A potential threat looms over Canadian businesses as a new set of U.S. tariffs could impact them if a trade deal between Canada and the U.S. is not reached. Under Section 338 of the Smoot-Hawley Tariff Act, up to $20 billion in imported Canadian goods, ranging from electronics to furniture to orchids, could be affected.
Photographer Evan Mitsui from CBC recently visited an orchid greenhouse and a furniture maker in Ontario to discuss their apprehensions. Guann Chen, a third-generation orchid farmer with a large greenhouse complex in St. Catharines, Ont., located in the heart of Niagara’s greenhouse belt, expressed concerns. His Orchid Greens products are distributed in major grocery chains like Loblaws, T&T, and Metro, as well as numerous nurseries and flower shops across Ontario, with nearly half of his production destined for the U.S. market.
Chen emphasized the significance of proximity to the U.S. border and market for perishable goods like orchids, enabling the Niagara region and the town of Leamington to leverage years of greenhouse expertise into an export industry valued at hundreds of millions of dollars. Despite larger orchid operations in California, Chen highlighted the impracticality of quickly shifting suppliers due to the time-intensive nature of orchid cultivation.
In another sector, Lind Furniture, a Woodbridge-based company with a history of almost 60 years in upholstered furniture manufacturing, faces challenges. While Lind white-labels for Costco and engages in a significant partnership with the retailer, approximately 40% of its business involves cross-border trade with small to mid-sized U.S. retailers.
The general manager, Michael Saifer, shared concerns about the detrimental impact of the new tariffs, stressing the existing uncertainty that has already affected the business. Uncertainties have led to halted orders, as even medium-sized retailers cannot risk significant investments in orders that may encounter border delays and additional taxes. Consequently, the company has had to implement staff furloughs and reduce shifts.
Saifer also mentioned the rising costs of essential components like steel fasteners and hardwoods, crucial to the business’s quality standards. These increased costs have further strained the company’s operations, highlighting the broader challenges faced by Canadian businesses amid the evolving trade landscape.