Canada’s beef producers say Mercosur trade deal will devastate industry

Cattle graze at a ranch near Asuncion, Paraguay, on March 11, 2026. Photo by Santi Carneri/Bloomberg

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Canadian beef producers fear Ottawa’s plan for a free-trade deal with South America’s Mercosur bloc will lead to a flood of cheaper imported meat that risks devastating their multibillion-dollar industry.

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Canadian Cattle Association president Tyler Fulton said a Mercosur deal has “pretty dubious benefits” for the country, as Prime Minister Mark Carney seeks to double non-U.S. exports to reduce its over-reliance on the American economy.

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“It just doesn’t represent a reciprocal market opportunity,” he said. “There’s significant benefit in accessing the Canadian beef market, but there’s really very limited opportunity for Canadians.”

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The CCA, which represents 60,000 cattle farmers and feedlots, reports that imports into Canada from Mercosur countries increased 238 per cent from 2021 to 2025, adding their annual quotas were filled in days this year.

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Mercosur comprises Argentina, Brazil, Paraguay and Uruguay, with Bolivia in transition to full membership. Its exports are dominated by commodities such as oil, minerals and agricultural produce.

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Welber Barral, a consultant at BMJ Associados and former Brazilian trade official, said Canadian opposition was part of the negotiating process.

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“In Europe, it ended up leading to a quota. Brazil and Mercosur will try to make it free trade. It’s part of the game,” he said.

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Fulton dismissed claims of protectionism, as Canada is “very exposed to imports,” adding: “Canada last year imported 30 per cent of its beef while the U.S. is 19 per cent and the EU is seven per cent.”

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Brazil is the world’s largest beef exporter, with 3.5 million tonnes of shipments last year worth US$18 billion. Its exports in the first quarter of 2026 increased by 18 per cent in volume and more than a third in revenue, according to an industry body.

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The South American nation’s largest customer for beef, China, recently tightened access to its market. Industry experts predicted this could lead to product being diverted to other destinations. Fellow Mercosur member Argentina is another top producer.

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Fulton said the Mercosur deal risks undermining farmers’ growing national cattle herd numbers after prolonged drought while “China’s quotas add a surge in imports.”

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In 2025, Canadian beef exports reached $5.3 billion, up 7.7 per cent from 2024, despite slightly lower volumes. Canada sends 75 per cent of its beef exports to the U.S.

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Carney has travelled across the world seeking trade deals in a bid to “catalyze $1 trillion in total investment in Canada over the next five years.”

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Canada started Mercosur talks in 2018 but reinvigorated the process as a response to U.S. trade turbulence. It hopes to sign an agreement before the end of 2026, the FT reported in December.