Closed borders are costing U.S. businesses
Ban highlights importance of distribution deals to reach Canadian customers
WASHINGTON—In the before times, Katie McCarron could count on her best Canadian customers to make the trip to her store in Portland, Ore., to stock up on their favourite high-quality, human-grade pet food.
COVID-19 had other plans. Soon enough, though, so did Portland Pet Food Co.
“Some of them would just be shopping in Portland, and we’d hear that they had been here, or they’d write us and they’d be asking, ‘How can I order your food online with the border closed?” the B.C.-born McCarron said in a recent interview.
In the United States, however, every international shipment of pet food products requires a special health certificate, making it impossible for a small retailer like Portland Pet Food to offer online sales outside of the country.
“We can’t ship to Canada — it’s just too costly, and we do have to get these certificates issued each time we ship. So I just had to pursue getting into distribution.”
Today, thanks in large part to a deal with the Canadian chain Pet Valu, Portland Pet Food is available in more than 500 specialty retailers in Canada, an expansion that equates to about 25 per cent of the company’s worldwide retail footprint.
McCarron clearly already had expansion on her mind before the pandemic hit. Portland products are already available in Japan, and she recently signed an agreement for distribution in China.
But the ongoing ban on nonessential land travel from Canada to the U.S., tentatively extended now for a 19th month until Oct. 21, drove home the importance of winning shelf space in a part of the world where crossing the border is no longer as easy as it once was.
U.S. President Joe Biden’s administration drew a stark contrast last week when it announced a major retooling of the rules governing international travel and COVID-19, while at the same time extending the travel ban at the Canada-U.S. border.
McCarron is at a loss to explain why the U.S. continues to deny Canadians the ability to drive across the border for holidays, day trips or shopping excursions — a restriction the federal Canadian government began easing over the summer for fully vaccinated U.S. citizens and permanent residents.
The U.S. Travel Association says the ongoing closing of the Mexican and Canadian land borders is costing U.S. businesses an estimated $1.5 billion a month in “travel exports,” which the association defines as spending by foreign residents while visiting the U.S.
Canada, meanwhile, remains the largest single U.S. export market, accounting for nearly 18 per cent of all U.S. goods sent out of the country last year. The two countries trade $1.7 billion worth of goods and services each day, for a total of $614.9 billion in 2020.
“My constituents are deeply frustrated by this, particularly given the trade and the relationships that people have across the border,” Michigan Sen. Gary Peters said last week during national security hearings with Homeland Security Sec. Alejandro Mayorkas.
“We are very mindful of the economic consequences, and not only the economic consequences, but the consequences on family members who haven’t seen one another for quite some time,” Mayorkas replied. He said the progression of the Delta variant of COVID-19 “is not yet where we need it to be” in the U.S., and that there are communities near the U.S.Mexico border that are also suffering as a result of the closing.
“We are looking at the situation, not only at the ports of entry on our northern border, but also on our southern border,” Mayorkas said.
“We have heard similar concerns with respect to border communities on the South and the impact, economic and family impact, of the restrictions. We are looking at what we can do operationally, and we are moving in a very sequential and controlled manner.”
It’s jarring to consider the discrepancy in crossing the Canada-U.S. border by land, said Tori Barnes, executive vice-president of public relations and policy for the U.S. Travel Association.
White House press secretary Jen Psaki had no explanation Thursday for why the land border remains closed while the Biden administration is announcing new vaccination requirements for international visitors arriving by air.