Canada: Trade
Canada is a major participant in international agricultural trade. In 2025, Canada’s global agricultural exports totaled about $67.7 billion, and its global agricultural imports totaled $54.8 billion, according to the Canadian Government’s trade statistics. The United States was Canada's largest agricultural trading partner, buying 60.3 percent of Canada’s agricultural exports and supplying 50.3 percent of Canada’s agricultural imports. In addition, Canada was also the second leading agricultural trade partner of the United States, when exports and imports are combined. In 2025, Canada accounted for 16.7 percent of U.S. agricultural exports and 18.5 percent of agricultural imports.
The heightened level of integration between the U.S. and Canada’s agricultural sectors is partly due to the Canada-U.S. Free Trade Agreement (CUSTA), which was implemented in 1989 and subsumed by the North American Free Trade Agreement (NAFTA) in 1994. From 1989 to 1998, CUSTA and NAFTA dismantled virtually all tariff and quota barriers to Canada-U.S. agricultural trade, with a few notable exceptions, including: U.S. imports of dairy products, peanuts, peanut butter, cotton, sugar, and sugar-containing products—as well as Canadian imports of dairy products, poultry, eggs, and margarine.
In November 2018, the Canadian, Mexican, and U.S. Governments signed the United States-Mexico-Canada Agreement (USMCA) to replace NAFTA. The entry-into-force date for USMCA was July 1, 2020. In general, USMCA continues NAFTA’s provisions for tariff- and quota-free trade for almost all agricultural products traded between the United States and Canada, while offering broader market opportunities for U.S. exports to Canada of dairy, poultry, and egg products.
Canada-U.S. agricultural trade has expanded almost without interruption during the CUSTA-NAFTA-USMCA period. Between 1988, the last year prior to implementing CUSTA, and 2025, U.S. agricultural exports to Canada and U.S. agricultural imports from Canada grew at compound annual rates of 7.4 percent and 7.7 percent, respectively. The major exceptions to this pattern of growth occurred in 2009, following the economic downturn of 2007–09, from 2015–20, and in 2025, due to declines in many commodity prices.
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Much of Canada-U.S. agricultural trade consists of intra-industry trade, meaning that each country exports products to the other within certain sectors. In grains and feeds, intra-industry trade encompasses numerous processed products, including: dog and cat food for retail sale; mixes and doughs; pastries, cake, bread, and pudding; breakfast cereal; and uncooked pastas. Beef and pork are prominent examples of intra-industry trade outside the grains and feeds sector.
Roughly two-thirds (62.6 percent) of U.S. agricultural exports to Canada in 2025 were in animal products, grains and feeds, fruit, vegetables, and oilseeds and oilseed products. Among the leading exports were: fuel ethanol ($1.5 billion); dog or cat food for retail sale ($1.2 billion); chocolate and chocolate preparations ($1.1 billion); beef and beef variety meats ($881 million); live cattle ($848 million); and pork and pork variety meats ($750 million).
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Detailed table on selected U.S. agricultural exports to Canada
In 2025, 59.3 percent of U.S. agricultural imports from Canada consisted of meat and other animal products, grains and feeds, and oilseeds and oilseed products. The leading agricultural import in 2025 was cocoa and preparations ($3.2 billion), followed by: rapeseed oil ($3.0 billion); beef and beef variety meats ($3.0 billion); cattle and calves ($1.8 billion); pastries, cakes and similar sweet baked goods, and puddings, frozen ($1.7 billion); frozen potatoes ($1.7 billion); bread, biscuits, and similar baked products, frozen ($1.3 billion); and pork and pork variety meats ($1.2 billion).
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Detailed table on selected U.S. agricultural imports from Canada
Canada: FDI
Foreign direct investment (FDI), defined by the United Nations as “investment made to acquire a lasting interest in or effective control over an enterprise operating outside of the economy of the investor,” is another type of economic linkage that binds the agricultural, food, and beverage sectors of Canada and the United States. In all sectors of the economy at the end of 2024, Canada was the fifth largest destination for U.S. direct investment abroad (after the European Union, United Kingdom, Luxembourg, and Singapore), with a total U.S. direct investment position of about $459 billion, according to FDI data on a historical cost basis from the U.S. Department of Commerce’s Bureau of Economic Analysis (BEA). In addition, Canada was the fourth largest source (after the European Union, United Kingdom, and Japan) of FDI in the U.S. economy, with a total direct investment position of about $733 billion. BEA defines “direct investment position at historical cost” as a “measure of the value of direct investors’ equity in, and net outstanding loans to, their affiliates in which the direct investors’ investment is valued at book value. It largely reflects prices at the time of the investment rather than prices of the current period and is not ordinarily adjusted to reflect the changes in the current costs or the replacement costs of tangible assets or in stock market valuations of firms.”
Cross-border investment between the United States and Canada in the food industry is also substantial. At the end of 2024, Canada was the second largest destination for U.S. direct investment in the food industry (after the United Kingdom) as well as the fourth largest source of FDI in the U.S. food industry (after the European Union, Switzerland, and the United Kingdom). During the 3-year period of 2022–2024, the U.S. direct investment position in Canada’s food industry averaged $6.2 billion annually, and the Canadian direct investment position in the U.S. food industry averaged $10.2 billion. U.S. direct investment in the Canadian food industry trended downward from 2014 to 2021, largely due to a decline in the U.S. direct investment position in the fruit and vegetable preserving and specialty foods sector. Canada’s direct investment in the U.S. food industry has trended upward since 2010. In general, mergers and acquisitions involving large firms can result in substantial year-to-year changes in specific industries in the U.S. direct investment position in Canada and the Canadian direct investment position in the United States.
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