Canadas

Abbotsford, British Columbia – Every second day, 28,000 litres of raw milk leave Casey Pruim’s farm in Abbotsford in western Canada, entering a distribution system built on the assumption that the milk and the products made from it will have somewhere to go.

While most is consumed in Canada, some had been sold across the border to the United States.

Those sales have largely come to a standstill since US President Donald Trump’s 50 percent tariff on $20bn in Canadian goods, including dairy products, came into effect on August 22.

Pruim, who is also chair of the British Columbia Dairy Association representing about 400 dairy farmers across the province, told Al Jazeera that Canadian farmers do not individually decide which products are exported.

Instead, producers such as Pruim –  whose farm has 330 cows milked three times a day  –  sell into the provincial milk-marketing system, which distributes milk to processors according to demand, including for products exported to the US.

If a processor loses US demand, it may require less milk, with the impact then spread across the provincial pool.

Dylan Kruger, director of public affairs at BC Dairy, told Al Jazeera “there is still considerable uncertainty around the impact of the US tariffs”.

He said it was too early to know how the industry would be impacted or whether milk no longer sold to the US could be sold elsewhere, mitigating financial losses.

But the tariffs and wider trade tensions have already introduced uncertainty and instability for businesses.

“If the processor who’s exporting some of his product to the United States can no longer sell into that market because he’s now priced out of the market with a 50 percent tariff, that’s how it would impact the dairy farm,” Pruim said.

Pruim said if processor demand is squeezed, farmers would be forced to dump the milk. In the worst-case scenario, the herd has to be cut.

“Cows aren’t like a tap; you can’t just turn them on or off,” he said.

His warning captures dairy’s particular vulnerability in a tariff war: Milk is highly perishable, collected on a tight schedule and dependent on processors whose demand can change much faster than farmers can adjust production.

“These tariffs are completely unwarranted,” David Wiens, president of the Dairy Farmers of Canada, told Canada’s CBC News, adding that they would affect “the supply chain, not only in Canada but in the US as well”.

Supply-management system

Dairy trade between Canada and the US has largely operated under a free trade agreement between the US, Mexico and Canada, known as CUSMA in Canada.

Canada manages the supply of dairy, poultry and eggs through a national agricultural policy known as supply management. The system uses production quotas and import controls, including tariffs, to provide farmers with more stable and predictable prices while maintaining domestic supply.

Critics describe the system as protectionist and as a government-backed cartel.

Washington argues that Canada’s supply-management system restricts US dairy exports. Trump posted on Truth Social that “Canada had been ripping off the United States of America for years” and accused it of imposing “ridiculously high tariffs” that made life impossible for US farmers.

Canadian producers reject that argument, saying the existing trade agreement already gives US imports substantial tariff-free access that is not fully utilised.

Canada’s dairy trade deficit with the US has grown significantly since CUSMA came into force on July 1, 2020, according to the Dairy Processors Association of Canada.

In 2020, Canada exported 241.3 million Canadian dollars ($173m) in dairy products to the US and imported 647.4 million Canadian dollars ($462.7m) worth of dairy and dairy products. In 2025, Canadian dairy exports had risen to 308.7 million Canadian dollars ($220.7m) while dairy imports from the US had more than doubled to 1.355 billion Canadian dollars ($968.5m), accounting for 13.8 percent of total value of US dairy exports, according to the association.

Bryan Yu, chief economist at Central 1 credit union, said the immediate shock of losing a major market could be difficult for Canadian producers to absorb because replacement buyers cannot be found quickly.

“There is going to be pain in the near term for a lot of our producers,” Yu told Al Jazeera.

“You really can’t quickly adjust to a 50 percent tariff, because it’s uncharted waters for a lot of industries … and ultimately it shuts [Canadian producers] out, because a lot of them don’t have the margins that they can play with,” he said.

Yu said Canadian consumers might absorb some of the additional supply while exporters search for new markets and higher-value products, but neither adjustment is instantaneous.

“There are global markets as well, especially when you talk about chilled, chilled beef, chilled products and really it’s a question of whether … other types of markets that could be available.”

Canada has also imposed retaliatory tariffs, which came into effect on September 8 and cover $20bn worth of US products.

Dairy products are among the targeted goods. The list includes a 50 percent tariff on milk, cream and whey products and a 25 percent tariff on many cheeses imported from the US.

Canadian Prime Minister Mark Carney has framed Ottawa’s response as both retaliation and an attempt to build greater economic resilience.

Announcing the collapse of the latest negotiations, he said Canada would match Washington’s new tariffs “dollar for dollar” to protect workers, farmers, families and businesses.

But retaliatory measures carry risks of their own.

“Canada’s new retaliatory tariffs will help some industries but hurt most and weaken economic growth across the country by raising costs for producers and consumers,” Oxford Economics said in a report.

For now, geography remains important for perishable goods like dairy products that once moved quickly across the US border and cannot be redirected overnight to a distant market without new buyers, logistics and regulatory approvals.

Ottawa’s Trade Commissioner Service is advising affected companies to check their CUSMA compliance, explore available relief and contact trade commissioners about potential new markets.

Yu predicted that the US and Canada could reach a tariff deal in the following months but said the interim period could bring “higher prices, weaker economic activity and deeper mistrust”.

For Pruim, the uncertainty is as destabilising as the tariff threat itself.

“I think, like [for] any Canadian, it’s disappointing to have these trade talks collapse again and just the uncertainty around it.”

In address to European parliament, Canadian Prime Minister Mark Carney listed areas where he wants to boost cooperation.

Canadian Prime Minister Mark Carney has welcomed the prospect of his country becoming the European Union’s first associate member, saying such an alliance is aimed to be a “beacon for democracies” and not to “dominate others”.

Speaking in the European Parliament in Strasbourg, Carney said Canada “welcomes” von der Leyen’s ambition to make the country an associate member.

“We are not fair-weather allies. We do not pursue zero-sum deals. We hold common values for which we have always fought, and in whose defence we must always remain vigilant,” Carney said to applause from European lawmakers.

“Canada and Europe are each strong. Europe and Canada are stronger together.”

“I am not proposing a third bloc in order to become a great-power rival – only with better manners,” he continued. “We do not seek power to dominate others. On the contrary, we are pursuing resilience so that no one can control our open markets, impair our sovereignty, threaten our territorial integrity, or undermine our freedoms, our democracies, our rule of law.”

Carney listed a slew of areas where he wanted to ramp up cooperation.

“Canada and Europe should secure our strategic autonomy through deep cooperation in the full range of strategic capabilities, including critical minerals, defence industrial capacity, AI and compute, energy security, space and payments.”

He also said the EU and Canada should move towards “seamless digital trade” and allow young people from both sides to work and study on either side of the Atlantic.

The EU and Canada have been facing stiff rivalry and pressure from Trump’s administration on trade, among other matters, and from an increasingly assertive China.

Trump threatened late on Wednesday to take action against the EU if it moves forward with von der Leyen’s proposal of associate membership for Canada.

“If they do that, if I think it’s at all a hostile act, I will put very serious tariffs or stop trading with Europe on many things,” Trump told reporters, calling the proposal “laughable”.

“If it’s a good intention, that’s fine. If it’s a bad intention, we’ll put very heavy tariffs on Europe,” he added.

The European Commission (EC) said von der Leyen’s proposal – which is yet to be fleshed out and will need to be approved by EU member states to go forward – was not a hostile act.

“As our President (von der Leyen) made clear yesterday, the proposed strengthening of our partnership with Canada is not against anyone else, but for our common strength,” said Olof Gill, an EC spokesperson.

WASHINGTON — A trade war between the United States and Canada entered a new phase Tuesday as Ottawa’s retaliatory tariffs on American goods took effect, escalating a dispute that has steadily strained relations between the allies.

Canada’s tariffs, which came into force just after midnight, cover roughly $20 billion in U.S. goods and impose duties of as much as 50% on products, from steel and aluminum to farm equipment, clothing and electronics. The list also reaches into the everyday commerce that binds the two economies, including cheese, seafood and cosmetics.

It was the latest sign that relations between the two neighbors have reached their lowest point in decades, after Trump dismissed Canada as the 51st American state, moved to rename Lake Ontario and mocked its armed forces.

Ottawa’s latest measures are a response to tariffs imposed by President Trump last month on Canadian exports. The two governments had appeared close to a trade deal just a month ago. But talks broke down in dramatic fashion, leaving both sides aggrieved and accusing the other of negotiating in bad faith.

In a post Tuesday, Trump said Canada “has been ripping us off for years” and threatened to respond by removing access for Canadian businesses to key American markets.

“What many do not realize is that the Canadian Government, including Canadian Provinces, have banned American Small Businesses and Companies from selling into their Government Procurement Markets,” Trump wrote. “This is the case even though Canada gets broad access into the massive American Government Procurement Market, including those of our States.

“That is not reciprocity, it is a Canadian Trade Scam. From now on, NO RECIPROCITY — NO ACCESS!” he continued. “I am hereby directing the [General Services Administration], working with the [U.S. Trade Representative], to take all necessary steps to REMOVE Canadian-origin products from GSA’s Multiple Award Schedules unless Canada restores full and fair reciprocity for American Farmers and Companies.”

Canada’s prime minister, Mark Carney, has characterized the confrontation as more than a dispute over tariffs, arguing that demands by a bullying Trump administration threaten Canada’s economic independence.

In a video released Tuesday, Carney argued that in the past, the United States has tried to use tariffs to “break us,” only to have Canada’s economy grow stronger and more diversified. He urged Canadians to buy Canadian and break economic dependency from the United States.

“This won’t be easy, and I won’t pretend otherwise,” Carney said. “But Canadians have faced difficult stretches before, and what has carried us through has never ever been any one measure. It’s always been Canadians looking out for each other.”

Trump, meanwhile, has pressed Canada to make concessions on trade and has warned of further tariffs, including potentially higher duties on Canadian automobiles. He also threatened to ban the sale of aircraft from Canada’s Bombardier unless its products are manufactured in the United States.

“If they want our Market, they must build here, and stop treating America like a ‘piggybank,’” Trump wrote on Truth Social on Monday. “BUY AMERICAN. FLY ON AMERICAN AIRLINERS. ENJOY AMERICAN LIQUOR AND BEVERAGES. SAIL ON LAKE AMERICA. AMERICA FIRST!”

Earlier Monday, Trump posted an image showing Mexico, Canada, Central America, Greenland and Caribbean nations with the colors of the American flag. He also posted a caricature of him and Carney playing hockey in which Trump tells him: “Get up, Governor.”

Both sides stand to lose in a trade war poised to hurt businesses large and small across the world’s longest international border.

A prolonged economic conflict poses long-term risks for Canada, which faces price hikes and investment losses from the United States, by far its largest trading partner.

But Americans may also confront higher costs at a time when inflation is already a stubborn problem for the Trump administration. And the trade war may be felt most in northern border states set to hold midterm elections that could swing control of the U.S. Senate, becoming yet another political challenge for embattled Republican lawmakers.

In Maine, Republican Sen. Susan Collins, who is seeking reelection, has called Trump’s tariffs “a mistake.” In Michigan, Democratic Senate nominee Abdul El-Sayed released a video Tuesday highlighting everyday goods that have risen more than 30% over the last year, including Tide Pods, toilet paper and Tim Hortons coffee, as the trade conflict and war in Iran drive up costs.

American alcohol has also been the target of boycotts imposed by several Canadian provinces since March 2025 in response to earlier tariffs on Canadian goods by Trump.

The boycotts since then have erased roughly $360 million in revenue for the U.S. wine industry, according to a Wine Institute report, which represents California wineries. Canada makes up more than 35% of the export market for U.S. wine, more than the EU, U.K. and China markets combined.

For some California winemakers, the impact was even greater. One Sonoma winery referenced in the report said Canada made up about 85% of its international sales. Multiple wineries have had to lay off employees because of hits to their business.

“It’s had a tremendous negative impact,” said Julie Berge, vice president of communications at the Wine Institute.

Wine is not the only California business that has taken a hit — tourism has also seen a sharp decline in arrivals from Canada. In 2025, visitors from the country dropped by 20%.

Canada also targeted the agriculture, electronics and transportation equipment industries with its tariffs announced Tuesday, all of which have a presence in California.

Soon after the World Cup brought positive international attention and tourists to the United States, Trump escalated trade tensions with Canada.

“You went from this really high, exciting moment for the U.S. in terms of international attention, to the next week, it’s negative again,” Deborah Friedland, a hospitality consultant at financial services firm Eisner Advisory Group, told the Associated Press. “It’s one step forward and two steps back.”

Times staff writers Wilner and Ceballos reported from Washington and Duneja from Los Angeles.

Trade tensions soar as Canada matches US tariffs ‘dollar-for-dollar’, impacting 700 products and multiple industries.

Canada’s retaliatory tariffs on imports from the United States have taken effect, escalating the trade dispute between the two countries.

Tariffs ranging from 15 percent to 50 percent will apply to nearly $20bn worth of US imports from 12:01am ET (04:01 GMT) on Tuesday, matching US-imposed levies on Canadian goods including machinery, textiles and consumer products.

The new retaliatory tariffs apply to products including steel, household appliances, agricultural equipment and dairy.

“Canada will match Washington’s new tariffs dollar for dollar in order to protect Canadian workers, farmers, families, and businesses,” Canadian Prime Minister Mark Carney told reporters in late August.

US President Donald Trump announced 50 percent tariffs against Canada in July, citing “discriminatory treatment” of US products. The announcement prompted the countries to enter trade talks in August, but a final deal failed to materialise before a deadline imposed by Trump.

“Canada wants the benefits of being a State, without being one!!!” Trump posted on Truth Social in response to Canada’s announcement in August.

The Canadian government said in a statement that the counter-tariffs will impact more than 700 products, adding that it would launch a $5.42bn support package for affected small and medium-sized businesses and workers.

On the eve of Ottawa imposing its tariffs, Trump threatened to block Canada-based aircraft manufacturer Bombardier from selling its planes in the US unless it began manufacturing them in the country.

The dispute has also extended beyond tariffs, with Trump signing an order last month renaming Lake Ontario “Lake America” for US federal use.

The retaliatory tariffs could place a financial burden on US automakers as Canada is the largest buyer of US-manufactured cars.

Americans could soon see increased prices on 550 consumer goods from Canada. According to a report from the Kiel Institute for the World Economy, US importers and consumers absorb 96 percent of the tariff burden.

Canadian Prime Minister Mark Carney has reprimanded the United States for what he describes as a flippant approach to the ongoing trade dispute between the two countries.

On Tuesday, Carney hit back against a series of insults and disparaging remarks from US President Donald Trump and his officials, saying that talks can proceed once Washington takes a more serious approach to the issues at hand.

“When the Americans stop doing memes, stop throwing shade and stop trying to be tough, and start being serious about having those discussions, we can have those discussions,” Carney told reporters in Ottawa. “It’s not constructive, but that’s their democracy.”

The Liberal Party leader’s remarks come as tensions flare once again between the US and Canada, which have historically had tight relations.

But Trump’s second terms have caused those ties to fray. Since returning to office in 2025, Trump has imposed a series of tariffs on Canadian products, prompting retaliatory actions.

The latest round of tariffs came on August 22, when negotiations between the two countries fell through.

As a result, 50 percent tariffs were imposed on roughly $20bn worth of Canadian goods. Canada has pledged to respond with tariffs on US goods, worth roughly the same dollar amount, starting on September 8.

In the aftermath of the failed negotiations, Carney blamed the impasse on last-minute US demands.

He accused the Trump administration of seeking to limit Canada’s ability to cement trade deals with other countries and of requesting changes to laws protecting Canada’s French language and culture.

Carney also said Trump’s team attempted to push an asymmetrical deal that would damage Canada’s industries.

“Canada’s a sovereign state. We will strike free trade deals with the countries we wish to strike free trade deals with,” Carney told reporters on Tuesday. He added, “Of course, we’re not going to accept those terms.”

The trade war between the two countries has prompted a surge of nationalism in Canada.

A June poll from the research firm Abacus Data found that national pride surged 12 points in two years, reaching 77 percent this year.

Carney has faced pressure not to yield to US demands. In addition to imposing steep tariffs, the Trump administration has also pushed Canada to cede its sovereignty and become a “51st state” within the US.

Trump has also taken symbolic actions designed to assert US dominance over the two countries’ shared border region. On August 27, the US president signed an executive order directing federal entities to refer to Lake Ontario as “Lake America”.

“They are one of the worst countries in the world to deal with,” Trump said of Canada in a recent radio interview.

Other cabinet-level officials in the Trump administration have echoed Trump’s remarks disparaging Canada.

US Treasury Secretary Scott Bessent told the news outlet CNBC that Canada’s economy is ill-equipped to handle a trade war with the US, and he blamed Carney for escalating the situation.

“Well, I don’t think you can be in a tit-for-tat with someone who’s 13 times larger than you are,” Bessent said on Monday.

Of Carney, he added, “He came to power on an anti-American, anti-Trump agenda. He was 20 points behind in the polls. And then he started this. And it’s unfortunate that he’s not doing what’s best for the Canadian people.”

US Secretary of Defense Pete Hegseth, meanwhile, posted an image of two female Canadian cadets on social media, in an apparent effort to mock the country’s armed forces.

“This is real,” he wrote beneath the image of the two women, alongside an emoji of the Canadian flag.

Hegseth, a former TV host, has frequently castigated efforts to include women, LGBTQ people and racial minorities in the military as “woke” distractions from the US military’s core mission.

When reporters asked Carney to respond to such messages, he replied that such comments were “beneath” the officials’ office.

“Our plan has always been standing up for Canada, first and foremost, here at home,” Carney said.