China Strikes Back: $2.6B in Tariffs on Canadian Goods Amid Trade Tensions

China has imposed tariffs on over $2.6 billion worth of Canadian agricultural and food products, retaliating against Ottawa’s levies on Chinese electric vehicles, steel, and aluminum. The new duties, announced by China’s commerce ministry, will take effect on March 20, mirroring Canada’s tariffs set in October.

The move introduces a fresh trade conflict, influenced by U.S. trade policies. China will apply a 100% tariff on $1 billion worth of Canadian rapeseed oil, oil cakes, and peas, along with a 25% duty on $1.6 billion in aquatic products and pork. However, canola—one of Canada’s key exports—was notably excluded, suggesting Beijing may be leaving room for negotiation.

The decision follows Canada’s claim that Chinese overcapacity distorts global markets. In response, China launched an anti-dumping probe into Canadian canola, a market worth $3.7 billion in 2023. Analysts speculate that China may be leveraging upcoming Canadian elections to push for a reset in trade relations, similar to its past approach with Australia.

China, Canada’s second-largest trading partner, imported $47 billion worth of Canadian goods in 2024. It is also a crucial market for pork exports, particularly for parts that are difficult to sell elsewhere. Industry leaders warn that the steep tariffs will significantly impact Canadian farmers, urging government intervention.

While tensions escalate, experts believe China’s timing signals a broader warning against aligning too closely with U.S. trade policy. With ongoing disputes involving the U.S. and EU, China’s delayed response suggests a strategic approach to global trade battles. Whether negotiations emerge or relations deteriorate further remains uncertain, but the economic impact on Canada is undeniable.