Trump announces agreement with Canada and says tariffs will be zeroed for farmers

Donald Trump announces tariffs. AFP The United States and Canada announced this Wednesday (19) a trade agreement that suspends the escalation of the tariff war between the two countries. President Donald Trump said the pact provides for zero tariffs on American agricultural products exported to Canada and said there will be "no tariffs" on the entry of these items, while the final details of the agreement are still being formalized. Canadian Prime Minister Mark Carney speaks at the World Economic Forum in Davos, Switzerland, January 20, 2026. REUTERS/Denis Balibouse Below, Reuters has rounded up the main sticking points highlighted by the Office of the United States Trade Representative (USTR) in its 2026 report on Canada. Milk, poultry and eggs The United States criticizes the Canadian system that controls the production of milk, poultry and eggs. In this model, the government establishes production limits and also defines import quotas - that is, a maximum quantity that can enter the country with reduced tariffs. When imports exceed this quota, Canada charges tariffs that can exceed 200%, which, according to Washington, makes it difficult for American producers to access the Canadian market. Brazil sees 'discrimination' in new US tariffs and calls for WTO mediation The US also complains about the way Canada manages the dairy import quotas provided for in the USMCA and milk price policies. Mark Carney's government has already stated that this system will not be negotiated. Preference for Canadian companies Washington states that the Buy Canadian initiative gives priority to Canadian companies and the use of steel, aluminum and wood produced in Canada in large public contracts. The US also challenges rules adopted by provinces such as Ontario, Quebec and British Columbia, which, according to the US government, put US suppliers at a disadvantage in public tenders. Wine, beer and spirits In most of Canada, the distribution of alcoholic beverages is controlled by provincial public bodies. The United States says this model creates barriers through rules about what products can be sold, prices and distribution requirements. The dispute intensified after several provinces stopped selling American alcoholic beverages in response to tariffs imposed by Trump on Canadian products last year. Find out how the grape route boosted the centuries-old wine tradition in MG and SP Devanir Gino/Claudemir Camilo/EPTV The Premier of Ontario, Doug Ford, stated that US drinks will only return to the shelves if tariffs are removed or if a new trade agreement is signed. Taxes on digital services and platforms The United States continues to monitor the Canadian tax on digital services, levied on large technology companies. Although Ottawa has promised to repeal the measure, it has not yet been officially eliminated by the end of 2025, according to the USTR. Washington also criticizes the Online News Act, which obliges large digital platforms to pay Canadian journalistic organizations for the use of their content. Another point of friction is the rules for streaming services, which require certain platforms to contribute financially to Canada's broadcasting system. The Canadian government has signaled that it intends to abandon the proposal to force companies like Netflix to finance local productions to avoid increasing costs for consumers. How recruiters use Discord to gain the trust of children and teenagers Agriculture and seeds The US claims that the Canadian seed registration system is slow and bureaucratic, which makes it difficult for American seeds and grains to enter the country. Washington also maintains objections to restrictions on imports of some fresh fruits and vegetables. Intellectual property Canada remains on the United States' watch list for intellectual property protection. Concerns include the sale of counterfeit and pirated products, especially at Pacific Mall in Toronto, as well as issues related to patent protection and the recognition of geographical indications, which identify products linked to a specific region. Forced labor Although Canada has adopted measures to prevent the import of products made with forced labor, the United States claims that supervision is still insufficient and could allow these items to enter the Canadian market. Earlier this month, the country introduced a new law to reinforce the ban on these imports. Trump administration announces new 50% tariff for Canada Forced Labor/ Modern Slavery/ Work Analogous to Slavery International Labor Organization/ Kazi Salahuddin Razu/ Getty Images Energy market in Alberta Washington says that the electricity market in the province of Alberta continues to harm American producers. According to the US, companies in the sector complain that energy generated in the neighboring state of Montana receives lower priority than electricity produced in Alberta, even when both have the same price, limiting the access of American suppliers to the provincial market. Drug prices The United States says the Canadian body responsible for reviewing the prices of patented medicines unfairly reduces the value of innovative medicines. The criticism is that Canada no longer uses the United States and Switzerland as a reference in the international comparison of prices for patented medicines, which, according to the American pharmaceutical industry, artificially reduces prices charged on the Canadian market.