Trade tensions highlight need to diversify, strengthen Canada’s food export markets says RBC

Glacier FarmMedia—Canada’s agriculture industry could drive forward a new era of trade diversification, but the time to forge that path forward is now according to a new report.

In Food First: How Agriculture Can Lead a New Era for Canadian Exports, RBC outlines a plan to expand Canada’s global market share by 30 per cent and create $44 billion in new agri-food exports by 2035.

Canada has seen many benefits of the U.S.’s priority access to production and processing, the report said. But the industry has become overly reliant on Canada’s southern neighbours as an export market, which is concerning given the ongoing threat of tariffs from Canada’s largest trade partner.

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Canada accounts for 20 per cent of U.S. agri-food imports, but if large-scale tariffs are applied to agriculture and agri-food products, it would make Canada a less desirable trade partner to the U.S.

“With rising trade uncertainty and escalating tariffs in North America, Canada must accelerate efforts to diversify its trading partners, particularly in Southeast Asia, Africa, and the Middle East,” said report author Lisa Ashton, RBC Thought Leadership’s agriculture policy lead.

At the same time, Canada’s global competitiveness has also slipped, dropping its seventh place from fifth on the global export leaderboards. Much of this competition has come from Brazil and Chile, which have both taken large chunks of the market in meat and fish, where Canada has been competitive globally in the past.

“Canada’s market share since 2000 has declined, relatively, by 12%,” the report said. “Our exports are still growing—they’ve quadrupled during that time. It’s just that we’re not keeping pace with the rest of the world, which saw agriculture and agri-food exports grow five-fold over the same period.”

The report recommends three objectives by which Canada can grow its exports: taking advantage of what we have, taking on growth markets and strengthen current partnerships.

Canada has 18 free trade agreements in place, which provide access to more than two-thirds of the global economy. The report shows that if Canada can use those agreements to make better use of market access to Europe, Asia and Latin America, it could grow its share of the global export pie.

Taking on new growth markets requires exploring more global trade partners — particularly in south and Southeast Asia. One of the clearest growth opportunities – especially in plant-based proteins like peas, lentils and soybeans – will be India, the report said. That market of 1.5 billion people is seeing a rapid growth in economy and standard of living.

Strengthening and growing current partnerships relies on Canada taking advantage of food trade deficits projected for countries like Japan, China and the U.S. in the next decade.

“Driving production and processing in these domains will help position Canada as a strategic as well as a reliable partner, if we can make some of the investments we’ll outline in the following sections,” the report read.

The findings of the report included five keys to unlocking Canada’s export potential:

• Innovation: Accelerate the adoption of precision farming and food processing technologies to increase productivity and efficiency.
• Capital: Scale up agri-food processing clusters to add value to raw commodities and expand Canada’s footprint in global markets.
• Digital access: Close the 5G and high-speed internet gap in rural Canada to unlock the full potential of digital agriculture.
• Export Infrastructure: Modernize ports, logistics, and transportation networks to reduce bottlenecks and improve export reliability.
• Global marketing: Strengthen market development efforts and regulatory alignment in high-growth regions like Southeast Asia, Africa, and Latin America.

The growth necessary to see Canada return to the world’s fifth-largest agriculture and agri-food exporter would require a 50 per cent expansion in value-added agri-food exports and a ten per cent increase in agriculture commodity exports.

“Canada has long been one of the world’s leading food producers,” said John Stackhouse, senior vice president of RBC’s office of the CEO.

“We have an opportunity to turn agriculture into a driving force for trade diversification and if we act now, we can ensure Canadian farmers, processors, and exporters are well-positioned to lead the global food economy rather than losing ground to competitors.”