Publisher: Running Post
Author: Abdul Jabbar
The threat of a tariff war between the United States and Canada has mounted as U.S. President Donald Trump threatened to impose tariffs on Canadian imports by next week, which sent alarms about a trade war that Canada might initiate retaliatory action on.
“If the president does decide to move ahead with tariffs on Canada, Canada will respond, and everything is on the table,” Canadian Prime Minister Justin Trudeau declared at a news conference in Montebello, Quebec, where his cabinet gathered for a strategic retreat. Trudeau emphasized that any counter-tariffs from Canada would be designed to match Trump’s proposed 25% tariff on Canadian goods dollar for dollar.
The Retail Council of Canada says such retaliatory tariffs could have the effect of driving up the price for both sides of the border. “When tariffs are imposed, it’s often the buyer who winds up paying it, and that ultimately is a cost to the consumer,” vice-president Matt Poirier says.
Here are 10 product categories that are likely to have price increases:
Cereals: The U.S. is one of the biggest exporters of cereal to Canada, accounting for about $2.8 billion annually. A tariff would affect the supermarket shelf and make breakfasts more expensive for Canadians.
Cosmetics and Soap: Over $1.19 billion in beauty and personal care products is imported into Canada annually from the U.S. A tariff on these goods will make makeup, soap, and all other related items costlier.
Fruit Juice:
Orange juice is one of the main products exported by Florida. Canada could target this state in its retaliatory tariffs. Fruit juice imported from the U.S. into Canada was valued at $385 million in 2022. This breakfast staple may experience a price increase.
Alcoholic Beverages:
Kentucky bourbon, California wine, and other American-made alcoholic beverages might be denied greater access or levied a higher tariff. Even Ontario Premier Doug Ford hinted at pulling American booze off the shelves to nudge consumers to more local imbibing choices.
Cars and Auto Parts:
Given the two countries’ interconnectedness in auto production, any form of U.S. tariff on Canadian car imports could quickly shut down production lines, meaning increased car prices for both countries.
Canada relies heavily on the U.S. for produce like lettuce, melons, and nuts, with annual agricultural imports exceeding $20 billion. Tariffs would add inflationary pressure to already costly grocery bills.
Seafood:
Canada imports $1.4 billion worth of seafood annually from the U.S., including salmon and lobster. Tariffs on these products could significantly increase their prices.
Clothing and Footwear:
The U.S. is one of the major suppliers of textiles, apparel, and footwear to Canada. This means that your spring wardrobe shopping may be costlier due to tariffs on these products.
Flowers:
Valentine’s Day may also suffer as Canada imports millions of kilograms of fresh flowers from the U.S. every year. The price of roses and other bouquets will rise.
Chocolates and Confectionery:
U.S. chocolate exports to Canada have been rising in recent years, to the tune of $878 million. Tariffs on these sweet treats would dampen celebrations for many Canadians.
Experts suggest that the effect of a tariff battle will be far-reaching beyond the product, and can affect industries and jobs on both sides of the border. Jean Simard, president of the Aluminum Association of Canada, said the economies of the two nations are very interdependent and most products cross the border several times during production.
Preparation for Economic War
For the days ahead as the two nations wage a potential economic war, consumers can gear up for higher prices and compromised trade relations.
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