An Ontario ice cream company is fighting back against “unjustified tariffs” by sourcing more non-American ingredients.
“We stand with the Canadian government, and all provinces, in our outright rejection of these unjustified tariffs,” Chapman’s Ice Cream said in a post on its Instagram account Wednesday. The company said it is on track to convert more than 70 per cent of its American ingredients by mid-2027 and will continue to use 100 per cent Canadian dairy.
Chapman’s wrote that it will not raise prices before March 2028.
The U.S. imposed a 50 per cent tariff on $27.6 billion of Canadian goods on Aug. 22, after trade talks collapsed. Canada announced it would match tariffs dollar for dollar starting on Sept. 8, at rates of 15, 25 and 50 per cent.
Ashley Chapman, the Markdale, Ont., company’s chief operating officer, said the latest round of tariffs is insulting to Canadians and to Canadian industry.
“It’s a deplorable situation, but it is what it is,” Chapman said. “We’ve got to do what’s right for Canada and we need to move on and diversify our economy to the point where we don’t have to get into these situations where a hostile American administration can hold us hostage.”
The tariff war sent Chapman’s shopping in Canada, Australia and Chile.
Chapman’s entire almond supply moves to an Australian company by the middle of next year, Chapman said. Wafers are going to a Canadian company shortly and cherries to a Chilean supplier he said is slightly cheaper with a better product.
“Just that concept, that we can ship almonds all the way from Australia for a slightly lower price than we’re getting in the United States, which is in our backyard, is kind of crazy,” Chapman said. “And it’s blowing our minds a little bit.”
The big cone manufacturers are all American, Chapman said.
His purchasing director asked Original Foods, one of the company’s Ontario suppliers, whether it would consider making cones, he said.
The plant had space, Chapman said. About a month later Original Foods came back with a machine it could buy, an offer to match the American price and a request for a multi-year agreement guaranteeing volume.
“This is a machine, this is an oven, this is a product that isn’t available in Canada,” Chapman said.
The conversion should be finished by the end of the year, he said. “So we’re going to be the only ice cream company in the country that can offer a 100 per cent Canadian dairy and a 100 per cent Canadian sourced sugar cone.”
Chapman told AM800 CKLW that dairy landing in the tariffs will probably raise costs and that the company will absorb them through next year.
Sylvain Charlebois, senior director of the Agri-Food Analytics Lab at Dalhousie University, said in an email to National Post that tariffs on American dairy should not directly raise those costs for a company buying only Canadian milk. The pressure arrives indirectly, he wrote, through packaging, equipment and other ingredients.
Chapman said the company made the announcement on social media because it has customers in every province and territory. He said Chapman’s will “do our absolute best to make sure that prices for our products at least do not go off the rails.”
“Chapman’s can hold the prices it charges retailers, but it can’t control the final price consumers see in stores,” Charlebois wrote. He called holding prices that far out a bold commitment, and one that will likely mean the company makes less on each product, negotiates harder with suppliers and finds savings elsewhere.
Replacing 70 per cent of the American ingredients by mid-2027 is ambitious but possible for a company of Chapman’s size, Charlebois wrote. The work requires testing, reformulation, new labels and quality checks, he wrote.
Price is still one of the biggest factors, Chapman said, and the company will not pay double for a component just because it is not American.
Switching suppliers is not free, Charlebois wrote, and in the short term, absorbing the tariff may be cheaper. Chapman’s carries that cost first, and it could later show up in promotions, investment or prices.
“The two promises can hold at the same time, but Chapman’s is taking on a fair amount of financial risk to make that happen,” Charlebois wrote.
Chapman’s has made ice cream in Markdale since 1973 and produces more than 280 frozen treats.
The cones will come out of a 216,000-square-foot plant in Dunnville, Ont., that Original Foods bought from Smucker’s in 2013. Original Foods president Steeve Tremblay did not respond to a message Thursday.
“Because of Trump’s tariffs and because of the threats against Canadian sovereignty just in general, a lot of Canadian companies and manufacturers are starting to look at things that they never would have considered before,” Chapman said.
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