Saskatchewan manufacturers re-evaluating imports as counter-tariffs kick in
Manufacturers in Saskatchewan say they are watching their bottom lines and evaluating their options as Canada's counter-tariffs kick in.
Saskatchewan-based mining equipment manufacturer Bit Service Company is re-evaluating its imports as the country's counter-tariffs begin to take effect. The company's CEO, Scott Bahr, has been purchasing more American steel to ensure a sufficient stockpile to withstand the impact of the tariffs, which were triggered in response to U.S. President Donald Trump's trade war escalations.
These tariffs equal $27.6 billion in imports from the U.S. across various sectors, including steel, dairy, and electronics. Bahr notes that his company is more affected by the reciprocal Canadian tariffs rather than the initial U.S. tariffs, as the company imports more raw steel components than it exports to the U.S. The short-term effect of the tariffs is felt through reduced margins, but the long-term implications include a potential decline in competitiveness with clients.
Many Saskatchewan manufacturers find it challenging to switch to Canadian or alternative sources for raw materials due to the reputation of American products and the time-consuming nature of supply chain changes. Keith Moen, executive director of the NSBA, acknowledges the potential benefits of sourcing locally but also highlights the challenges.
Small- and medium-sized enterprises in Saskatoon are expected to bear the brunt of the counter-tariffs, facing uncertainties in inventory, staffing, cost, and expense control. The federal government has offered up to $3 million in non-repayable support through its Regional Tariff Response Initiative (RTRI) by PrairiesCan to help Prairie small- and medium-sized businesses impacted by tariffs.
Allan Wiens, CEO of farm equipment supplier SeedMaster, has received over $596,000 in federal government RTRI funding to expand into Australia. Wiens mentions that the counter-tariffs have affected his company's supply chain, with about 30% of materials sourced from the U.S. The uncertainty in trade talks is the most significant impact so far this year.
Despite the challenges, manufacturers remain optimistic and draw on past experiences to navigate the current situation.
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