The United States implemented 50% tariffs on approximately $20 billion of Canadian goods on Saturday, following the collapse of trade negotiations earlier in the week.
The duties apply to hundreds of products including plywood, alcoholic beverages, electrical equipment and hockey gear, citing a rarely used provision of the Tariff Act of 1930. The measure permits Washington to impose duties against countries deemed to discriminate against U.S. commerce. Major Canadian natural-resource exports—crude oil, potash and critical minerals—were excluded from the tariffs.
Canada supplies the United States with more than 4 million barrels per day of crude oil and petroleum products, underscoring the exclusion’s significance for energy markets.
Trade talks had appeared to reach a breakthrough on Tuesday when President Donald Trump announced a deal less than two hours before the initially scheduled tariff deadline. Canadian officials flagged unresolved issues, prompting a three-day extension. Negotiations ultimately failed, and the tariffs took effect on Saturday.
Under the draft agreement discussed earlier in the week, the U.S. would have reduced tariffs on some Canadian steel and aluminum products to 25% from 50%, and lowered duties on Canadian automobiles to 15%. Canada had also agreed to remove retaliatory measures imposed last year, including tariffs on U.S. vehicles. Washington sought the removal of provincial restrictions on retail sales of American alcoholic beverages.
Canada exchanged nearly $900 billion in goods and services with the U.S. last year, making it the largest trading relationship for both nations. Canadian Prime Minister Mark Carney stated that Ottawa would respond “dollar for dollar” to protect domestic workers and businesses. He criticized Washington for making last-minute changes that he described as “unfair, economically damaging and raised doubts about the reliability of any agreement.” Carney ruled out restricting natural-resource shipments, emphasizing Canada’s role as a reliable supplier.
U.S. Trade Representative Jamieson Greer attributed the collapse to new Canadian demands and reversals of earlier commitments, which disrupted the balance reached during several days of negotiations.
