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On December 15, 2024, the United Kingdom officially became a member of the CPTPP, signalling a major step forward in the expansion of this agreement. However, we expect the impact on the Canadian poultry and chicken sector will be relatively minor. While the United Kingdom is a key player in world trade, most of its chicken exports are directed towards the nearby European market. Furthermore, unless Canada ratifies the accession agreement, the two countries will not be able to access each other’s markets under the terms of the CPTPP, which could take some time, as the Canadian Parliament has yet to ratify the implementation agreement. In terms of chicken exports, Chile is expected to continue as the primary exporter to Canada under the CPTPP, as existing trade ties are already in place.
Trade relations between Canada and the United States remain a top priority, particularly as the newly inaugurated Trump administration takes office on January 20, 2025. Despite Donald Trump’s intentions to implement a 25% tariff on Canadian and Mexican goods upon taking office, concerns for the poultry sector remain relatively low. A significant proportion of poultry exports to the United States are made under the Canada Border Services Agency’s Duties Relief Program (DRP) or Global Affairs Canada’s Import for Re-export program (IREP). While this supplementary activity is important for some Canadian processors, it does not represent a significant volume for the sector as a whole. Other Canadian exports to the United States are predominantly niche products. These volumes remain relatively limited, and although an increase in American tariffs could have an impact on these segments, it is not expected to significantly disrupt the flow of trade.
However, there is another risk factor in the event of countermeasures by Canada in response to the new American tariffs. If Canada were to impose retaliatory tariffs on certain imports from the United States, such as chicks or hatching eggs, this could affect the supply chain of the sector. Furthermore, if a number of Canadian suppliers are no longer able to export to the United States, this could result in increased competition in the domestic market. However, in the absence of concrete measures in the short term, the overall impact of American tariffs on the Canadian poultry sector seems relatively limited, except for a few specialized processors.
Costa Rica’s membership in the CPTPP is a recent development, and negotiations officially began on November 28, 2024. While this represents a step forward in the expansion of the CPTPP, the impact on the Canadian poultry sector remains limited. As Costa Rica is not a major poultry producer at the continental or even CPTPP level, this membership is unlikely to significantly affect existing market dynamics. However, this development shows that the agreement is continuing to grow, which is why it remains important to follow the discussions to see if adjustments are needed in market access modalities, or even at the level of sanitary and phytosanitary (SPS) measures.
On November 15, 2024, Canadian Prime Minister Justin Trudeau and Indonesian President Prabowo Subianto announced a major step forward in the Canada-Indonesia Comprehensive Economic Partnership (CEPA) negotiations, with the substantive conclusion of negotiations. While discussions on market access for goods, services, investment and financial services are still ongoing, this partnership to date is of little consequence to the Canadian poultry sector. However, as Indonesia is a member of the Association of Southeast Asian Nations (ASEAN) (including Indonesia, Malaysia, Philippines, Singapore, Thailand, Brunei, Vietnam, Laos, Cambodia and Myanmar/Burma), it will be important to follow the developments of this agreement. As the ASEAN group includes countries such as Thailand, this may present a challenge for the Canadian chicken sector in the event of an eventual free trade agreement. It is worth noting that Canada-ASEAN negotiations remain at a standstill due to the difficulty of reaching a consensus between its members on SPS issues in particular.
