Trump targets Canadian dairy with new tariff threat, stirring trade dispute

USA – U.S President Donald Trump has announced a potential new wave of tariffs targeting Canadian dairy products, just one day after offering Canada a temporary reprieve from broader trade penalties. 

The announcement, made during an Oval Office address, highlighted Trump’s ongoing frustration with Canada’s dairy trade policies and has sparked immediate pushback from Canadian leaders.

Trump pointed to Canada’s roughly 250% tariff on U.S. dairy exports as justification for his plan. 

“Canada has been ripping us off for years on dairy products,” he said. 

“We’re going to charge the same thing. It’s not fair. It never has been fair, and they’ve treated our farmers badly.” 

He indicated the tariffs could take effect as soon as Friday or by early next week, leaving businesses and markets uncertain about the timeline.

Canadian Trade Minister Mary Ng swiftly rejected Trump’s accusations. “I learned about it just as I was walking into this press conference,” Ng told reporters. “These tariffs, if imposed in that order of magnitude, are completely unjustified.” 

According to Ng, claims of Canada exploiting the U.S. through dairy trade are “not true,” and she called for dialogue to resolve the dispute.

The tariff threat comes on the heels of Trump’s Thursday decision to pause broader tariffs on Canada and Mexico under the U.S.-Mexico-Canada Agreement (USMCA). 

That move had briefly eased concerns for industries like agriculture, but Friday’s focus on dairy reversed much of that optimism. 

A report by economic analysts noted that while stocks dipped after the announcement, they later climbed, with the Dow closing up 222 points following reassuring comments from Federal Reserve Chair Jerome Powell.

Canada’s high dairy tariffs, including a 241% levy on milk, apply only after U.S. exports exceed a quota, a limit rarely reached due to Canada’s protective measures.

Becky Rasdall Vargas of the International Dairy Foods Association welcomed efforts to address these barriers but cautioned that a prolonged tariff conflict could harm U.S. farmers. 

“A tariff war with our top trading partners will continue to create uncertainty and additional costs for American dairy farmers and rural communities,” she said in a statement, urging both nations to negotiate a solution.

The dairy dispute isn’t new. In 2023, a trade panel ruled in Canada’s favor, upholding its tariffs under the USMCA, a decision criticized by figures like Wisconsin Senator Tammy Baldwin for burdening U.S. farmers. 

Trump, who signed the USMCA, has long complained about Canadian dairy policies but did not secure lower tariffs in the deal. 

With economic uncertainty already weighing on markets, this latest threat adds pressure to U.S.-Canada relations and the dairy industry on both sides of the border.

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