A cow looks on as it feeds in a dairy farm in Saguenay, Que., on Jan. 23, 2024.Jacques Boissinot/The Canadian Press
U.S. President Donald Trump said his administration will place tariffs imminently on Canadian lumber and dairy products after complaining about long-standing grievances in those sectors, the latest provocations in the U.S.-led trade war.
Speaking to reporters in the Oval Office on Friday, Mr. Trump said the United States could impose levies on lumber and dairy that day, “or we’ll wait till Monday or Tuesday.” The White House had previously said it would impose reciprocal tariffs April 2 on countries that stymie trade with the U.S., whether through levies of their own or other perceived trade barriers.
“Canada has been ripping us off for years on tariffs for lumber and for dairy products,” Mr. Trump said on Friday.
“They’ll be met with the exact same tariff unless they drop it, and that’s what reciprocal means.”
The latest U.S. tariff threats underscore the continuing uncertainty in Canada’s trading relationship with its southern neighbour as Mr. Trump’s complaints evolve daily, with dairy and lumber being two areas of focus for him. Earlier this week, the Trump White House launched a trade war against Canada and Mexico through debilitating tariffs that, by Thursday, had been partly put on pause, creating loads of uncertainty for policy makers, business leaders and investors.
Canada imposes high tariffs on dairy imports that exceed a certain quota level for trading partners. The Trump administration has complained that Canada’s agricultural supply management system is unfair to American dairy farmers.
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However, U.S. tariffs are unlikely to have a major impact on the Canadian dairy sector. Canada is not a major dairy exporter because its supply management system is designed to meet domestic demand with production quotas. Canadian dairy exports to all countries amounted to almost $500-million in 2023, a small fraction of total output.
Meanwhile, Canada is the second-largest market for U.S. dairy exports, which were valued at US$1.14-billion in 2024.
However, French-style goat cheese from Quebec is important to the U.S. artisanal cheese market, said Andrea Berti, president of the Cheese Importers Association of America. The U.S. market – largely focused on commodity cheese styles such as cheddar and Swiss – does not have much domestic production of these specialty cheeses.
“Canadian cheese is complementary to the U.S. cheese,” said Mr. Berti. “It is not replaceable.”
As for lumber, the U.S. has long alleged the Canadian lumber industry is government-subsidized because the “stumpage fees” paid to provincial governments for the right to log are too low.
Mr. Trump paused tariffs on Thursday until April 2 on goods coming from Canada and Mexico that are compliant with the North American trade agreement, covering a substantial portion of continental trade.
In response, Finance Minister Dominic LeBlanc said Canada would not proceed with a second tranche of tariffs on $125-billion of U.S. goods imports for now. The federal government will keep 25-per-cent tariffs in place on $30-billion worth of goods, which includes wood products.
Softwood production from U.S. sawmills accounts for about 70 per cent of American domestic consumption, with Canadian lumber contributing 24 per cent and the rest from foreign suppliers, mostly from Europe.
Of the lumber output within the United States, less than 1 per cent is shipped north of border, according to data from Canada’s forestry sector.
U.S. President Donald Trump listens to his national security adviser Mike Waltz, centre, as he speaks from the Oval Office on Friday. Mr. Trump says tariffs could be imposed on Canadian dairy and lumber products within days.JIM WATSON/AFP/Getty Images
“Canada is mostly an exporter of softwood lumber. There’s very little volume that we import,” Kurt Niquidet, president of the BC Lumber Trade Council, said in an interview.
Mr. Niquidet said he isn’t aware of any long-standing Canadian tariffs on U.S.-produced softwood lumber, but the U.S. Department of Commerce imposes duties on softwood at a current rate of 14.4 per cent levied against most Canadian producers.
Mr. Trump also has ordered a new investigation into softwood lumber trade that is global in scope. He signed two executive orders on March 1.
One order launches an investigation that could result in new tariffs globally, including against Canada, on softwood shipments into the U.S.
The other order is designed to spur lumber production within the U.S. The probe into global lumber trade is scheduled to be completed by the end of 2025.
Ottawa announced on Friday a package of support programs aimed at Canadian businesses and workers in response to the tariffs Mr. Trump has imposed and threatened. The package includes the launch of the $5-billion Trade Impact Program to help exporters reach new markets.
With reports from Bill Curry and Kate Helmore
What questions do you have about tariffs?
The tariffs announced by U.S. President Donald Trump have upended decades of free trade in North America, causing chaos on both sides of the border.
Alongside the chaos come many questions about how this will affect Canadians' lives, and Globe reporters are here to help you navigate those. Perhaps you're curious about how this might impact the sector you work in, or maybe you'd like to know what this means for your mortgage. Tell us what you want to know about these new levies, and we'll do our best to answer. Please submit your questions below or send an email to audience@globeandmail.com with "Tariff Question" in the subject line.