Listeners, here’s your essential update for the Canada Tariff News and Tracker podcast as of September 12, 2025.

Canada made headlines on September 1st when Prime Minister Mark Carney announced the removal of retaliatory tariffs on United States goods covered by the United States-Mexico-Canada Agreement, including alcohol and other consumer products. This move aligns Canada with the US on USMCA-covered imports, easing tensions and supporting ongoing negotiations as the current agreement approaches its 2026 expiration. However, sectoral tariffs remain firmly in place: Canada is still imposing a 25 percent rate on US steel, aluminum, and autos, a position Carney says is essential to “preserving economic leverage” while discussions for a new bilateral trade deal continue. More than 75 percent of Canada’s exports go to the US, highlighting how critical trade stability is for Canadian jobs and growth according to Brauwelt International.

Sources close to industry point out that the US, under President Trump, maintains a steep 50 percent tariff on most steel and aluminum imports – Canada included – as well as high duties on autos and copper. The Brookings Institution confirms these tariffs are part of Trump’s push for sectoral “trade deals,” with reciprocal tariffs now ranging from 15 to 50 percent on various products as of September 11th, per Baker Botts LLP’s latest tracker. Goods exempted from these new reciprocal tariffs include some agricultural products, aircraft parts, and minerals not produced in sufficient quantities in the US, but key Canadian manufactured exports are still hit hard.

Economists at RBC report that Canadian goods exports to the US have dropped 5 percent year-over-year in July, driven almost entirely by tariffed items like steel, aluminum, aerospace, and auto parts. In fact, exports of steel and aluminum plunged 40 percent, while aerospace products fell 39 percent. RBC notes 88 percent of Canadian exports to the US are still duty-free due to CUSMA, but the remaining 12 percent face tariffs averaging up to 27 percent, causing real pain for Canadian manufacturers, transport, and warehousing sectors. Despite these headwinds, RBC cautiously predicts limited further deterioration for Canada’s economy as most exports remain protected by trade agreement exemptions.

Meanwhile, Trump’s administration announced further changes to tariff policy this week, excluding certain critical minerals and pharmaceuticals from reciprocal duties, and signaling that future trade deals – including with Canada – may bring targeted tariff relief on key products. But ongoing trade monitoring and stepped-up enforcement mean the tariff environment remains volatile, prompting calls for tighter compliance from businesses relying on cross-border supply chains.

To sum up, listeners: Canada’s removal of USMCA-linked tariffs marks a strategic pivot, but high sectoral tariffs on industrial goods remain, and US rates on Canadian exports still reach 15 to 50 percent on many items. The road to a new trade deal is uncertain, and key Canadian industries continue to feel the tariff sting. Stay tuned every week as we track the latest tariff headlines, trade negotiations, and their impact on the Canadian economy.

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