With the clock ticking for Canada to finalize a trade agreement with the United States, many Canadian businesses are feeling anxious, anticipating a potential significant drop in sales if the new tariffs are imposed. The upcoming U.S. tariffs, scheduled to come into effect on Wednesday, would impact a wide range of Canadian products, including electronics, dairy, alcohol, and wood, among others, totaling $28 billion in value.
Negotiations are reaching a critical stage, with Canadian officials likely to meet with U.S. Trade Representative Jamieson Greer before Prime Minister Mark Carney and U.S. President Donald Trump discuss the situation prior to the tariff deadline. The final decision on any deal rests with President Trump, as emphasized by America’s chief trade negotiator.
For certain Canadian enterprises, the proposed tariffs pose a dual threat of not only raising prices for American customers but also rendering cross-border shipping economically unfeasible. Todd Stafford, president of Northern Cables based in Brockville, Ontario, expressed concern as half of the company’s sales depend on U.S. buyers. The company specializes in manufacturing copper and aluminum power cables for commercial and industrial applications.
Should the new tariffs be enforced, Northern Cables would face severe repercussions, potentially halting all border-crossing shipments. Stafford remains hopeful for a favorable resolution or a potential extension of time to mitigate the impact. Despite managing to avoid layoffs for over two decades, Stafford fears the tariffs could exacerbate existing challenges such as a slowdown in condo construction and competition from lower-priced Chinese goods.
The Canada-U.S.-Mexico Agreement (CUSMA) has shielded a significant portion of cross-border trade from tariffs since its formalization by President Trump in 2020. However, the impending tariffs would affect around five percent of Canada’s total trade with the U.S., encompassing various Canadian exports like hockey sticks, specific flowers, and antiques. Notably, energy, potash, and critical minerals are anticipated to remain exempt from the new tariffs.
Business owners, already grappling with uncertainties, are apprehensive about the potential impact of the new tariffs. Cindy Baldassi, owner of CindyLouWho2, a Calgary-based jewelry business, expressed worries about potentially losing half of her business due to the tariffs. Despite redirecting focus to domestic markets and temporarily halting U.S. shipments, Baldassi foresees challenges in sustaining her one-person enterprise without the CUSMA compliance advantage.
Amid concerns about the reliability of the U.S. as a trade partner, some Canadian businesses have already felt the repercussions of the tariff threats. Randy Williams from Monterey Textiles highlighted the adverse effects on the textile industry, with layoffs, reduced orders, and customer searches for alternative suppliers already underway due to the looming tariffs.
In Alberta, beekeeper Lorne Prins of Gull Lake Honey shared concerns about the potential surplus of honey in Canada if new tariffs impede U.S. sales for other producers. Prins emphasized the importance of supporting local businesses through initiatives like Buy Canadian to mitigate the impact of the tariffs on the honey industry.