Canada: An Important Market for U.S. Pork
Canada has historically been one of the top destinations for U.S. pork. In 2021, Canada was the fourth largest export market for U.S. pork with exports of 486 million pounds worth $952.3 million.
Canada continues to be the top destination for U.S. agricultural exports as it represented 16% of total U.S. agricultural exports in 2020. In addition, the U.S. was Canada’s largest trading partner for agricultural goods, capturing 58% of Canada’s import market.
Strong Import-Export Ties Between U.S. & Canada
U.S. Exports to Canada
In renegotiation of the North American Free Trade Agreement (NAFTA), on July 1, 2020 the new U.S.-Mexico-Canada Agreement (USMCA) entered into force. USMCA preserves zero-tariff trade for U.S. pork in North America and further strengthens agricultural trade between the U.S. and Canada.
Canada is the second largest market for U.S. high-value, consumer-oriented products. In 2020, U.S. agricultural exports to Canada totaled $21 billion, a 1% increase from 2019. With 57% market share, U.S. exports remain highly valued in the Canadian market.
Canadian Protein Consumption
Due to COVID-19 and economic uncertainty, Canadian consumers purchased more pork in 2020 as a cheaper alternative to other protein sources, such as beef.
USDA Foreign Agricultural Service estimated that total domestic consumption decreased 9% in 2020. 2021 consumption is expected to be down less than 1%. However, the momentum is expected to rebound and continue upward in 2022, up 3.4% from year-end 2021.
In 2021, Canada’s pork exports were down 2% as growth to other markets nearly offset the slowdown to China. The top growth markets in 2021 are the Philippines, Mexico and the U.S.
Pork Merchandising Opportunities
USDA-FAS data shows Canada’s 2021 imports are down 5% in 2021, following 5% growth in 2020. FAS forecasts 2022 imports up 4%. The U.S. will remain the main source of imports.
With USMCA in full swing, the U.S. maintains the market access benefits of NAFTA for the red meat industry (including duty-free access for pork to Canada), while achieving additional trade-facilitating mechanisms such as the enhanced sanitary and phytosanitary (SPS) chapter.