Trade tensions play out in a U.S.-Canada border town
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The future of trading is fast, powerful, and precise. Experience it now on Robinhood Legend. Sign up today. Investing is risky. Robinhood Financial LLC, member SIPC, is a registered broker-dealer. Other fees may apply. Amid trade tensions, what happens when Minnesota Nice meets Ontario Nice?

I'm David Brancaccio in Los Angeles. First, farmers are struggling to pay their debts. This is clear from an analysis by Bloomberg Law of bankruptcy filings. And this is before the new higher tariffs started to kick in. Marketplace's Savannah Peters reports.

Bloomberg found farm bankruptcies were up 55 percent in 2024, and they're trending even higher this year. That tracks with what bankruptcy attorney Don Swanson is seeing. In fact, I've got a chapter 12 going right now. That's the section of the bankruptcy code for farmers. And Swanson says his firm, Coley Jessen in Omaha, has a few more of those cases in the works.

Every debtor has their own issues that are unique to them. But 2024 was a terrible year for farming. Farmers have been dealing with high input costs and low crop prices. And if all the proposed tariffs go through... That negative pressure is just going to intensify. Rabel Chandio is a professor of agricultural economics at Iowa State University. She says whether farm bankruptcy rates rise even faster depends on how long steep tariffs on China last.

And whether the Trump administration offers relief payments to cover affected farmers' losses, like it did during the last trade war. I'm Savannah Peters for Marketplace. Markets, it has been three up days in a row for the S&P 500 stock index. S&P futures are down a quarter percent now. NASDAQ futures also just turned down two-tenths percent. The S&P is down 2.2 percent in April so far. The Dow is down four and a half percent month so far.

A published report says Apple is moving to produce all the iPhones sold in the U.S. in India, a pivot away from China. Remember, it says designed by Apple in California, doesn't say made. The Financial Times has the India scoop today.

Now to video gaming. It was delayed for several weeks because of the Trump administration's tariff announcements, but overnight, retailers started taking pre-orders for the Nintendo Switch 2 console. Walmart, Best Buy, and others that are part of this rollout report major demand. The boxes are set to start selling in earnest on June the 5th. You say Legend of Zelda, Tears of the Kingdom. I say Animal Crossing New Horizons. ♪

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Now to the nexus of the U.S. and Canada at a time of fraught trade relations. Marketplace's senior economics contributor, Chris Farrell, forded the chasm between Minnesota, USA, and Ontario, Canada, to the Canadian border town of Thunder Bay. Hi, Chris. David. So you get just across the border to Canada. Did you get the stink eye, Mr. U.S. citizen? No.

People were incredibly nice, David. I just have to emphasize that. You know, Thunder Bay, it's this port city. It's a railway hub. People from Thunder Bay, they cross over into Minnesota, northern Minnesota. And people in northern Minnesota, they go do their shopping in Thunder Bay.

We have a lot of sort of back and forth, you know, whether it's business or whether it's individuals, you know, just going to Grand Marais for the weekend, those kinds of things, going to Duluth, that back and forth activity, hockey teams, soccer teams, etc.

Charlotte Robinson is president of the Thunder Bay Chamber of Commerce, and as you could hear, we met in a diner. Certainly from a business perspective, it's also been a close relationship. We do a fair bit of trade between some of our larger industries, with Minnesota specifically.

She said it's been a close relationship, but now with President Trump's tariffs, 25 percent on a lot of things, 10 percent on some energy products and Canada responding. What's it now? I don't know. Testy, this relationship? You know, the word that we heard a lot, David, is betrayal. You know, they're unhappy with Trump's insistence that Canada should become the 51st state. And the way they're expressing their displeasure is with their wallets.

Cross-border travel is down. Vacation plans to the U.S. are canceled. American liquor, wine, and beer, it's been pulled off the shelves in Thunder Bay in Ottawa. And Livio De Matteo, he's an economics professor at Lakehead University in Thunder Bay, notes that even grocery store aisles have changed. We found oranges from Morocco and Egypt.

We've never really seen that before. So even the retailers are already making the effort. You know, the broccoli has been coming from Mexico, we've noticed. Blueberries from Peru. All right. So some agility there. But can the Canadian economy decouple itself from the U.S.? 30% of Canada's economy is export-oriented, and three-quarters of its exports go to the U.S. But it's not just the U.S.

In the interviews we had, David, Canadian business owners seem determined to reduce their reliance on the U.S. They're creating stronger business ties within Canada, and they're forging direct economic relations with other countries. So James Foltz, he's the founder of Border Giant, is based in Thunder Bay, and the company's software smooths cross-border transactions for small businesses and individuals. Pretty much every business right across Canada, they're going to start looking for

at other options in the supply chain rather than USA, even for distributors and everything. So between the pricing going up and the uncertainty and even the emotional response to the rhetoric with the 51st state and everything like that is okay.

There's really not a path forward. So we need to cut out like the ties as best we can and move on to a more certain path. Chris, once trust goes away, not easy to get back. No, it isn't. And, you know, trust isn't easy to measure like land or capital. It's more like a recipe that allows for all kinds of economic activity and innovation. Again, James Folds.

Once that trust is broken and you have to go somewhere else, you've done the work to look for something else. You've formed another relationship and you don't tend to go back to that. No one knows how deep the rupture between the two economies is, but Canadian entrepreneurs and businesses, they aren't waiting to find out. They're acting now. Marketplace's senior economics contributor, Chris Farrell, back in Minnesota after a reporting trip to Thunder Bay, Ontario. Chris, thank you very much. Thanks a lot.

And I'll have the global investment management firm with Provolone, Banana Peppers, private equity and a hedge fund. Did you know Blackstone Group now owns Jersey Mike's subs? Taste the portfolio at every bite. There's news the founder of Jersey Mike's, Peter, not Mike, Peter Cancro, is leaving the CEO position now that it's Blackstone. A guy also not named Mike from Wingstop Chicken Wings now takes over.

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