Prairie equipment manufacturers adjust to tariffs

Glacier FarmMedia—In 2023, Saskatchewan exported about $834 million worth of agricultural equipment to the United States.

A portion of those exports were straw choppers and weed seed control units, manufactured by Redekop at its plant near Saskatoon.

Redekop has farmer customers in Montana, North Dakota, Kansas and other states who want a better chopper on their combine. The Redekop straw chopper cuts straw into fine pieces and evenly distributes the residue across the field, which is desirable for growers.

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“We tend to focus on small grains and the higher volume of residue, where you have lots of straw,” Trevor Thiessen, chief executive officer of Redekop Manufacturing, said while sitting at a booth at the Commodity Classic, a trade show held in Denver March 2-4.

U.S. sales growth

Redekop sales to the U.S. have increased in the last five years as word spread about the straw choppers and Redekop’s weed seed destructor.

However, sales were soft in 2024 due to the downturn in the ag equipment market.

“Farmers were hesitant to spend a lot of money … 2024 was a hard year for a lot of equipment guys,” Thiessen said.

Last year was challenging, but 2025 could be more difficult for Redekop and other Canadian manufacturers.

U.S. president Donald Trump imposed 25 per cent tariffs on all goods from Canada March 4, although the tariff rate and implementation date may have changed by the Western Producer’s March 10 press time.

A spokesperson for another manufacturer of ag equipment on the Prairies, who also attended the Commodity Classic, said his company acted before March 4 to avoid the tariffs. The Manitoba business moved machinery across the border this winter and should have sufficient stock in the U.S. for many months of sales.

Shipping ahead of tariffs

Redekop took similar action in February.

“We shipped pretty much 98 per cent of our (U.S.) distributor’s order already,” Thiessen said.

Exporting farm equipment to the U.S. has become a larger part of Saskatchewan’s economy.

Sales climbed by $500 million from 2019-23, reaching $834 million in 2023.

“There certainly is growth in the agricultural machinery and equipment exports from Saskatchewan specifically to the U.S.,” said Peter Siarkos, director of manufacturing and technology with the Saskatchewan Trade and Export Partnership, which helps provincial businesses sell their products to the world.

Exports of ag equipment have created strong relationships between Saskatchewan firms and American buyers, but explaining the impact of tariffs and who will cover the cost can get awkward.

“When I talk to U.S. farmers and customers, I’m not sure everyone fully understands that the importer, i.e. the U.S. farmer, is the one who is going to have to pay the premium,” Thiessen said.

Who absorbs the tariffs?

To maintain American sales, Redekop and other Canadian makers of ag equipment may absorb a portion of the 25 per cent tariff. The customer will take on the rest.

“I think we’ll be fine.… Maybe we take a margin hit (on U.S. sales) for a period of time, but it’s not going to cripple our business.”

As of March 2025, it’s impossible to predict Canada’s trade relationship with the U.S for the next four years. It could be OK, bad or horrific.

If tariffs do stick around for years, Thiessen is considering a branch plant or a partnership to do some manufacturing in the U.S.

“We’ll make these core components, you assemble,” he said, describing one scenario.

“Set up a (U.S.) assembly plant, which would (maybe) get us past the tariff.”

Such decisions are a few years down the road, depending on what happens with trade and tariffs.

In the shorter term, Redekop Manufacturing wants to diversify sales to other parts the world. It has set up a company in South America to sell straw choppers and weed seed destructors to farmers in Argentina and Brazil, Thiessen said.

“(We’re in the) second year of testing in Brazil and the first full season of selling in Argentina.”