New tariffs pending on American products coming to Canada has some businesses worried.
On Friday morning, the United States announced tariffs on steel and aluminium imports from Canada. In response, Prime Minister Justin Trudeau imposed $16.6 billion worth of tariffs against U.S. imports.
Scott Homstad’s business, Tri-Steel Manufacturing, is right in the middle of the trade war. The Grand Forks, North Dakota company produces agriculture machinery and gets some steel and aluminum products from Canada, but they also sell their finished equipment to their northern neighbours.
“It’s definitely going to impact us,” Homstad said. “The Canadian government slapping tariffs on American goods is not a good thing for us, that’s for sure.”
Homstad said the tariffs on Canadian products coming to the United States will also hit his bottom line, even if he chooses to buy from an American company.
“American distributors see they can take advantage of what’s going on because of tariffs going on Canadian suppliers,” he said. “That hikes up our prices and we have to reflect that in what we charge for our equipment or we’re losing money.”
In North Dakota, 87 per cent of exports go to Canada, making up more than $4 billion in trade going north.
The North Dakota Trade Office’s executive director Simon Wilson said he’s been getting lots of calls from businesses who are worried.
“Consumers on both sides of the border are affected as well, as they will likely bear the costs of each country’s imposed tariffs,” Wilson said. “It is our hope that active negotiations will continue, and such trade barriers will be swiftly eliminated.”
Homstad hopes the trade war won’t impact his business, but he said they’ve already seen the weak Canadian dollar play into their sales.
“The U.S. dollar is quite a bit stronger than the Canadian dollar,” he said. “That impacts our business more than anything right now.”
“It allows us to buy raw materials and whatnot in Canada less expensively, but it also makes our products available for Canadian consumption a lot more expensive. So it’s a double-edged sword, really.”
The Manitoba Chamber of Commerce said our province exports about $10 billion worth of goods and services to the U.S. every year.
A full list of the products affected by Canada’s reactionary tariffs can be found here.
That list includes things like ketchup, mattresses, pens, whiskies and orange juice.
Comments