The Liberal government is promising new supports for canola farmers and other sectors hit by U.S. and international tariffs in the federal budget released Tuesday, along with new spending to boost market access for agriculture and food products and modernize the industry.
Canola farmers are struggling under crippling Chinese tariffs on their products, which are believed to be in retaliation for Canadian tariffs on Chinese electric vehicles.
India has added further strain with a new import duty on yellow peas.
Prime Minister Mark Carney’s meeting with Chinese President Xi Jinping last week in Asia did not result in the Chinese tariffs on canola, as well as on Canadian seafood products, being removed.
The budget proposes $75 million over five years, starting next year, to Agriculture and Agri-Food Canada’s AgriMarketing Program “to enhance the diversification and promotion of Canada’s agriculture, agri-food, fish, and seafood products into new markets,” the document says.
Another $32.8 million over four years, starting in 2026, and $9.6 million ongoing will help the Canadian Food Inspection Agency (CFIA) “secure, expand, and restore market access for Canadian agriculture and agri-food, fish, and seafood sectors.”
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“This includes engaging directly with other countries to strike new trade agreements and expand existing ones, identify and address trade barriers, enhance regulatory cooperation, and advocate for greater market access,” the budget says.
Tariff-affected sectors — including canola, lumber, steel, aluminum and autos — will get access to the previously announced Strategic Response Fund to realign producers to new markets, the budget says, while impacted workers will be supported by “a major reskilling effort.”
Finance Minister François-Philippe Champagne mentioned canola farmers specifically in his budget speech in the House of Commons while promising relief and support for tariff-affected sectors.
“To our lumber and canola producers, we know times are hard, and we are working not only to restore your market access, but to expand it,” he said.
The budget allocates $97.5 million over two years to temporarily increase the Advance Payments Program’s interest-free limit to $500,000 for canola advances for 2025 and 2026.
This is on top of the temporary increase to $250,000 of the interest-free limit for all producers for the 2025 program year, the budget says, creating interest savings and increased cash flow for producers until they sell their products.
An additional $109.2 million will be earmarked in the current fiscal year for Agriculture and Agri-Food Canada’s federal-provincial-territorial cost-shared AgriStability program, which will increase the compensation rate for agricultural producers to 90 per cent and raise the per-farm payment cap to $6 million.
“This is available to help agricultural producers cope with large declines in farming income due to increased costs, adverse market conditions, and other challenges,” the budget says.
The budget also sets aside $76 million over five years, starting next year, to the CFIA to support modernized “digital trade tools and services and integrate artificial intelligence into internal processes.”
“This includes moving away from paper-based systems and expanding the use of digitalized import and export certificates to simplify processes, reduce the risk of errors, fraud, and delays, and enhance traceability,” the budget says.
The measures will also include standardized export certificates to help adhere to other countries’ requirements and reduce product safety burdens.
“These investments will support faster, simpler, and more reliable services from the CFIA—crucial for Canadian exporters,” the budget says.
In a statement, Grain Growers of Canada applauded some of the budget measures and others like permanently reversing the capital gains tax increase, but cautioned others “could undermine farm competitiveness.”
“While Budget 2025 provides much-needed clarity for farmers, it falls short of delivering the full competitiveness framework needed,” executive director Kyle Larkin said. “We look forward to continuing to work with the government to ensure the sector remains competitive, resilient, and profitable to drive Canada’s export economy.”
Conservative Leader Pierre Poilievre criticized the Liberals for keeping the industrial carbon price that he said will raise costs for farming equipment and fertilizer, “and therefore on food.”
“We will put forward an amendment that will transform this policy by making Canada affordable again,” he said in the House of Commons. “It will get rid of the industrial carbon tax, cut the wasteful spending to bring down debt, inflation and taxes.”
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