Key facts
- The US and Canada are engaged in a trade war following the breakdown of negotiations.
- Canada plans to impose tariffs of 25%-50% on nearly 900 US goods starting September 8.
- Toilet paper and facial tissues are specifically targeted for tariffs by Canada.
- The US imported $328 million in toilet paper from Canada in 2024.
- Other affected sectors include Canadian liquor, dairy, auto parts, and US fishing products.
North America faces escalating trade tensions as the US and Canada enter a full-fledged trade war, potentially leading to significant price increases for consumers, particularly on paper products. Following the breakdown of trade negotiations last weekend, Canadian Prime Minister Mark Carney announced that Canada would match US tariffs dollar for dollar, targeting nearly 900 American goods with tariffs ranging from 25% to 50% starting September 8.
Paper products, including toilet paper and facial tissues, are among the sectors most severely impacted. Canada has threatened tariffs of 25% to 50% on these items in retaliation for a 50% tariff hike by the US. Although many American toilet paper and tissue products are domestically produced, they rely heavily on Canadian lumber for raw materials. Procter & Gamble, the maker of Charmin, had previously indicated price increases due to existing tariffs.
In 2024, the US imported $328 million worth of toilet paper from Canada, making it the largest exporter of the product to the US. Retailers like Costco also source a substantial amount of their paper products from Canada. The average American consumes 141 rolls of toilet paper annually, highlighting the potential impact of these tariffs on consumer goods.
The trade war extends beyond paper products, underscoring the deep economic ties between the two nations and raising concerns about inflation on both sides of the border. US tariffs are specifically targeting Canadian liquor, including popular whiskey brands, and dairy products. While Canada has not imposed tariffs on American liquor, most Canadian provinces have banned American alcohol in retaliation for earlier US tariffs on Canadian products. Donald Trump cited these provincial bans as justification for his new tariffs.
Canada has also imposed a 25% tariff on American fish and seafood, including frozen lobster, drawing criticism from US Senator Susan Collins. Furthermore, a 25% tariff on Canadian cars and auto parts is expected to affect the American auto industry, which is heavily reliant on Canadian components. Trump has threatened to increase this tariff to 50% if a deal is not reached by January 1, 2027.
With negotiations stalled, the duration of these tariffs remains uncertain. However, the Trump administration, through US trade representative Jamieson Greer, has asserted that the trade dispute will not impact US consumers, citing strong economic fundamentals.