Some analysts argued on Tuesday, 21 July ’26, that U.S. President Donald Trump’s latest escalation of his tariff campaign against Canada was narrowly focused. It appears designed to give the U.S. more leverage in upcoming trade talks.
Trump signed a series of executive orders on Monday, 20 July ’26, that may impose a 50% tariff on a range of goods. This includes honey, liquor, and cement besides hockey sticks.
Energy, potash, critical minerals, and fish, besides goods already targeted by the U.S. for Section 232 tariffs, aren’t affected by the latest duties.
There may be no excuses for good compliance with the Canada-U.S.-Mexico (CUSMA) agreement on trade. It has served as a shield for Canadian exporters in previous rounds of tariffs.
Head of macro strategy at Desjardins, Royce Mendes, said that removing that exemption represents a marked escalation in U.S. trade aggression.
Mendes noted that the coverage is certainly not broad-based in nature. Instead, it’s more targeted.
Several economists, including Mendes, suggested that the new duties may hit around 5% of Canada’s exports to the U.S.
BMO senior economist Robert Kavcic said in a note to clients that the proposed tariffs may cover roughly USD 19.88 (CAD 28) billion worth of annual Canadian exports to the U.S., which amounts to 0.8% of Canada’s gross domestic product.
Kavcic opined that chemicals, plastics, and electronics, besides industrial equipment, are the largest targets. These consumer goods and forestry products follow closely behind. Consumer goods and forestry products follow closely behind. Miscellaneous manufacturing machinery besides agricultural or food products round out the list.
Mendes asserted that areas previously targeted in Trump’s tariff agenda may see more pressure in the latest round of duties. That may mean that already hard-hit provinces like Ontario will see steeper impacts.
The Trump administration has cited Canada’s supply-managed diary industry. Also, provincial bans on U.S. booze besides quotas on the American automotive sector, justify the new tariffs.
