New Tariffs on Canada Raise Concerns for Corn Farmers

New U.S. tariffs on Canadian goods took effect August 22, with a 50% tariff applying to $27.6 billion of specified Canadian imports. This is not a blanket 50% tariff on all Canadian goods, as exemptions and other tariff structures remain in place. Most relevant to Illinois farmers, U.S. exports of corn, ethanol and distillers grains to Canada are exempted, as are Canadian fertilizer imports to the U.S.

Canada is set to retaliate beginning September 8, imposing 15%, 25% and 50% tariffs on $27.6 billion of U.S. imports. The tariffs will affect sectors including agricultural equipment, steel, dairy, appliances, pulp and paper, and electronics.

Canada is a critical market for U.S. agriculture. In 2025, the United States exported $28 billion in agricultural products to Canada, including $1.7 billion in ethanol and $325 million in corn. Canada is also the No. 1 export market for U.S. ethanol.

For Illinois corn farmers, the larger concern is what these tariffs could mean for demand. With corn prices and farm margins already under pressure, maintaining strong and reliable markets is critical.

Canada and Mexico are both essential trading partners for U.S. agriculture. Maintaining a predictable trade relationship, including the commitments of USMCA, remains important for farmers, the ag industry, and the ag economy.

Hear more about corn and ethanol export market updates

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