U-S tariffs on steel and aluminium are a troubling development for some local farm implement manufacturers.

Virtually every piece of equipment for grain bins, farm machinery, and livestock handling has steel or aluminium in it. Those metals are going to cost more to import into this country starting July 1st when Canada's retaliatory tariffs take effect.

Elmer's Manufacturing, located in Rhineland Municipality, manufactures specialized agricultural equipment and uses those metals in its products. General manager Mike Friesen says the tariffs will eventually have an impact on their products.

"It's a tough spot to be in. It's a fact that the material costs are a big part of our pricing and we have to adjust that pricing accordingly. Typically we have a decent amount of stock on hand for at least two months and we can get by with that. However, as time goes on we'll be forced to raise prices for our products."

Some of the products made by Elmer's Manufacturing are exported to customers in the U.S.

"The supply-chain is extremely integrated as many Canadian firms import metal from the U.S. that they later re-export to the U.S. as a finished product," Leah Olson, president of the Agricultural Manufacturers of Canada, says.

Canada exported about $1.9 billion worth of agricultural equipment to 150 countries last year, with as much as 80 per cent going to the U.S.

"A lot of our products still contain Canadian steel and aluminium, so as long as there is no supply and demand effect on those metals, we'll be OK. But there is still the question of whether we're going to be able to source all the materials we need from Canada or other places that don't have tariffs," says Friesen.

Elmer's Manufacturing has enjoyed steady growth over the past number of years by expanding its product lines and markets and now employs just over 100 employees.

Friesen notes growth could be stunted if the company is forced to increase its prices.

Nonetheless, he is confident they can still remain competitive in the North American market.

"As long as everyone is on the same playing field, then we will continue to be competitive. If that playing field becomes lopsided, then we're going to be in trouble."