U.S. President Donald Trump announced on Friday that his administration may soon impose reciprocal tariffs on Canadian dairy and lumber products, accusing Canada of charging excessively high tariffs on these goods. Speaking in the Oval Office, Trump criticized Canada’s 250% tariff on dairy and “tremendously high” lumber tariffs, stating that such practices have disadvantaged U.S. producers for years. He indicated that reciprocal tariffs could be implemented as early as this week unless Canada lowers its rates.
Trump’s remarks are part of his broader trade pressure campaign against Canada, which he claims has unfairly benefited from the U.S. market and failed to curb the flow of fentanyl across the border. While most trade between the U.S., Canada, and Mexico remains duty-free under the U.S.-Mexico-Canada Agreement (USMCA), Canada’s dairy tariffs, part of its Supply Management system, have long been a point of contention. The USMCA allows limited duty-free dairy quotas, but tariffs on excess imports can exceed 200%.
The U.S. already imposes combined anti-dumping and anti-subsidy duties of about 14.5% on Canadian softwood lumber. Trump recently ordered a national security probe into global lumber imports, which could further increase tariffs. Last week, he suspended 25% tariffs on most Canadian and Mexican goods for 30 days, a move that would have raised lumber tariffs to nearly 40% and significantly increased homebuilding costs.
In a Fox Business Network interview, Trump described the 30-day tariff suspension as a temporary measure to assist automakers, warning that tariffs could rise again after April 2, when reciprocal tariffs are set to take effect. “What they charge us, we charge them. It’s a big deal,” Trump said, emphasizing his goal of equalizing trade terms.
White House trade adviser Peter Navarro explained that the reciprocal tariff plan would address both tariff and non-tariff barriers, with adjustments based on industry-specific and country-specific investigations. However, Trump acknowledged that tariff rates could fluctuate, stating, “The terms could go up as time goes by.”
Canada’s Industry Minister, Francois-Philippe Champagne, expressed frustration over the shifting U.S. trade policies, stating, “It seems that the goal posts keep moving, and that’s what makes it difficult.” He called for a return to normalcy in U.S.-Canada trade relations.
Meanwhile, the U.S. is set to increase tariffs on steel and aluminum imports next week, rescinding exemptions and raising aluminum duties to 25%. This move will impact hundreds of downstream products and further strain trade relations with Canada and Mexico, the largest suppliers of these metals to the U.S.