5 Goods We Buy From Canada That Would Be Affected By Trump's Proposed Tariffs

The threat of heightened tariffs against top U.S. trade partners like Canada are looming along with Inauguration Day. Average Americans are suddenly finding themselves forced to become experts on increased customs costs and how new tariffs will affect their family's budget. President-elect Donald Trump's hardline on heavy tariffs has been clear throughout the first term of his presidency, and a rhetorical rallying cry for his recent campaign. Now, Trump's rhetoric is quickly approaching reality. Even in the few months leading up to his presidential second term (and sentencing), Trump has insisted he will levy 10% additional tariffs against China, and 25% tariffs against Mexico and Canada, and vowed to sign all necessary paperwork to do so in a November 25 Truth Social post.

Part of Trump's rationale, per the post, is to use heavy tariffs to force trade partners to play ball with his own administration's agenda surrounding closing borders. Per a 2018 X (then Twitter) post where he proclaimed himself a "Tariff Man," Trump also seems to believe tariffs will make America rich. Of course, increased tariffs actually mean increased costs for all Americans on impacted imported goods and components. Spiked prices will be apparent on a variety of U.S. imports from Canada, one of the country's most interdependent trade partners.

Canada is one of the top crude oil producers in the world, and the U.S. is highly reliant on its supply to maintain affordable gas prices. About 60% of crude oil imported to the U.S. comes from Canada, per data and analysis from the U.S. Energy and Information Administration. In October 2024 alone, 80% of crude oil imported to the U.S. came from the Canadian supply, at a rate of 4 million barrels of crude oil being imported per day.

About 20% of all crude oil used in the U.S. comes from Canada. Canada's heavy crude, largely from Alberta, is imported to U.S. refineries through pipelines that largely benefit the more landlocked midwestern section of the United Sates, which doesn't benefit as much as the coasts from coast-imported crude. These refineries process crude into fuel. All to say, imported heavy crude under heavy tariffs will create a spike in prices at the pump, especially for residents of the Great Lakes, Rockies, and Midwest regions.

In a November 2024 interview on The Chad Hartman Show, Patrick De Haan, oil analyst for GasBuddy.com, told WCCO's Chad Hartman, "If the tariff hits it's going to hit you and I to the tune of 35-75 cents each time we fill our tank."

Crude oil, petroleum, and petroleum products comprise a major amount of Canadian exports. Just as U.S. fuel prices will be affected by Donald Trump's tariffs on these products, natural gas and energy costs will also rise under increased import taxes.

While the U.S. was once Canada's only natural gas export market, today the U.S. and Canada directly compete. Still, in 2023, 45% of Canada's natural gas was supplied to the U.S. About 99% of U.S. natural gas imports come from Canada, which means any Canadian natural gas still imported after tariffs are applied will see prices affected for end consumers.

Canadian leadership don't take the prospect of tariffs knocking them out of the fuel and energy export game lightly. While some pundits have wagered that Trump will exempt fuel and energy imports from tariffs, Ottawa premier Doug Ford has already threatened retaliatory tariffs and energy throttles if Trump makes good on tariff threats. Electricity supply hangs in the balance for Michigan, New York, and Minnesota, especially. A lack of energy options available in these areas of the domestic U.S. could also lead to possibly extortionate, monopoly-like pricing for remaining available provided.

Cars might suffer serious price hikes if Trump's proposed tariffs take hold. Cars with lower price points tend to be manufactured and assembled in Mexico and Canada. The U.S. depends on the manufacture of entire cars and even just automotive components from sensors to steering wheels, all imported from our physical neighbors to the north and south.

Because of the complicated, interdependent nature of car manufacturing, automakers and parts providers may hedge their bets by making less cars in higher-tariff times. Auto shoppers may have to pay higher prices for less options. Automotive jobs in Canada and the U.S. will also likely suffer, especially since it isn't likely that automotive manufacturing centers will shift operations to the U.S.

Unfortunately, budget-priced cars like the Canadian-made Honda Civic may be most affected by tariffs, and could see price spikes up about $3,000. This spike would come from automakers and parts suppliers passing on their own tariff costs to their consumers, and could impact jobs.

Canada is the fourth-largest aluminum producer in the world, and exported 74.25% of the U.S.'s raw aluminum supply in 2023. Plenty of U.S. manufacturers rely on Canadian aluminum to make their own domestic goods, and an increased tariff on imported raw metal materials will impact end product costs. Canadian aluminum and steel exported to the U.S. may ultimately be exempted from additional tariffs, thus bypassing major manufacturing issues.

However, if exemptions are not made, major domestic (and global) industries and product prices are at stake. "Open, tariff-free aluminum trade with Canada has underpinned much of the more than $10 billion in domestic investment the industry has made over the past decade," Charles Johnson, Aluminum Association president, told trade publication, Fastmarkets, in November 2024. Johnson added: "The US industry must source about two-thirds of the primary aluminum it uses every year from Canada, since all domestic smelters, even running at full capacity, cannot produce nearly enough metal to meet demand."

Since aluminum is used in such a wide range of products, consumers could feel the burn on increased prices from drinks and soups packaged in aluminum cans to cars and truck parts reliant on the material.

Canada is one of the top-five suppliers of pharmaceutical goods to the U.S. Generic drugs imported from Canada reduce costs for Americans, and the process also has FDA guidance and regulation. Since most prescriptions in the U.S. rely on the provision of lower-cost, generic supply, tariffs may prove especially disruptive when applied to imported pharmaceuticals from Canada and other trade partners.

25% additional tariffs can wreak havoc on already-thin generic drug profit margins. Increased manufacturing costs may erase profit potential, and outright cease production, leading to drug shortages and increased prices. Drug manufacturers and wholesalers may respond to increased tariffs with less choice, and higher prices on those choices. Not only could this be economically devastating, but could also become a matter of life and death, depending on conditions medication is needed for.

The prospect of these tariffs are alarming. While your initial impulse might be to stock up on certain items and services before tariffs take affect, or simply wail in despair, remember to take a breath and keep a cool head. Uncertainty and anxiety is at an all-time high surrounding these potential price increases. Whipping yourself into a frenzy won't save you any sanity now, nor any money. Prescriptions may be wiser to stock up on than ten thousand packages of toilet paper, for example. Be as smart and frugal as you can be about how you spend your pennies and what you spend them on, now and after a potential (pricey) sea change.