Canadian beef producers are telling Ottawa a potential trade deal with a South American trading bloc could weaken the domestic industry as it attempts to rebuild dwindling cattle herds. 

Beyond any potential effect on prices, the Canadian Cattle Association said a deal that includes Brazil — the world’s largest beef producer — could also ignite new trade tension with the United States.

“Not all jurisdictions represent the same opportunity and present different risks that I think really need scrutiny,” CCA president Tyler Fulton told CBC News, adding his members support wider trade, but depend on the highly integrated North American market.

Now is not the time to experiment in areas where he sees little to gain, he said. 

“There’s concern about the impact that it would have on the domestic market at a time when we’re at the tightest supply that we’ve been in 40 years,” Fulton said.

“There’s also the question of how our U.S. partners would view any new access.”

U.S. President Donald Trump has already accused Canada of opening a “back door” for third-party imports to enter the U.S. market, and could take a similar stance on new agreements involving beef, said Fulton.

He sees little opportunity to export Canadian beef south to Brazil, a low cost producer and the world’s largest beef exporter, according to the U.S. Department of Agriculture.

A Canadian independent beef market analyst, however, says the amount of beef that could come north would have little effect on the domestic cattle industry or grocery store prices. 

“On paper, it could relieve some of the pressure, but it’s not material at all,” said Kevin Grier, an Ontario-based consultant who advises participants in the Canadian livestock sector.

He said ranchers and feedlot operators are doing “extremely well” as prices continue to reach records, and that’s not likely to change soon. Nor are grocery store prices. 

“When it comes to Victoria Day weekend, and what you’re going to put on the grill, it’s really not going to impact the price at all,” he said. “I don’t see the issue here.”

Beef prices outpaced most other food items in terms of inflation last year, rising 16 per cent in 2025, and are expected to continue rising as North American cattle inventory remains low.

Ottawa seeks broader trade

The federal government has vowed to expand international trade agreements to address inflation and make the country less reliant on the now-uncertain trade relationship with the U.S.

That included re-engaging in talks last summer with the South American free-trade bloc known as Mercusor on gaining access in a wide range of sectors, including agriculture.

Global Affairs Canada told CBC News that the objective of “intensified” talks is to expand trade and supply chains to “diverse and reliable markets… ideally before the end of 2026.”

“As negotiations advance, the government will continue to work closely with all interested stakeholders,” read a statement.

“We recognize the important role that Canada plays in the production of high-quality beef, and the government of Canada will continue to consult with this sector.”

The European Union and Mercosur, which includes Brazil, Argentina, Paraguay, Uruguay, and others like Chile as associate members, formalized an agreement in January.

Beef exports, imports tied to U.S. market: analyst

Grier sees the potential volume of Brazilian beef coming north as limited, and says Canadian packers are not likely to increase shipments to Brazil, no matter the level of tariffs.

“Right now, 80 per cent of our exports go to the United States, which is the highest-priced market in the world,” he said, noting Japan and South Korea as other lucrative markets.

Grier says Brazil accounted for about one per cent of beef used in Canada last year, mainly in making processed foods, like soup.

Imports from all countries accounted for about one-fifth of the beef sold to Canadian consumers in 2025, coming mainly from the United States, but also Australia, New Zealand, Mexico and Uruguay.  

Aside from U.S. steaks, roasts and ground beef, most imports are not for the “table” but rather for manufacturing, Grier said, though some grocers have resorted to Mexican cuts as supply has tightened.

Statistics Canada stated last month that cattle inventories in Canada rose 2.5 per cent to 11.1 million animals during 2025.