The ongoing trade tension between the U.S. and Canada has led to Canada’s decision to suspend imports from the largest U.S. pork processing plant. The plant is operated by Smithfield Foods (SFD) in Tar Heel, North Carolina, and involves a specific problem with offal shipments from Smithfield’s facility. Offal refers to organs and other edible parts of animals that are often used in food products. According to Smithfield spokesman Jim Monroe, the company is working closely with the U.S. Department of Agriculture to resolve the matter. However, the exact nature of the problem is still unclear.
It is worth noting that President Donald Trump recently exempted Canadian and Mexican goods under the North American trade pact from the 25% tariffs for a month. This temporary relief comes after the U.S. imposed tariffs earlier in the week. Unsurprisingly, Trump’s tactics have led to concerns about retaliatory tariffs from trading partners, which would escalate into a trade war that could potentially harm American businesses.
Indeed, the Canadian province of Ontario recently stated that it would add a 25% surcharge starting Monday on the electricity used in New York, Michigan, and Minnesota. It even removed roughly 3,600 American alcohol products from its shelves. Ontario Premier Doug Ford wrote on social media that the province will continue to be “relentless” until “Trump removes the threat of tariffs for good.”
Is SFD Stock a Good Buy?
Turning to Wall Street, analysts have a Strong Buy consensus rating on SFD stock. In addition, the average SFD price target of $27.43 per share implies 40% upside potential from current levels.
