In a letter released on his social media platform, Trump told Canadian Prime Minister Mark Carney the new rate would go into effect on August 1 and would go up if Canada retaliated.

In a post on X late on Thursday, Carney said his government will continue to defend Canadian workers and businesses in their negotiations with the U.S. as they work towards that deadline.

The 35 per cent tariff is an increase from the current 25 per cent rate that Trump had assigned to Canada and is a blow to Carney, who was seeking to agree a trade pact with Washington.

CUSMA exception expected

An exclusion for goods covered by the Canada-United States-Mexico Agreement (CUSMA) on trade was expected to stay in place, and 10 per cent tariffs on energy and fertilizer were also not set to change, though Trump had not made a final decision on those issues, an administration official said. Most agricultural goods fall under CUSMA.

Trump complained in his letter about what he referred to as the flow of fentanyl from Canada as well as the country’s tariff- and non-tariff trade barriers that hurt U.S. dairy farmers and others. He said the trade deficit was a threat to the U.S. economy and national security.

“If Canada works with me to stop the flow of Fentanyl, we will, perhaps, consider an adjustment to this letter,” Trump wrote.

Canadian officials say a miniscule amount of fentanyl originates from Canada but they have taken measures to strengthen the border.

“Canada has made vital progress to stop the scourge of fentanyl in North America. We are committed to continuing to work with the United States to save lives and protect communities in both our countries,” Carney added in his X post late Tuesday.

The prime minister said last month that he and Trump had agreed to wrap up a new economic and security deal within 30 days.

EU tariffs worry markets

Trump has broadened his trade war in recent days, setting new tariffs on a number of countries, including allies Japan and South Korea, along with a 50 per cent tariff on copper.

His latest salvo rattled investors anew, with U.S. and European stock futures dipping in Asia on Friday as markets nervously awaited word on what tariff Trump would assign the European Union later on Friday.

The potential escalation between the EU and the U.S. is a big deal for financial markets,” said Joseph Capurso, head of international economics at the Commonwealth Bank of Australia. “If you get something similar to (the U.S.-China trade war in April), that’s going to be very destabilising.”

In an interview with NBC News published on Thursday, Trump said other trading partners that had not yet received such letters would likely face blanket tariffs.

“Not everybody has to get a letter. You know that. We’re just setting our tariffs,” Trump said in the interview.

“We’re just going to say all of the remaining countries are going to pay, whether it’s 20 per cent or 15 per cent. We’ll work that out now,” Trump was quoted as saying by the network.

Countries looking to make deals

Myanmar’s ruling military general has asked Trump to reduce the 40 per cent tariff rate on his country’s exports to the U.S. to 10-20 per cent and is ready to send a negotiation team to Washington if needed, state media reported on Friday.

The president of the Philippines will meet Trump in Washington this month for the first time and will discuss its 20 per cent tariff, the country’s foreign minister said.

Canada is the second-largest U.S. trading partner after Mexico, and the largest buyer of U.S. exports. It bought $349.4 billion of U.S. goods last year and exported $412.7 billion to the U.S., according to U.S. Census Bureau data.

Carney, who led his Liberal Party to a comeback election victory earlier this year with a pledge to tackle trade challenges with the U.S., had been aiming to negotiate a trade deal with its key trading partner by July 21.

Trump, in his letter, did not specifically address how trade negotiations were proceeding, but he said the “tariffs may be modified, upward or downward, depending on our relationship with your Country.”

Last month, the Carney government scrapped a planned digital services tax targeting U.S. technology firms after Trump abruptly called off trade talks saying the tax was a “blatant attack.”

— Additional reporting by Jasper Ward and Surbhi Misra

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“We want a level playing field,” Trump told reporters in the Oval Office, discussing the measures.

The tariffs were not going into effect on Thursday but could begin to be imposed within weeks as Trump’s trade and economic team study bilateral tariff and trade relationships, a White House official told reporters on a conference call.

Howard Lutnick, Trump’s pick for Commerce secretary, said the administration would address each affected country one by one. He said the administration’s studies on the issue would be completed by April 1.

Trump, who campaigned on a pledge to bring down consumer prices, said prices could go up in the short term as a result of the moves. “Tariffs are great,” he said.

The White House official, who spoke to reporters before Trump’s event in the Oval Office, said the administration would examine what it called the most “egregious” issues first, including countries with the biggest trade surpluses and highest tariff rates.

Trump’s reciprocal tariffs would match the higher duty rates charged by other countries, he said. They also would aim to counteract non-tariff trade barriers such as burdensome regulations, value-added taxes, government subsidies and exchange rate policies that can erect barriers to the flow of U.S. products to foreign markets.

The effort also aims to launch negotiations with some countries to reduce these barriers.

The announcement appeared designed at least in part to trigger talks with other countries. The official said Trump would gladly lower tariffs if other nations lowered theirs.

“So the president is more than happy to lower tariffs if countries want to lower tariffs. But let’s also recognize that tariffs, higher tariffs, are not the biggest part of the problem in many, if not most cases,” the official said.

Targets include China, Japan, South Korea and the European Union. The tariffs would avoid a “one size fits all” approach for more customized levies, he said, though he did not rule out a flat global tariff.

The official said a lack of U.S. reciprocal tariffs had contributed to a large and persistent U.S. trade deficit.

Indian Prime Minister Narendra Modi, who was scheduled to arrive Thursday afternoon, oversees a government that imposes the highest tariffs on U.S. exports of any major U.S. trading partner. Trump acknowledged as much on Thursday.

The Republican president’s latest round of market-rattling tariffs has ratcheted up fears of a widening global trade war and threatened to accelerate U.S. inflation.

Trump’s trade advisers were finalizing plans on Wednesday for the reciprocal tariffs the U.S. president has vowed to impose on every country that charges duties on U.S. imports.

Trump, who took office on Jan. 20, has already announced tariffs on all steel and aluminum imports beginning on March 12, imposed 10 per cent tariffs on goods from China, and imposed a 30-day hold on tariffs on goods from neighboring Canada and Mexico.

Trump said on Monday he was also looking at separate tariffs on cars, semiconductors and pharmaceuticals. On Thursday he said car tariffs would be coming soon.

Trade experts say structuring the reciprocal tariffs that Trump wants poses big challenges for his team, which may explain why the latest duties were not announced earlier in the week.

Damon Pike, a trade specialist and principal with the U.S. division of accounting firm BDO International, said the reciprocal tariffs that Trump envisioned would result in a monumental undertaking, given that each of the 186 members of the World Customs Organization had different duty rates.

“At the international level, there’s something like 5,000 different descriptions at the 6-digit (product subheading) level, so 5,000 times 186 nations. It’s almost an artificial intelligence project,” he said.

Experts say Trump could turn to several statutes, including Section 122 of the Trade Act of 1974, which would only allow a flat rate maximum of 15 per cent for six months, or Section 338 of the Tariff Act of 1930, which provides authority to act against trade discrimination that disadvantages U.S. commerce, but has never been used.

Trump also could use the same International Emergency Economic Powers Act used to justify the tariffs imposed on China and pending for Canada and Mexico.

The White House official said that measure and others could be used.

“Absent IEEPA, there would need to be some kind of agency action first before any trade remedy tariffs can be imposed … but everything seems to be on the fast track,” Pike said, adding that normally tariffs would be done by Congress.

—Reporting by Andrea Shalal, David Lawder, Jeff Mason and Susan Heavey

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The European Union indicated it may retaliate and Trump promised further announcements on Tuesday or Wednesday of broader reciprocal tariffs to match those of countries importing U.S. goods.

Speaking to reporters on Air Force One on his way to Sunday’s NFL Super Bowl in New Orleans, Trump said he would announce the metals tariffs on Monday and the reciprocal tariffs soon afterwards, adding “if they charge us, we charge them.”

The largest sources of U.S. steel imports are Brazil, Canada and Mexico, followed by South Korea and Vietnam, according to government and American Iron and Steel Institute data.

Meanwhile, Canada, whose extensive hydropower resources aid its metal production, accounted for 79 per cent of U.S. primary aluminum imports in the first 11 months of 2024.

During his first four-year term from 2017, Trump imposed tariffs of 25 per cent on steel and 10 per cent on aluminum.

But he later granted several countries exemptions, including Australia, Brazil, Canada and Mexico, and his successor Joe Biden later negotiated duty-free quota deals with Britain, Japan and the EU.

With more demands for exemption and negotiation in prospect, some said Trump’s action would first of all damage the U.S. economy by raising the cost of the raw materials it depends on.

“Canadian steel and aluminum support key industries in the U.S. from defense, shipbuilding and auto,” Canadian Innovation Minister Francois-Philippe Champagne posted on X.

“We will continue to stand up for Canada, our workers, and our industries.”

Australia, also a strategic U.S. ally, has been making representations on aluminum and steel for months.

“Australian steel and aluminum are creating thousands of good paying American jobs, and are key for our shared defense interests,” Trade Minister Don Farrell said.

European steelmakers account for about 15 per cent of imports into the United States. The European Commission said it saw no justification for the imposition of tariffs: “We will react to protect the interests of European businesses, workers and consumers.”

It said Commission President Ursula von der Leyen would meet U.S. Vice President JD Vance in Paris on Tuesday during an AI summit. The German government said it was “working towards ensuring that these measures (tariff increases) do not materialize.”

Trump also said that, while the U.S. government would allow Japan’s Nippon Steel to invest in U.S. Steel, it would not allow a majority stake.

“Tariffs are going to make (U.S. Steel) very successful again,” Trump said.

Nippon Steel declined to comment, but Japan’s Chief Cabinet Secretary Yoshimasa Hayashi said the company was considering a bold change in plan.

U.S. steel mill capacity usage jumped above 80 per cent in 2019 after Trump’s initial tariffs, but has since fallen as China’s global dominance – unaffected by its exclusion by tariffs from the U.S. market – has pushed down prices.

A Missouri aluminum smelter revived by the previous tariffs was idled last year by Magnitude 7 Metals.

Kevin Dempsey, head of the American Iron and Steel Institute, said it would work with Trump “to implement a robust and reinvigorated trade agenda to address the many foreign market-distorting policies and practices that create an unlevel playing field for American steelmakers.”

Trump also promised detailed information on Tuesday or Wednesday on his reciprocal tariff plan.

The president has long complained about the EU’s 10 per cent tariff on auto imports, much higher than the U.S. car rate of 2.5 per cent.

However the U.S. applies a 25 per cent tariff on pickup trucks, a vital source of profit for Detroit automakers General Motors, Ford and Stellantis’ U.S. operations.

Overall, the U.S. trade-weighted average tariff rate is about 2.2 per cent, according to World Trade Organization data, compared to 12 per cent for India, 6.7 per cent for Brazil, 5.1 per cent for Vietnam and 2.7 per cent for the EU.

Chris Swonger, CEO of the Distilled Spirits Council of the United States, said Trump’s new steel tariffs could lead to the EU imposing retaliatory duties on American whiskey.

“We are urging that the U.S. and EU move swiftly to find a resolution. Our great American whiskey industry is at stake. A 50 per cent tariff on America’s native spirit will have a catastrophic outcome for the 3,000 small distilleries across the United States,” he said.

Trump had already threatened to impose tariffs of 25 per cent on all imports from America’s two largest trading partners, Canada and Mexico, saying they must do more to halt the flow of drugs and migrants across the U.S. border.

After some border security concessions, Trump paused the tariffs until March 1. But he told Fox News that more measures were needed.

“Something has to happen, it’s not sustainable,” he said, “and I’m changing it.”

— Reporting by Jeff Mason and David Lawder. Additional reporting by Lidia Kelly in Melbourne, David Ljunggren and Costas Pitas.

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Biden said thousands of people with prior federal convictions could be denied employment, housing or educational opportunities and his executive action would relieve such “collateral” consequences.

Biden’s move fulfills a campaign promise and is likely to please members in his left-leaning political base ahead of the November midterm elections in which the president’s fellow Democrats are defending control of the House of Representatives and Senate.

“Too many lives have been upended because of our failed approach to marijuana. It’s time that we right these wrongs,” Biden said.

He urged state governors to follow suit.

“Just as no one should be in a federal prison solely due to the possession of marijuana, no one should be in a local jail or state prison for that reason, either,” Biden said.

Shares of cannabis growers and sellers surged following Biden’s comments, with Tilray Brands and Canopy Growth both jumping more than 20 per cent.

The results of a classification review could have wide ramifications. Presently the drug falls under the same classification as heroin and LSD and is in a higher classification than fentanyl and methamphetamine, the president said.

If marijuana classification were to ease at the federal level, that could allow major stock exchanges to list businesses that are in the cannabis trade, and potentially allow foreign companies to begin selling their products in the U.S.

While many states have legalized the medical or recreational use of cannabis, the substance remains illegal under U.S. federal law, forcing most major banks to deny their services to cannabis-related businesses.

The issue has forced U.S. marijuana companies to trade their shares over the counter or by listing in Canada, with the Nasdaq and New York Stock Exchange prohibited from listing them.

The president’s action drew praise from some members of Congress.

“The Progressive Caucus applauds this action by President Biden today to advance criminal and racial justice,” said Representative Pramila Jayapal, who chairs a group of left-leaning lawmakers, in a statement.

Biden said he had directed Attorney General Merrick Garland to develop an “administrative process” to issue certificates of pardon to those who are eligible.

“The Justice Department will expeditiously administer the President’s proclamation, which pardons individuals who engaged in simple possession of marijuana, restoring political, civil, and other rights to those convicted of that offense,” the department said in a statement.

Biden said certain rules needed to stay in place even as regulations around the country loosened.

“Finally, even as federal and state regulation of marijuana changes, important limitations on trafficking, marketing, and underage sales should stay in place,” Biden said.

— Reporting for Reuters by Jeff Mason and Doina Chiacu; additional reporting by Noel Randewich, Shariq Khan and Richard Cowan.

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FDA commissioner Robert Califf provided no details, but President Joe Biden said last week he was working to allow more formula to come in from other countries.

Empty or low-stock shelves stem partly from a February recall of powdered formula and a plant closure by one of the nation’s main manufacturers, Abbott Laboratories, after four babies who had been fed formula made there became ill from Cronobacter sakazakii infections.

Abbott took a step to reopen the plant on Monday, saying it had agreed with the FDA on the steps needed to resume production there. The company said it would restart the plant within two weeks after the FDA confirms it has met the requirements.

The shortage of Abbott’s skim milk-based formula has been compounded by supply-chain snags and historic inflation, leaving about 40 per cent of baby formula products out of stock nationwide, data shows.

Califf told NBC News he does not expect the shortage of the critical baby product to last until the end of year, adding on CNN that he expects the situation to gradually improve.

The White House separately said it was continuing talks with the major formula manufacturers to identify logistical hurdles and provide any transportation support that could help them and major retailers get formula to where it is needed.

“This is principally an issue of production more than goods movement,” Transportation Secretary Pete Buttigieg told reporters at a White House briefing.

Abbott said in a statement on Monday that after investigations by the FDA, Centers for Disease Control and Prevention (CDC) and Abbott, there is no conclusive evidence to link Abbott’s formulas to these infant illnesses.

“We have been working to address the FDA’s observations so we can restart operations,” the company said in a statement on Monday.

Abbott has shipped to the U.S. millions of cans of formula from its FDA-approved Ireland facility.

As far as efforts to bring in baby formula from other countries that the FDA deems safe for import, Califf said: “I expect by the end of the day today that we’re likely to have an announcement about that path forward.”

Representatives for the health agency did not respond to a request seeking more details on the plan.

White House National Economic Council director Brian Deese told reporters he expected the FDA to issue import guidance as soon as Monday.

A White House official earlier said the government has offered transportation and logistics support to Abbott as well as Reckitt Benckiser, Nestle and Perrigo, in addition to top retailers such as Target, Amazon and Walmart.

Congress this week also plans to address infant formula rules regarding the Women, Infants and Children program, a federal assistance nutrition program administered by U.S. states, as well as emergency funding to shore up supplies.

— Reporting for Reuters by Susan Heavey, Jeff Mason and Trevor Hunnicutt; additional reporting by David Shepardson, Caroline Humer and Leroy Leo.

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“I’m not taking any options on or off the table,” White House spokesperson Jen Psaki told a briefing when asked about a carbon tax.

Psaki said President Joe Biden believed it was possible to design a carbon tax that would not violate his pledge not to raise taxes on people making $400,000 or less a year (all figures US$).

Some Democrats, including Senator Ron Wyden, have focused on a carbon tax as a possible alternative as Manchin opposes a key measure in the spending bill called the Clean Energy Payment Program (CEPP).

That measure, which would reward power utilities for investing in renewable energy such as wind and solar and fine those who do not, has been backed by Biden to achieve his climate goals including cutting U.S. emissions by about 50 per cent by 2030 compared to 2005 levels but is effectively dead, Congressional sources say.

Manchin indicated a carbon tax was not in play.

“The carbon tax is not on the board at all,” he told reporters. Manchin, a fellow Democrat, is a centrist from West Virginia, the top U.S. coal producing state after Wyoming.

Representative Pramila Jayapal, the chair of the Progressive Caucus, told reporters that a carbon tax did not come up in a meeting she and other Democrats held with Biden at the White House on Tuesday.

Under a carbon tax, the government sets a gradually rising price for each ton of greenhouse gas that polluters emit, incentivizing industries to move to cleaner energy sources.

One source familiar with discussions in Congress around a carbon tax said the Senate finance committee is weighing a fee in the range of $15-$18 per tonne of CO2 that would steadily rise over the years. Much of the revenue would be returned to consumers as cash payments.

With the U.N. climate summit in Glasgow due to begin in less than two weeks, the White House has been making the case that it can reach Biden’s climate goals even if the legislation does not have everything Biden wanted, including the CEPP.

Psaki cited a report from Rhodium Group, an independent research organization, to underscore White House confidence that Biden’s goals can be met.

Biden moved to re-enter the Paris climate agreement on his first day in office, but he had relied on Congress to deliver legislation to deliver a bulk of the emissions reductions he pledged by the end of the decade.

The back-and-forth among his fellow Democrats in Congress over his bills has threatened to undermine his efforts to reassure the world that he can deliver the U.S. national pledge to slash emissions up to 52 per cent below 2005 levels by 2030.

If Congress is forced to drop certain climate measures, the legislation would still take huge steps on global warming with incentives for electric vehicles and expanded tax credits for renewable power such as wind and solar, according to John Larsen, an author of the report.

“I’m much more worried about no deal than trimmed down bills,” he said.

Manchin urged lawmakers to pass the $1 trillion bipartisan infrastructure bill before the wider spending bill and in time for the U.N. climate talks that start at the end of the month.

Progressive Democrats have said the bills should be passed together to ensure that the debate on wider legislation on climate and social programs does not slip into next year, or get abandoned altogether.

“We have the trust in each other, we should be able to vote immediately on the bipartisan infrastructure bill, which is a tremendous piece of legislation for the president to take with him to Glasgow,” Manchin told reporters.

— Reporting for Reuters by Timothy Gardner, Trevor Hunnicutt, Jeff Mason and Valerie Volcovici.

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JBS is the world’s largest meatpacker and the cyberattack caused its Australian operations to shut down on Monday and has stopped livestock slaughter at its plants in several U.S. states plus at least one in Canada.

The attack follows one last month by a group with ties to Russia on Colonial Pipeline, the largest fuel pipeline in the United States, that crippled fuel delivery for several days in the U.S. Southeast.

White House spokeswoman Karine Jean-Pierre said the United States has contacted Russia’s government about the matter and that the FBI is investigating.

“The White House has offered assistance to JBS and our team at the Department of Agriculture have spoken to their leadership several times in the last day,” Jean-Pierre said.

“JBS notified the administration that the ransom demand came from a criminal organization likely based in Russia. The White House is engaging directly with the Russian government on this matter and delivering the message that responsible states do not harbour ransomware criminals,” Jean-Pierre added.

JBS sells beef and pork under the Swift brand, with retailers such as Costco carrying its pork loins and tenderloins. JBS also owns most of chicken processor Pilgrim’s Pride, which sells organic chicken under the Just Bare brand.

If the outages continue, U.S. consumers could see higher meat prices during summer grilling season and meat exports could be disrupted at a time of strong demand from China.

The disruption has already had an impact, industry analysts said. U.S. meatpackers slaughtered 94,000 cattle on Tuesday, down 22 per cent from a week earlier and 18 per cent from a year earlier, according to estimates from the U.S. Department of Agriculture. Pork processors slaughtered 390,000 hogs, down 20 per cent from a week ago and seven per cent from a year ago.

Prices for choice cuts of U.S. beef shipped to wholesale buyers in large boxes jumped $3.59, to $334.56 per hundredweight, USDA said (all figures US$). Prices for select cuts climbed $5.55, to $306.45/cwt.

The USDA, Department of Homeland Security and other agencies are closely monitoring the meat and poultry supply, a White House official said. The agencies are also working with agricultural processors to ensure products move efficiently and that no price manipulation occurs as a result of the cyberattack, the official said.

Affected systems suspended

JBS said it suspended all affected systems and notified authorities. It said its backup servers were not affected. A company representative in Sao Paulo said there was no impact on Brazilian operations.

The company said Sunday’s cyberattack affected its North American and Australian IT systems and “resolution of the incident will take time, which may delay certain transactions with customers and suppliers.”

JBS, with North American operations headquartered at Greeley, Colorado, controls about 20 per cent of the slaughtering capacity for U.S. cattle and hogs, according to industry estimates.

“The supply chains, logistics, and transportation that keep our society moving are especially vulnerable to ransomware, where attacks on choke points can have outsized effects and encourage hasty payments,” said threat researcher John Hultquist with security company FireEye.

U.S. beef and pork prices are already rising as China increases imports, animal feed costs rise and slaughterhouses face a dearth of workers. Any further impact on consumers will depend on how long production is down, market analysts said.

“If it goes on a week or longer, you’ve got a major problem,” said Dennis Smith, broker for Archer Financial Services in Chicago.

Two kill and fabrication shifts were canceled at JBS’s beef plant at Greeley after the cyberattack, representatives of the United Food and Commercial Workers (UFCW) International Union Local 7 said in an email. JBS Beef in Cactus, Texas, also said on Facebook it would not run on Tuesday.

UFCW urged JBS to ensure workers receive their contractually guaranteed pay during the shutdowns.

JBS Canada said in a Facebook post that shifts had been canceled at its plant at Brooks, Alta., on Monday and one shift so far had been canceled on Tuesday. JBS’s Canadian assets also include case-ready meat processing plants at Calgary and at Belleville, Ont.

The United States Cattlemen’s Association, a beef industry group, said on Twitter that it had reports of JBS redirecting livestock haulers who arrived at plants with animals ready for slaughter.

Last year, cattle and hogs backed up on U.S. farms and some animals were euthanized when meat plants were shut during coronavirus outbreaks among workers.

A JBS beef plant in Grand Island, Nebraska, said only workers in maintenance and shipping were scheduled to work on Tuesday.

Over the past few years, ransomware has evolved from one of many cybersecurity threats to a pressing national security issue. A number of gangs, many of them Russian-speakers, develop the software that encrypts files and then demand payment in cryptocurrency for keys that allow the owners to decipher and use them again.

Canadian federal officials in March announced funding for an initiative to promote and improve cybersecurity in the agriculture industry.

That funding, part of a larger national cybersecurity co-operation program, was expected to help close “critical gaps” in the sector.

— Reporting for Reuters by Caroline Stauffer, Tom Polansek and Mark Weinraub; additional reporting by Jeff Mason, Trevor Hunnicutt, Ana Mano and Joe Menn.

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With concerns about food shortages and supply chain disruptions, Trump issued an executive order using the Defense Production Act to mandate that the plants continue to function.

The world’s biggest meat companies, including Smithfield Foods, Cargill, JBS USA and Tyson Foods, have halted operations at about 20 slaughterhouses and processing plants in North America as workers fall ill, stoking global fears of a meat shortage.

The order is designed in part to give companies legal cover with more liability protection in case employees catch the virus as a result of having to go to work.

Tyson chairman John H. Tyson said Sunday that the food supply chain was “breaking” and warned of the potential for meat shortages.

Before issuing the executive order, Trump told reporters in the Oval Office that signing the order “will solve any liability problems,” adding, “And we always work with the farmers. There’s plenty of supply.”

The executive order, released Tuesday evening, said the closure of just one large beef-processing plant could result in 10 million fewer individual servings of beef in a day.

“Such closures threaten the continued functioning of the national meat and poultry supply chain, undermining critical infrastructure during the national emergency,” the order said.

A senior administration official said the U.S. government would also provide guidance to minimize risk to workers who are especially vulnerable to the virus, such as encouraging older workers and those with other chronic health issues to stay home.

Unions were not impressed. Some farmers said it was too late because pigs had been euthanized already instead of the pork going to market.

“While we share the concern over the food supply, today’s executive order to force meatpacking plants to stay open must put the safety of our country’s meatpacking workers first,” United Food and Commercial Workers said in a statement.

UFCW, the largest U.S. meat-packing union, demanded that the administration compel meat companies to provide “the highest level of protective equipment” to slaughterhouse workers and ensure daily coronavirus testing.

The senior administration official, speaking on condition of anonymity, said if action were not taken, the vast majority of processing plants could have shut down for a period of time, reducing capacity by as much as 80 per cent.

Saving workers’ lives

The order was little consolation for farmers such as Henry Moore of Clinton, North Carolina, who in recent weeks aborted thousands of unborn piglets and euthanized newly born because of closures of packing plants.

“At this point, honestly, it’s a little too late,” Moore said. “There’s millions and millions and millions of pounds of pork that will never make it to the market.”

Tyson said on Wednesday it was closing two pork-processing plants, including its largest in the United States, further tightening meat supplies following other major slaughterhouse shutdowns.

U.S. meat companies slaughtered an estimated 283,000 hogs on Tuesday, down about 43 per cent from before plants began shutting because of the pandemic, according to U.S. Department of Agriculture data. Processors slaughtered about 76,000 cattle, down about 38 per cent.

Critics of Trump’s order made clear that plants were being shut down for a reason.

“When poultry plants shut down, it’s for deep cleaning and to save workers’ lives. If the administration had developed meaningful safety requirements early on as they should have and still must do, this would not even have become an issue,” Stuart Appelbaum, president of the Retail, Wholesale and Department Store Union, said in a statement.

The White House worked directly with executives from the meat-processing companies to determine what they needed to stay open safely, the administration official said. He said there were enough workers who could safely go to work and ensure the supply chain continued to churn.

More than 6,500 meat- and food-processing workers have been infected with or exposed to the new coronavirus, and 20 have died, UFCW said Tuesday.

Administration officials and some Republicans on Capitol Hill have said that businesses that are reopening need liability protection from lawsuits employees might file if they become sick.

Senate Democratic leader Chuck Schumer, speaking to reporters on a teleconference on Tuesday that mainly centered on immigrants working in the healthcare sector, was asked about Senate majority leader Mitch McConnell’s pushing for business liability protections as they reopen their operations.

“Is he saying if an owner tells a worker he needs to work next to a sick person without a mask and wouldn’t be liable? That makes no sense,” Schumer said.

— Reporting for Reuters by Jeff Mason and Tom Polansek; additional reporting by Tom Hals, Lisa Lambert, Richard Cowan and Steve Holland.

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Trump, on trial in the U.S. Senate on charges of abusing power and obstructing Congress, welcomed Republican senators at the South Lawn event by name. Other guests included lawmakers from around the country, workers, farmers and CEOs, and officials from Mexico and Canada, the White House said.

The Canada-U.S.-Mexico Agreement (CUSMA) will replace the 26-year-old North American Free Trade Agreement, including tougher rules on labour and automotive content but leaving US$1.2 trillion in annual U.S.-Mexico-Canada trade flows largely unchanged.

“Today, we are finally ending the NAFTA nightmare and signing into law the brand-new U.S.-Mexico-Canada Agreement,” Trump told the crowd. Flanked by a group of U.S. workers wearing hard hats, Trump said the agreement would bolster U.S. economic growth, benefiting farmers, workers and manufacturers.

He said his concerns about NAFTA triggered outsourcing had triggered his run for the presidency in 2016.

A wide array of business groups welcomed the agreement, which also won a rare endorsement of the AFL-CIO union federation. Mexico has already approved the deal, but it must still be ratified by Canada’s Parliament before it can take effect.

The influential United Autoworkers said the new deal would not restore hundreds of thousands of U.S. manufacturing jobs lost to Mexico after NAFTA, and vowed to be aggressive in pushing for enforcement of the trade agreement’s provisions.

Democratic presidential candidate Bernie Sanders, a Vermont senator who voted against the pact earlier this month, said the NAFTA replacement deal would not stop the offshoring of U.S. jobs and amounted to “a giveaway to the fossil fuel industry.” He said he would immediately renegotiate the pact if elected.

Canadian Prime Minister Justin Trudeau, speaking in Ottawa, said his minority government would continue to answer questions posed by various industries and other groups.

“We have questions and we have a process for ratification. I just look forward to getting, getting through it responsibly and rapidly because it’s so important for Canadians,” he said.

No Democrats

Excluded from the event were House of Representatives Speaker Nancy Pelosi, House ways and means committee chairman Richard Neal and other Democrats who negotiated with the Trump administration for months to expand the pact’s labour, environmental and enforcement provisions and pave the way for its approval by the Democratic-controlled House.

Trump did not mention the work done by Pelosi or other Democrats on the trade pact, but U.S. Trade Representative Robert Lighthizer, in his remarks at the ceremony, acknowledged the role that House leaders played in getting the deal done.

Partisan tensions were running high as U.S. senators started to pose questions in Trump’s impeachment trial, ahead of a key vote later this week on whether to allow the calling of witnesses such as former national security adviser John Bolton.

The White House on Wednesday objected to the publication of a book written by Bolton that depicts Trump as playing a central role in a pressure campaign on Ukraine to launch investigations of Democrats, including former Vice-President Joe Biden, a top contender for the Democratic nomination to face Trump in this year’s election.

Pelosi told reporters that Democrats had ensured “vast improvements” to CUSMA before it was approved, despite their absence from Trump’s White House event, adding, “I hope he understands what he’s signing today.”

Neal told reporters some Republican senators thought the deal was “too Democratic.” He said the final accord won stronger protections for workers, better enforcement of environmental provisions and steps to prevent higher drug prices.

Representative Rosa DeLauro told reporters in a separate teleconference that Democrats would remain vigilant on oversight of the improved trade deal and would fight for even better climate protections in future trade deals.

The U.S. Senate this month overwhelmingly approved legislation to implement CUSMA, sending the measure to Trump for signing into law.

‘Long-term predictability’

U.S. lawmakers said it was unclear when the accord would take effect, since Canada’s main opposition Conservative Party had expressed concerns about aspects of the deal and there was no exact timeline for ratification there.

Even after Canada ratifies the accord, implementation could take several more months since the three countries must show they are meeting their obligations before the clock starts ticking on an effective date.

Export-minded Canadian farm groups were among those calling this week for the deal’s quick passage through Canada’s House of Commons and Senate.

“After three years of uncertainty, it’s time to restore long-term predictability to North American supply chains,” the Canadian Agri-Food Trade Alliance said Wednesday in a joint statement with other Canadian business organizations.

“The success of Canadian agriculture is not a partisan issue,” Grain Growers of Canada chair Jeff Nielsen, an Alberta grain grower, said Monday in a separate release. “We urge all parties to work together to see the legislation through.”

— Reporting for Reuters by Andrea Shalal and Jeff Mason; additional reporting by Susan Heavey, David Shepardson and Alexandra Alper in Washington and David Ljunggren in Ottawa. Includes files from Glacier FarmMedia Network staff.

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Trump said the deal would open up Japanese markets to some $7 billion worth of American products annually, cutting Japanese tariffs on U.S. beef, pork wheat and cheese (all figures US$).

U.S. Trade Representative Robert Lighthizer said after a signing ceremony between the two leaders on the sidelines of the United Nations General Assembly that cars — the biggest source of the $67 billion U.S. trade deficit with Japan — were not covered in the announcement.

Japan wanted further discussions on this issue, Lighthizer said.

It was not the U.S. intention to impose so-called Section 232 national security tariffs on Japanese autos and auto parts and the two sides would work together in good faith, aiming to start talks on phase two of an agreement next April, he said.

Japanese Foreign Minister Toshimitsu Motegi, who had negotiated the pact with Lighthizer, was more direct in saying that Japan received assurances that car tariffs would not be implemented.

“As long as the agreement is implemented faithfully, Section 232 will not be applied. This is what Prime Minister Abe confirmed with President Trump at the summit meeting,” Motegi told reporters.

A Japanese government statement also said further talks would seek to eliminate the existing 2.5 per cent U.S. tariff on Japanese cars and would not result in the imposition of U.S. import quotas on Japanese autos.

Lighthizer, during a previous stint at USTR in the 1980s, helped negotiate voluntary export restraints on Japanese autos, which led to increased U.S. production by Japanese automakers. But Japan still exports about 1.7 million cars a year to the United States, making up about 10 per cent of U.S. vehicle sales.

Wednesday’s deal was met with cautious praise from farm groups and lawmakers, who said they looked forward to a more complete deal.

Representative Jackie Walorski, an Indiana Republican, said she was “encouraged the deal will mean fewer barriers to digital trade and more certainty that costly auto tariffs will not threaten American jobs or raise prices for consumers.”

The U.S.-Japan talks, launched a year ago, hit a snag earlier this week as Japan had sought last-minute assurances that Trump would not impose the Section 232 tariffs.

The U.S. Trade Representative’s office characterized the agreement signed by Trump and Abe as “early achievements” from their negotiations on market access for agriculture, industrial goods and digital trade.

The deal could provide some limited relief for U.S. farmers, who have been battered by China’s retaliatory tariffs against U.S. soybeans, pork and other products in the 15-month-long trade war between Washington and Beijing.

Under the agreement, Japan would open new markets to about $7 billion in American agricultural products, Trump said. “Japanese tariffs will now be significantly lower or eliminated entirely for U.S. beef, pork, wheat, cheese, corn, wine and so much more.”

Trump later praised China’s recent agricultural purchases as “goodwill” measures and said a deal with Beijing could come sooner than people think.

Trump also said signing ceremony with Abe that the deal’s first phase would cover $40 billion worth of digital trade between the world’s largest and third-largest economies.

The USTR said about 90 per cent of U.S. food and agricultural products will receive duty-free or reduced-tariff access to Japan, but wheat will still be subject to a quota limiting the volume of U.S. imports.

However, many of the products gaining new access will still face tariffs that phase out over several years, including wine, ethanol, cheeses, processed pork, poultry, frozen potatoes, oranges, cherries and egg products.

Motegi told reporters that the tariff cuts on U.S. farm products are “within the range” of tariff cuts granted to countries in the Trans-Pacific Partnership trade deal, which Trump quit in 2017.

Japan will see reduced or eliminated tariffs on a small amount of agricultural goods, including cut flowers and soy sauce, and a wide range of industrial goods, including steam power turbines, machine tools, bicycles and musical instruments.

The digital trade agreement largely follows the U.S. model of internet development, prohibiting taxes on cross-border digital downloads and rules requiring so-called data localization — the storing of data on devices physically present within a country’s borders, the USTR said.

— Reporting for Reuters by Jeff Mason, David Lawder and David Brunnstrom.

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