Employees at the Granby bottling plant of The Maple Treat, the world's largest bottler of maple syrup, work in the warehouse to prepare the syrup received from various producers before it goes on the production line.Renaud Philippe/The Globe and Mail
Inside Maple Treat Corp. headquarters in Granby, Que., Louis Turenne scans the factory floor from a perch in the lunch room, his eyes fixed on a steady stream of 1-litre plastic jugs being injected with gold-coloured liquid and plugged with green caps. Depending on the line, it’s 40 to 120 bottles per minute. Sweet maple syrup. Sweet profit. Now exposed.
The executive has his best game face on but a trade war is at his doorstep. U.S. President Donald Trump confirmed Monday that 25-per-cent tariffs on Canadian and Mexican goods would start Tuesday.
Mr. Turenne, a trim 50-something with glasses, oversees Rogers Sugar Inc.’s Maple Treat business and this facility is home base for its liquid syrup bottling and distribution operation. With its robot packers and automated lines, it’s about as far removed from the sugar shack’s traditional buckets, horses and trees as you can imagine. Still, what’s happening here is a centrepiece of Canadian maple exports.
“We want to sell,” says Mr. Turenne, who’s also president of the Maple Industry Council, a group representing major syrup buyers. “The key is making sure the lines don’t stop. When they stop, we don’t make money.”
The company is the largest maple syrup supplier in the world, laying claim to about a quarter of the global market and exporting more than 50 million pounds of sweet stuff a year that it buys from local farmers. Customers include Walmart, Publix and other names big and small. Much of the output goes into private label bottles.
U.S. shoppers consume 150 million pounds of maple syrup every year, two-thirds of it imported from Canada – a tally worth $440-million. Americans want what Canada makes with its ideal freeze-and-thaw weather cycles. And unless they shun the authentic stuff and turn to substitutes, they have no other option in the near future.
It took some convincing to get a sit-down with the maple boss. When Mr. Trump first threatened to slap import tariffs on Canadian goods and said he’d like to make Canada a U.S. state, maple industry representatives from producers to distributors ducked for cover. It was almost as if the entire $1-billion sector went into a self-imposed lockdown.
The reason for this is understandable. There’s no bigger emblem of Canadian identity than maple. It’s on our flag, on our hockey jerseys, on our bodies as tattoos. For decades, Canadian diplomats and businesspeople have tucked it in their bags as tokens of friendship. If there ever was a poetic target in a looming trade war with the United States, maple would be it.
The Granby bottling plant of The Maple Treat.Renaud Philippe/The Globe and Mail
“What we don’t want is that maple syrup become a symbol of the tariff crisis,” Mr. Turenne says, emphasizing the modest economic weight of the sector despite its emotion-tugging qualities. “If the American administration wanted to hit an industry to capture the imagination, maple might be it. So we’re trying to stay low profile.”
In Quebec’s maple tree forests, producers are gearing up now for the sugaring off season – outfitting the trees and readying the liquid harvest. In nearby board rooms, meanwhile, industry leaders have been running various U.S. tariff scenarios, plotting the options and likely outcomes. While there is certainly apprehension about what might happen, there is no outright panic.
True, a big chunk of their production and sales is now questionable. Quebec produces about 70 per cent of the world’s maple syrup and 55 per cent of that annual output is shipped to the United States. But the damage could be offset by other factors, including the perception by savvy shoppers that maple syrup is a must-have staple and the fact U.S. demand for the product far outstrips its own domestic supply.
Producers in Vermont, New York and Maine are growing, but not fast enough to satisfy their country’s appetite for maple syrup, according to Mr. Turenne. They also buy Canadian production equipment: The three main manufacturers are all Quebec companies.
U.S. bottlers source syrup from Canada to supplement domestic volumes while Canadian bottlers source from the United States to get the U.S. Origin designation needed on some products – all of which underscores the industry’s reliance on open borders. As members of the International Maple Syrup Institute, representatives in Canada and the United States recently signed a common declaration opposing any trade barriers.
“Maple syrup comes mostly from here,” Quebec Premier François Legault said at a news conference in late January. “Mr. Trump can try to make maple syrup in Florida but he won’t succeed. So Americans will have a choice: Either pay 25 per cent more if there’s a 25 per cent tariff on it, or eat syrup that’s not as good.”
'What we don’t want is that maple syrup become a symbol of the tariff crisis,' says Louis Turenne, CEO of The Maple Treat Corp.Renaud Philippe/The Globe and Mail
Canada’s maple syrup industry is on a roll at the moment, with export sales through the first 11 months of 2024 up 7 per cent. The danger now isn’t that it might lose market share to other countries. There are no other nations exporting the sweet staple into the United States. Rather, it’s price elasticity, Mr. Turenne says.
If and when tariffs come in on Canadian goods, maple syrup packers will have to pass the cost onto their retail customers because they can’t absorb that added expense. And so the price on U.S. store shelves will go up. The big unknown is to what extent sales will go down.
“The risk is consumers may substitute pure maple syrup with something else that’s cheaper on the shelf,” Mr. Turenne says.
Those other options include corn syrup, molasses or even honey. But they don’t have the same flavour and not all of them can match maple’s health benefits as a natural product, he says. He compares the potential sticker shock that Americans might see to the recent price run-up of olive oil.
“What happened? Did people stop buying olive oil? I did not. I assume you did not. Nobody did,” Mr. Turenne says.
Americans consider maple syrup as something of a high-end product. They use one quart – roughly one litre – of maple syrup per year per person on average, according to data the executive shared. And so even though they consume a lot of it as a country, they do not consume much on an individual basis.
“I don’t think they’re going to stop buying it because it’s not a big portion of their grocery spending,” Mr. Turenne says. He says he’s optimistic that a price hike of a few dollars per bottle won’t stop consumers and that on the whole, the U.S. market remains one with a “big untapped potential.”
Employees work on the production line. Mr. Turenne, who’s also president of the Maple Industry Council, says his priority is making sure the lines keep running.Renaud Philippe/The Globe and Mail
Canada is expected to punch back with countertariffs on U.S. imports if Mr. Trump carries out his threat. The proceeds from those countermeasures should be reinvested in Canadian exporters, including maple syrup producers and packers, to allow them to ramp up promotional strategies, Mr. Turenne says.
“Is this good? No. How bad is it going to be? It’ll depend on how long it’s going to last,” said David Hall, a farmer who makes syrup in the hamlet of Iron Hill, Que. He declined to speak in greater detail.
Quebec’s maple industry is overseen by a government-sanctioned cartel called the Federation of Quebec Maple Syrup Producers, known by its French acronym PPAQ. The group sets minimum prices for bulk shipments, regulates production volumes through quotas, and monitors safety and quality standards.
Syrup that’s not sold goes to a warehouse in Laurierville, Que. The unsold barrels are known as the strategic reserve, which can be drawn on when weather conditions yield a lower crop. Syrup stored under proper conditions can last years without losing value.
Maple farmers aren’t paid for unsold syrup that goes to the warehouse. If Mr. Turenne is wrong and U.S. sales do tank, the PPAQ is eyeing backing from the Quebec government to finance the strategic reserve and maintain payments for producers.
One possible mechanism that might be used is a zero-interest loan guaranteed by Quebec against the value of the unsold syrup, says PPAQ spokesman Joël Vaudeville. The loan would be reimbursed when the tariff storm clears and the syrup is sold, he said. Quebec counts 8,400 businesses active in maple syrup production.
“Those farmers are super busy right now but they’re working with this dark cloud hanging overhead,” Mr. Vaudeville says.
Any U.S. tariffs that stretch out over years will benefit American farmers and accelerate the development of the industry south of the border, says Maurice Doyon, professor of agricultural economics and consumer science at Laval University.
Quebec sets the standard for North American prices and a U.S. import tariff also strengthens what U.S. producers will be able to charge as a result, he says. On the flip side, a declining Canadian dollar will limit their ability to fully capture that gain, he says.
“Nobody’s going to run and buy new equipment tomorrow to ramp up maple syrup output,” Mr. Doyon says. “They’ll wait to see how long it plays out. And if they’re convinced it’s here to last, then they’ll invest.”
President Donald Trump said on Monday that there was no chance for Canada or Mexico to prevent 25 per cent tariffs from taking effect on Tuesday, sending financial markets reeling on the prospect of new economic barriers.
Reuters