February 4, 2025
Navigating a U.S.-Canada trade war: What landscape horticultural trades need to know
This is a rapidly evolving situation. Landscape Ontario will continue to provide updates on this page to help members stay informed and prepared.The potential U.S.-Canada trade war has created uncertainty for the landscape horticultural industry in Canada. U.S. Tariffs could significantly impact the sector, with businesses facing higher costs and supply chain disruptions.
Latest update (As of Feb. 3, 2025)
Tariffs delayed for 30 days
Following discussions between Prime Minister Justin Trudeau and U.S. President Donald Trump on February 4, the planned tariffs have been delayed for 30 days while both governments negotiate a potential economic agreement.What was originally planned?
- The U.S. planned to impose 25% tariffs on Canadian imports, except for energy, which would have faced a 10% tariff.
- Canada announced counter-tariffs on $30 billion in American goods, with plans to escalate to $155 billion later this month.
Why were the tariffs delayed?
Canada agreed to increase cooperation with the U.S. on organized crime and fentanyl trafficking.What this means for landscape businesses
- The delay provides temporary relief, but tariffs could still take effect after 30 days if an agreement isn’t reached.
- Businesses should continue preparing for possible cost increases and supply chain disruptions.
Industry-specific impacts
Higher equipment and supply costs
- Many landscaping tools, machinery, and supplies are imported from the U.S.
- Tariffs could increase prices, squeezing profit margins and potentially raising service costs.
Plant material availability and pricing
- If tariffs apply to plant imports from the U.S., availability may become limited, and prices will likely rise.
The importance of U.S. exports for Canadian growers
- Canada exports a diverse range of live plants with soil to the U.S., including turf sod, potted plants, and bedding plants.
- Most other countries cannot sell plants with soil to the U.S. due to phytosanitary restrictions, making Canada’s exports uniquely valuable.
- The U.S. accounts for 99.6% of Canadian plant exports and 45.3% of plant imports, by value.
- The total value of Canadian ornamental exports (including Christmas trees) increased by 13.1% from 2022 to $1.073 billion in 2023.
- The 2023 total value of ornamental exports was 39.4% higher than the average of the previous four years.
Economic slowdown and reduced demand
- A trade war could slow the economy, leading to:
- Less consumer spending on landscaping services
- Construction delays affecting landscape installation projects
Challenges for Canadian exporters
- Some members exporting plants to the U.S. could face a 25% tariff, affecting pricing and sales.
- Even with exchange rate advantages, long-term losses may not be sustainable.
What Landscape Ontario is doing to help
Landscape Ontario is actively working to protect and support members affected by these trade developments.1. Government relations and advocacy
- Monitoring tariff policies by working with OMAFRA (Ontario Ministry of Agriculture, Food and Rural Affairs) and AAFC (Agriculture and Agri-Food Canada).
- Advocating for the federal government to reinvest tariff revenues into support programs for affected small businesses.
2. Business support and strategic planning
- Advising members to secure essential plant materials and supplies in advance to mitigate potential shortages.
- Providing regular updates and industry guidance to help businesses adapt.
What members can do now
Mitigate supply chain risk
- Evaluate alternative suppliers to reduce reliance on U.S. imports. Building multiple supply sources strengthens our negotiating power.
- Source materials domestically or from international partners where possible.
- Stock up on key materials: If tariffs are implemented, prices may increase quickly.
- Stay informed: Trade conditions can change rapidly—be prepared for possible shifts.
Consider pricing strategies
- Re-evaluate pricing structures to protect profit margins.
- Add value to products and services rather than just increasing prices should the need arise.
- Offer bundled services or premium options to offset increased costs should that occur.
Strengthen local partnerships
- Collaborate with local businesses and suppliers to create a stronger industry network.
- Share resources, best practices, and strategies within the community.
- Strengthen B2B relationships to sustain the industry.
Stay informed and engaged
- Monitor tariff updates and trade policies closely.
- Engage with industry associations, government groups and local chambers of commerce.
- Stay involved in advocacy efforts to ensure our concerns are represented.
Focus on customer communication
- Be transparent about potential price or product availability changes should the tariffs be put into place.
- Strengthen client relationships by educating customers on the industry challenges.
- Proactively offer solutions, such as early booking discounts or alternative service options.
FAQ: Key questions for members
Q: When will the tariffs take effect?
A: The tariffs were originally scheduled for February 4 but have been delayed for 30 days following negotiations between Canada and the U.S. The final decision will depend on whether an agreement is reached.
Q: How will a U.S.-Canada trade war affect my business?
A: You may experience higher costs for equipment, plants, and materials, potential slowdowns in consumer demand and export challenges if tariffs resume.
Q: What should I do to prepare?
A:
- Secure supplies early to minimize risks.
- Diversify suppliers to reduce reliance on U.S. imports.
- Follow Landscape Ontario updates for new information.