef and veal ($893 million), and pork ($724 million). The other leading imports were rapeseed oil ($1.4 billion) and wheat ($1.0 billion).

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Selected U.S. agricultural exports to CanadaExcel file

Selected U.S. agricultural imports from CanadaExcel file

To view more detailed U.S.-Canada agricultural trade statistics, go to USDA Foreign Agricultural Service's U.S. Trade Internet System.

 

For more information, contact: Steven Zahniser

Web administration: webadmin@ers.usda.gov

Updated date: September 14, 2009