U.S. Tariffs: Turning Leverage into a Proudly Canadian Advantage (Category: Economy)
- Nicholas Gagnon
- 8 minutes ago
- 3 min read
Canada’s total goods exports to the United States amount to approximately US$420 billion (2024, all merchandise), excluding services.
The table below provides a structured overview of key export categories. This selection represents 75% of total exports, or about US$310 billion.
Exports Canada to the USA | Trade value (2024) | Tariffs (2025) | Code | |
Minerals, Metals & Forest Products (HS Chapters) |
|
|
| |
Mineral fuels, oils, natural gas, electricity (HS 27) | US$125.7B | 10% |
| |
Wood & wood products (HS 44) | US$11.2B | 10-25% |
| |
Aluminum (HS 76) | US$11.2B | 25% |
| |
Iron & steel (HS 72–73) | US$7.6B | 25% |
| |
Inorganic chemicals (HS 28) | US$4.3B | CUSMA |
| |
Copper (HS 74) | US$3.9B | CUSMA |
| |
Fertilizers (HS 31) | US$3.8B | CUSMA |
| |
Organic chemicals (HS 29) | US$3.1B | CUSMA |
| |
Nickel (HS 75) | US$1.0B | CUSMA |
| |
Manufactured Goods (HS Chapters) |
|
|
| |
Vehicles (HS 87) | US$51.0B | 25% / CUSMA |
| |
Machinery, nuclear reactors, boilers (HS 84) | US$31.2B | CUSMA |
| |
Plastics (HS 39) | US$14.1B | CUSMA |
| |
Electrical equipment (HS 85) | US$13.2B | CUSMA |
| |
US$7.7B | CUSMA |
| ||
Paper & pulp products (HS 48) | US$6.7B | CUSMA |
|
CUSMA – Compliant with the Canada–United States–Mexico Agreement (CUSMA), with 0% tariffs until the agreement’s renegotiation in 2026.
The green colour-coded categories in the table highlight areas where Canada can build meaningful leverage and shape a coherent negotiation narrative with the U.S. administration ahead of the 2026 CUSMA renegotiation.
Energy
The U.S. administration currently projects an image of energy self-sufficiency, supported by abundant fracking output and recent geopolitical developments in Venezuela. This perception may persist for some time. The U.S. has imposed a 10% tariff on this category, despite the fact that Canada has historically provided a 15–20% discount on crude exports.
Canada’s proximity advantages—Alberta’s oil sands, secure supplies of crude and natural gas, and a deeply interconnected electricity grid—remain powerful strategic assets. With the Trans Mountain pipeline coming online and the potential for additional westbound capacity in the future, Canada is increasingly positioned to diversify its customer base and secure fair‑market pricing in Asian markets.
Metals and Inorganic Materials
Although current U.S. tariffs on aluminum are painful, Canada’s natural resources and processing capabilities in aluminum, copper, nickel, and inorganic materials remain indispensable to the U.S. automotive, machinery, aerospace, and defence sectors. Supply chains have not yet shown visible disruption, but that stability is not guaranteed. Should the U.S. maintain a rigid tariff posture, Canada has alternative global customers. Canada’s leadership understands this dynamic well, and it strengthens our negotiating position.
Fertilizers and Pulp Products
These two categories illustrate that supply‑chain vulnerability does not always stem from high-tech goods.
Fertilizers: The U.S. is a major producer of vegetables, corn, and fruit crops that depend heavily on fertilizer. Canada holds the world’s largest potash reserves, primarily in Saskatchewan, making it the leading global producer of this essential input for global food security. While potash is also found in Belarus, Russia, and to a limited extent in the U.S., America is not self-sufficient. Meanwhile, demand in Brazil, Europe, and other regions remains strong. If the U.S. chooses to escalate trade pressure, Canada has room to respond.
Pulp Products: Pulp is critical for producing corrugated boxes—the backbone of Amazon’s logistics and the broader e-commerce ecosystem. For now, just-in-time production remains stable, but corrugating machines cannot be idled without major consequences. A disruption in pulp supply would quickly cascade into packaging shortages, with significant economic impact. The toilet‑paper panic of the pandemic would look mild by comparison.
A Closing Thought
My intention is not to see hardship for anyone south of the border. What I hope for is mutual respect and a healthy neighbourhood—one grounded in a genuine win-win mindset. Unfortunately, that mindset can be elusive for some, and that is regrettable.
Feedback or ideas? Drop me a line: nicholas@aheadcurve.co