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The trade war with Canada is a gut punch to Wisconsin, given that our neighbor to the

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north is the state's largest international trading partner.

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Wisconsin exports about $7.5 billion worth of goods to Canada and imports about $5.7

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billion worth.

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We export things like machinery, agricultural products, including dairy, and forest products

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like paper.

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Our imports include wood pulp, oil, natural gas, and aluminum.

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Trade talks between the countries broke down when the U.S. imposed an additional 50% in

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tariffs on a range of Canadian goods, and that country in turn said it would impose

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matching tariffs starting just after Labor Day.

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For how this stacks up and what it means, we turn to CEO of the Wisconsin Economic Development

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Corporation, John Miller.

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And thanks very much for being here.

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Great, Erica.

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Thanks so much for having me.

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So where does this trade war with our largest export partner leave Wisconsin?

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Well, as you mentioned in your comments, Canada is Wisconsin's largest trading partner.

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So any unexpected changes to the current trade policy will lead to lots of uncertainty

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and frustration with Wisconsin businesses.

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And that'll obviously have a negative impact, not only on consumers who have to pay more

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for goods, but also businesses and other industries like agriculture that you mentioned

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that export their products and key and are the most key employers in our state.

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So according to the U.S. Census Bureau, exports from Wisconsin companies were down $687 million

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last year, and the disruptions contemplated in the discussions of the last week or so

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will cause that to increase.

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So and I should point out that that number, $687 million, is the lowest point we've had

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since COVID, and it's the second consecutive year of decline.

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So we're not trending in the right direction.

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And that obviously directly impacts the bottom line of our businesses and makes it harder

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to retain employees.

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How surprising was it for you to see Canada play hardball and impose these matching tariffs?

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Well, obviously on a state level, you know, we don't get to decide tariff policy nor do

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we get to influence our partners across the country.

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But it is concerning because businesses are – the businesses that I meet on a weekly

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basis are reporting to me that they are very, very concerned about the unpredictability

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of the changing landscape of tariff policy.

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And the way they say it is, just like it would be unfair and catech to change the rules in

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the middle of a sporting event, businesses depend on a level playing field.

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And also the certainty that the rules that they face today will be the same rules that

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they face tomorrow.

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So – and I come from the manufacturing sector, so I know how difficult it is to make plans

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at the best of times when things are going well and policy is consistent.

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But this constant rollercoaster of tariff policy makes it almost impossible for businesses

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to plan and effectively run their businesses.

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They need to focus on staffing levels and certify and place orders with suppliers.

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They also need to spend an extraordinary amount of time locating and training qualified distributors

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around the world.

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So any surprise in tariff policy from a trusted supplier or a critical foreign distributor

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in a country hit with a tariff can bring production to an absolute standstill.

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So replacing a supplier can take months and losing a foreign market can be devastating.

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I know it was for me when I focused a lot of my business on exports.

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So if one of those countries were no longer to bring in our product, that would hurt my

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bottom line and my ability to employ people.

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So these are the things that are really impacting Wisconsin companies as we go forward.

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And that's why the last year and a half has resulted in declining exports for Wisconsin

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companies.

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Our businesses just need clarity on what the rules of the world will be.

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What sector in Wisconsin will be hit the hardest in this?

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Well, clearly our exports to Canada, as you mentioned, are large, but they've been declining

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as well.

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So we saw an 8.6% decline, which is about $700 million in the last level.

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That's the lowest level of exports to Canada we've had since 2020.

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And just to prove that we aren't alone with Canada, our exports to Mexico have also declined

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by about 7.1%.

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In terms of some of the industries that you mentioned that might be hit, our top exports,

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as you mentioned, are industrial machinery.

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And in that category, our exports were down about 12% in 2025.

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So we export a lot of electrical machinery, various vehicle parts, sand, salt.

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We also are the largest, Canada is the largest recipient of agriculture goods from Wisconsin.

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So overall, the state of Wisconsin exported about $4 billion of ag products in 2025.

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And $1.4 billion of those went to Canada.

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So agriculture products are a huge factor for our local producers.

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Specific to that, even though Canada has a really tightly regulated dairy industry, how

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important are Wisconsin dairy exports to Canada?

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You know, that's a really great question.

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There's been a lot of talk about some of the really large tariffs that Canada has placed

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on Wisconsin dairy products.

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I worked on the Ways and Means Committee when I was a congressional staffer in the 90s.

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And that's when Canada imposed a 300% tariff on dairy products for U.S. companies.

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But it's been on the books for over 30 years.

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So the big difference there is that producers have had decades of consistency.

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So they know what the playing field is and they've had time to adjust their distribution

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channels.

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And according, interestingly, this is an interesting fact, according to the International Dairy

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Foods Association, the U.S. has really never even gotten close to hitting the threshold

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to receive that 300% tariff.

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So the Canadian government reports that about 99.9% of agriculture products that flow into

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Wisconsin, excuse me, flow into Canada, are not subject to that.

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So Wisconsin imports, excuse me, exports millions and millions of dollars of dairy products

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to Canada and ag products accounted for about 20% of Wisconsin's exports to Canada in 2025.

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So it is a big part of our export market.

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And it's not just dairy products.

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We do other agriculture products like prepared foods, beverages, wood products.

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And of course, you wouldn't be surprised that we also export a little summer sausage to them,

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too.

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But as far as dairy, whey, cheese and milk are the largest exports to Canada.

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What does this trade war mean for consumers, really drilling down to that level?

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Well, as I think we've seen in a lot of, at the grocery store in the last 18 months

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or so, we have heard lots of stories about products getting more expensive.

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And so Canada is bringing, as our other countries, bringing products into the U.S. that are going

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to be tariff, which means that they're going to have an impact on what consumers pay at

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the grocery store.

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But I think the bigger factor here is that Wisconsin is a producer.

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We produce not only machinery through our factories, but we produce products, dairy products

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and other things that go outside of the country.

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So when those products are limited in their distribution, our workers will have to potentially

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suffer not having a job if they can't have a reasonable place to sell their products.

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So it goes both ways.

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It's the price we pay for products, but it's also the ability for our workers to earn money

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producing those products.

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Could in the long run the imposition of U.S. tariffs deliver more markets to us and productivity

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here?

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I don't know.

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I would say no.

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And the reason why I would say no is that, as I mentioned, I ran an agriculture equipment

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manufacturing company.

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Half of our sales were outside the United States, and we exported to Canada, which was

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one, which had no tariffs.

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We also exported to Ukraine and Russia and Kazakhstan and South Africa and Australia

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and a number of countries that didn't limit our products going in.

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And so that allowed me to employ hundreds of people in Manitowoc, Wisconsin, to produce

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those products.

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So the theory that if we tariff some products coming in that we will do better by our local

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industries is also fairly moot because I was also buying a lot of steel.

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And if we're only going to limit that production to U.S. steel manufacturers, the price of steel

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would go up.

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So, therefore, my product that I was using steel to produce was going to go up as well,

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which again is something that hurts consumers not only in the United States, but around

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the world.

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So the Trump administration, this is kind of on an adjacent matter, worked to soften the

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blow of inflation by importing beef and then selling it at a discount.

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That proves to be not popular with farmers.

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But what do you make of that kind of market manipulation?

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I think it's distressing, it's a solution to a problem that doesn't exist.

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We have plenty of beef producers here in Wisconsin, we have plenty in the United States that

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can produce enough beef for our consumption and also then have enough extra to export.

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So any time you bring in a cheap product here, that may satiate some local demand, but what

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it then does is it makes it difficult for our producers to then sell their product overseas

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as well.

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So, it may help for a short period of time, an American consumer at the grocery store.

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But there are plenty of beef producers here in Wisconsin that are going to suffer because

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a lot of their products go outside of our borders.

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As to this Canada U.S. trade war that we are in the midst of right now, do you suspect

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it will resolve soon?

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I can certainly hope so because we're feeling the effects right here at the WEDC.

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For example, we host trade missions, it's part of the mission of the WEDC and we typically

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host a trade mission with Canada and with Mexico every year because there are largest trading

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partners.

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And we had last year two separate trade missions scheduled with Canada and we have Wisconsin

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companies that we bring along to help them sell their goods in Canada.

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But we learned from our Canadian counterparts across the border that they were reluctant

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to engage and meet with our producers because they were concerned about the changing nature

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of tariffs.

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So we actually had to cancel that trade mission.

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And so we tried again in November, again, we got the same response.

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But we at the WEDC will remain undeterred.

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We decide that we take a different, very local approach.

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So we meet with state-by-state relationships in other countries.

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So our goal is to meet with officials inside of Canada provinces to see if we can continue

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to forge paths going forward because administrations will come and go.

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But our Wisconsin's relationship with Canada, just like the relationship that the U.S. has

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with Canada, has been in existence for hundreds of years.

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It's going to be in existence for a hundred more.

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So we really need to do our best to keep those relationships positive.

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All right.

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We leave it there.

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John Miller.

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Thanks so much.

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Thanks for having me.

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I appreciate it.

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That was, that was really, I went really long with that and I appreciate your indulgence.

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No problem.

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Yeah.

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I'm happy to do it.

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All right.

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Well, thank you.

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Enjoy the weekend.

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If you don't have to work.

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I will do so.

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You too.

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Well, you never know.

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Thank you.

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Thank you.

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Bye.

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Bye.