Trump’s Trade War Hits Canada the Hardest
In any trade war, there are no true winners—but some countries lose more than others. That’s become clear in the case of President Donald Trump’s tariffs, which are striking Canada far more severely than Mexico, despite both being close trading partners of the United States.
New data shows a dramatic decline in truck traffic and trade volume between Canada and the U.S., reflecting the disproportionate economic toll on Canada’s export-heavy sectors.
Canadian Truck Crossings Drop Sharply
According to U.S. Customs and Border Protection, the number of commercial trucks entering the U.S. from Canada dropped 10.5% in May compared to the previous year. The month before, in April—when the first round of tariffs was introduced—the drop was 11.4%.
In contrast, Mexico saw a much smaller dip. U.S.-bound trucks from the southern neighbour declined just 2.8% in May, an improvement over the 6.4% drop in April. The gap between the two countries suggests that Canada’s exports are being hit significantly harder by Trump’s protectionist policies.
Trade Volumes Tell the Same Story
It’s not just the trucks. The total value of U.S. imports from Canada fell 14.4% in April, compared to the same period in 2024. Imports from Mexico, however, declined by only 2.7%.
Why the imbalance? It largely comes down to what each country exports. Canada supplies a massive share of America’s steel and aluminum, while Mexico’s trade profile leans more heavily on consumer goods and auto parts—sectors that have, so far, been less directly targeted.
Steel and Aluminum: The Key Pressure Points
Canada accounted for 25% of all U.S. steel imports last year and supplied about half of its aluminum. These sectors are now under direct fire. As soon as the initial tariffs came into effect in April, exports from Canada to the U.S. in both categories dropped significantly.
And things have only worsened. In June, Trump doubled tariffs on steel and aluminum imports to 50%, amplifying the economic shock and likely setting Canada up for even sharper losses in the coming months.
Mexico’s Cushion from the Storm
Mexico’s more diversified and consumer-focused export economy appears to be cushioning the impact. While some sectors have felt the pinch, the broader slowdown in trade has been less severe.
This contrast has sparked concern in Canada’s business and policy circles, as the country watches trade volumes fall at a time when global supply chains are already under stress.
Economic Experts Sound the Alarm
Sal Guatieri, a senior economist with the Bank of Montreal, pointed out the root of the issue: “Canada’s dominance in steel and aluminum exports makes it especially vulnerable. These tariffs target exactly the sectors where Canada leads.”
That dominance is turning into a liability under current U.S. trade policy, especially as American protectionism shows no sign of slowing ahead of the next election cycle.
What’s Next?
With tariffs now doubling down on Canadian exports, and Mexico weathering the storm more gracefully, the question is whether Canada will seek countermeasures, push harder for diplomatic solutions, or refocus trade efforts elsewhere.
In the meantime, industries across Canada—especially in manufacturing and metal production—are bracing for more economic turbulence in the months ahead.
Stay tuned to Maple Wire for more updates on trade, policy, and the shifting global economy.
