Key facts
- US President Trump's tariffs on Canadian products are impacting businesses that rely on cross-border supply chains.
- Sweetapolita, a Toronto-based sprinkle company, is affected by US tariffs on ingredients like cellulose gum and glucose.
- Penny Ice Creamery in Santa Cruz, California, is a significant buyer of Sweetapolita's sprinkles.
- Canadian consumers are showing a preference for Canadian-made products due to the trade war.
- The US tariffs on Canadian goods took effect on August 22.
- Canada imposed retaliatory tariffs on US imports on September 11.
President Trump's trade policies have created uncertainty for businesses operating across the US-Canada border, with a wide range of products now subject to new tariffs. Rosie Alyea, chief sprinkle officer at Sweetapolita in Toronto, has faced significant disruption due to US import restrictions and subsequent tariffs on ingredients like cellulose gum and glucose. These tariffs impact her ability to sell to American customers, including businesses like the Penny Ice Creamery in Santa Cruz, California, which relies on Sweetapolita's products.
The trade dispute escalated after negotiations between the two countries collapsed, leading the Trump administration to impose tariffs on August 22. In response, Canada implemented its own retaliatory tariffs on US imports on September 11, described as a "dollar-for-dollar" measure. These tariffs range from 15% to 50% on approximately $20 billion worth of US goods, including steel, aluminum, dairy, appliances, and clothing.
While many consumers have not yet noticed drastic price increases, with advisory firm Oxford Economics estimating only 0.25% of the average consumer basket directly affected, experts warn of potential indirect cost increases over time. Tariffs on packaging materials, for instance, could make finished food products more expensive. Retail analyst Bruce Winder noted that stores are still selling pre-tariff inventory, suggesting price hikes may appear gradually.
Amid the escalating trade war, Canadian consumers are increasingly opting for domestic products. Mateus Gujrel, a software developer, is one such consumer who consciously chooses Canadian-made items. Market research firm Narrative Research indicates this trend of supporting Canadian businesses is strong and ongoing, fueled partly by President Trump's rhetoric about potentially making Canada the "51st state."