With only hours to spare for Canada to strike a trade deal with the United States, a wide swath of Canadian businesses are on edge — with some expecting as much as half of their sales could disappear if the punishing new levies take hold.
The latest round of U.S. tariffs are set to take effect Wednesday unless a last-minute deal is reached. They would layer on top of existing U.S. trade sanctions, adding another duty to $28-billion worth of Canadian products including electronics, dairy, alcohol, wood and more.
For some Canadian businesses, their products wouldn’t just become more expensive for American customers. Instead, the price would be so high their products would never even make it across the border, some business owners say.
Todd Stafford, president of Brockville, Ont.-based Northern Cables, says his company counts on U.S. buyers for about half of its sales. The company manufactures copper and aluminum power cables for commercial and industrial use.
Sources tell CBC News that Canadian negotiators fear looming new U.S. tariffs may be unavoidable as Washington continues to demand an end to provincial bans on U.S. alcohol — which provinces refuse to do. Canada’s push for greater tariff relief on key sectors like lumber is also stalled.
“We ship 50 per cent of our production to the U.S. We have seven warehouses in the U.S.,” he told CBC News on Monday. “At the announced level of 50 per cent tariffs, we would lose all of that business immediately.”
Stafford says if the new U.S. tariffs kick in on Wednesday, “we can’t have a single tractor-trailer cross the border.
“We’re hoping cooler heads prevail, or maybe there’ll be some kind of time extension,” he added.
The company, which has 320 employees in Brockville, has avoided layoffs for the last 26 years. Stafford said he worries the tariffs will compound problems at home, like slowing condo construction and competition from cheaper Chinese-made products.
“We wouldn’t [lose] 50 per cent of the people,” he said. “But it would be very close to that.”
Shield of CUSMA won’t apply
From auto parts to lumber, steel and aluminum, U.S. President Donald Trump has targeted key sectors of Canada’s economy since his second term started in January 2025.
However, the vast majority of cross-border trade has been exempt under the Canada-U.S.-Mexico Agreement (CUSMA), a trade deal Trump formally signed in 2020. This has significantly blunted the trade war’s impact on Canada’s economy.
The new tariffs set to take effect on Wednesday would change that, impacting about five per cent of the overall trade Canada does with the U.S. The list of affected Canadian exports is long, including items like hockey sticks, certain flowers and antiques.
Energy, potash and critical minerals are set to remain exempt.
“To say business owners are afraid is an understatement,” Canadian Federation of Independent Business (CFIB) vice-president of national affairs Jasmin Guénette said on Monday. “You cannot lose 50 per cent of your revenue without feeling the impact.”
“CUSMA has been providing a shield for many sectors and many businesses,” Guénette added.
Cindy Baldassi runs a Calgary-based company called CindyLouWho2 that sells handmade jewelry. Baldassi said she is worried she might lose half of her business.
“I have now shut down U.S. shipping on my website and my Etsy shop,” she said on Monday. “I’m going to spend the rest of the day adding 50 per cent to a substantial amount of my items.”
Baldassi’s business was briefly hit by earlier rounds of tariffs until she was able to keep shipping tariff-free to the U.S. by proving her products were CUSMA-compliant. That option doesn’t exist this time.
Cindy Baldassi, who sells handmade jewelry out of Calgary, is among the Canadian business owners bracing for a new round of U.S. tariffs that would impose a 50 per cent levy on various products as of Wednesday. Baldassi says she was able to mostly avoid an earlier round of tariffs by proving her products were CUSMA-compliant, but that option won’t exist this time.
She said she’s been able to increase marketing in Canada over the past year and sell more domestically, but about three-quarters of customers to her Etsy shop were American. She notes her one-person business doesn’t have a marketing team or big budget to help expand.
“We often have to really scrape to get what traffic we can to our websites. And I don’t have a lot of control over where Google tends to show me or where Etsy wants to show me,” Baldassi said.
Guénette said pursuing customers in non-U.S. markets is a common theme these days.
“Many businesses in Canada don’t feel the U.S. is a reliable trade partner anymore,” he said.
Businesses already burned by tariff threat
Even if the new swath of tariffs don’t come to pass, some business leaders say they’ve already had an impact.
Randy Williams, director of sales and marketing for Monterey Textiles, says his business has longstanding operations on both sides of the Canada-U.S. border. In recent years, they’ve ensured all of their products can be made in factories in either country to limit international shipping.
He says business on the Canadian side is strong, so Monterey will be all right. But, as a board member with the Canadian Textile Industry Association, Williams said he is aware of other textile makers who have already made tough choices as a result of the mere threat of new tariffs.
“People have already been laid off. Orders aren’t coming in. U.S. customers are possibly searching for other suppliers,” said Williams.
“The threat of them being put in place had a significant impact already.”
As an Aug. 19 deadline looms, Albertan beekeepers are bracing for a proposed 50 per cent U.S. tariff on its product. As CBC’s Nadeer Hashmi reports, the new tax could be devastating for the industry.
In Alberta, beekeeper and owner of Gull Lake Honey, Lorne Prins, says he’s aware of other producers that have been racing to ship honey to the U.S. as soon as it’s extracted in order to get ahead of the deadline.
Prins sells most of his honey locally and sends some of it to a large buyer in Alberta. But if new tariffs prevent other honey producers from selling to the U.S., that could stick Canada with tonnes of surplus honey, impacting the price at which he sells his product.
“It will strand an enormous amount of honey on the Prairies and it could be really, really damaging to our price this year,” Prins said.
If the tariffs do go through, he’s hoping Canadians can pick up the Buy Canadian movement again in order to support local businesses that will need the help.
