How the US-Canada trade war is being felt on both sides of the border

ByNadine Yusif, Senior Canada Reporter and Jessica Murphy, Canada editorPublished3 hours agoThe US and Canada appear no closer to resolving their ongoing trade dispute.

Tensions have been simmering between the two neighbours since President Donald Trump returned to the White House just over 18 months ago, and unleashed a wide-ranging global programme of tariffs.

Canada was one of the first countries the Trump administration hit with levies, and is one of two countries to respond with its own reciprocal measures.

Currently, the US has hit Canada's key sectors of steel, aluminium, lumber and automobiles with tariffs, and last week imposed an additional 50% levy on about C$28bn ($20bn; £15bn) of Canadian goods.

Canada has hit back with its own counter-tariffs on American goods, announcing on Tuesday what it calls a "dollar-for-dollar" and "strategic" retaliation designed to match the US tariffs.

With no resolution in sight, how has this enduring trade war affected Canada and the US, and what could come next?

The tariffs and counter-tariffs have hit some states and provinces harder than others.

In Canada, some provinces have been more exposed to US sectoral tariffs on steel, steel derivatives, aluminium, and autos and vehicle parts that don't comply with the current North American trade deal, known as the USMCA.

Ontario, the most populous province with a significant manufacturing sector, has been hardest hit by the auto and steel tariffs.

Several Ontario auto parts and assembly plants have announced layoffs and production cuts, and the province is estimated to have lost tens of thousands of manufacturing jobs since early 2025.

Metal exports from Quebec - which produces steel, copper and aluminium - fell 36% between February 2025 and 2026, and there was a 3.6% drop in employment in the sector, according to data released in July.

The Royal Bank of Canada estimates that Ontario and Quebec are the most impacted by US sectoral tariffs, while Newfoundland and Labrador, New Brunswick, Alberta, Saskatchewan and Prince Edward Island are the least exposed.