Canada Suffers Under Trump Tariffs Rooted in Longstanding Trade Imbalances

Clear Facts

• U.S. tariffs on roughly $20 billion in Canadian goods remain in place, sharply reducing steel and lumber exports.
• Canadian consumer prices rose 3% in August, with grocery prices up 2.8% and transportation costs jumping 7.5%.
• More than 99% of U.S.-Canada trade was duty-free before 2025, though Canada maintains high tariffs on dairy, poultry and eggs.

President Donald Trump’s tariffs on Canadian steel, aluminum, lumber and automobiles are delivering measurable economic pressure north of the border. Steel exports have fallen by roughly half since the duties took effect, while lumber shipments dropped about 20% below 2024 levels earlier this year. Production and employment in those sectors have declined accordingly.

Canadian households are absorbing higher costs at the checkout and the pump. Consumer prices climbed 3% year-over-year in August, grocery prices rose 2.8%, and transportation expenses surged 7.5% according to Statistics Canada. Retaliatory duties on American goods have compounded the increases.

Prices of tariff-affected items—groceries, household products, furniture, electronics and appliances—rose roughly 6% more than comparable untariffed goods, according to Bank of Canada analysis.

David Clement, North American affairs manager at the Consumer Choice Center, placed the dairy dispute in context.

“The Trump administration is complaining about dairy access and, generally speaking, those complaints are completely valid,” Clement told Fox News Digital.

“Canada has exorbitant tariffs on imports from the United States and really from everywhere around the world when it comes to chicken, turkey, eggs, cheese and milk,” he added.

Scott Lincicome of the Cato Institute noted the broader trade relationship once operated with minimal friction.

“More than 99% of U.S.-Canada trade was duty-free before 2025,” Lincicome said.

Lincicome warned that recent energy-price spikes from the Iran conflict are magnifying the tariff effects.

“First you had the tariffs which increased the prices of a lot of products. And then you had energy prices spike because of the Iran war,” he said.

He described the combined pressures as a “double whammy” that functions like an additional tariff on American and Canadian consumers alike.

Clement urged both nations to preserve the historic trading partnership.

“The partnership between Canada and the United States is one of the greatest trading relationships the world has ever known,” he said. “That should be embraced. It should be enhanced, and it shouldn’t be torn down by either side.”

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