President Donald Trump is following through on his threat to charge 25 % tariffs against Mexico and Canada after they failed to meet his needs to prevent drugs and illegal immigrants from entering the United States.
Despite earlier cooperation from both neighboring countries to try to pacify Trump, who threatened to create a tax on exports before he returned to the White House, his presidency hasn’t been satisfied with the steps Mexico and Canada have taken.
The White House announced on Tuesday that the taxes on Mexico and Canada may be enacted after they were delayed by a quarter. Later that evening, Commerce Secretary Howard Lutnick teased that an agreement may alleviate some of the taxes on Wednesday.
During his first name, Trump used the threat of tariffs as a bargaining chip with many countries, including China.
Gas, food, and alcohol prices are expected to rise due to the tariffs on Mexico and Canada, which could destroy a crucial promise Trump made on the campaign trail to take down the price of consumer goods.
Here are some of the products imported from Canada and Mexico that could be affected.
Materials ( plastics, aluminum, etc. )
Elements such as plastics, metals, and wood are some of the best big imports from Canada to the U. S., according to Trading Economics. Canada exports roughly$ 8 billion in softwood lumber every year, with the U. S. being the single largest purchaser. Cranking up costs for lumber could limit the number of new houses being built, undercutting one of Trump’s primary promises to voters to make their lives more affordable.
Major exports from Mexico to the U. S. include materials such as plastic, aluminum, rubbers, and glass.
Agriculture
Agricultural products are expected to be significantly affected by the new tariffs.
According to the U. S. Department of Agriculture’s Economic Research Service, 63.8 % of U. S. agriculture imports from Canada in 2023 were meat, animal products, grains, and feeds, along with oilseeds and oilseed products. The vast majority of agriculture imports from Mexico in 2023, 72.5 %, were vegetables, fruit, beverages, and distilled spirits.
Gas
The tariffs on crude petroleum could be especially painful for the U. S., which imported more from Canada than from any other country in 2023. The U. S. imported$ 97 billion of crude petroleum from Canada that year, compared to$ 20 billion from Mexico and$ 55 billion from the rest of the world.
Gasoline has been one of the items most frequently discussed when people have expressed concerns over the possible cost of tariffs.
Cars
The auto industry has been spared from tariffs for now, with Trump announcing automakers would get a one-month pause on the 25 % blanket tariff.
Vehicles are also one of the largest imports from Mexico into the U. S. Since Trump’s first term, U. S. trade with Mexico has gone up across the board, with vehicles and car parts being a big driving in that increase.
While the countries ‘ trade-in vehicles and auto parts was always robust, it has soared since 2017, with the U. S. importing$ 30.4 billion in vehicles in 2017 and$ 44.8 billion in 2023. Similarly, the U. S. imported roughly$ 22.6 billion in auto parts in 2017 and$ 34.8 billion last year.
Alcohol
The price of the country’s No. 1 beer brand, Modelo, will also rise. Constellation Brands, which imports Modelo and Corona beer, could see its costs increase by 16 % under Trump’s proposed tariff and would likely have to raise prices by about 4.5 %, according to Chris Carey, a Wells Fargo equity analyst. Tequila made in Mexico would also be more expensive.
TRUMP ADMINISTRATION GIVES AUTOMAKERS ONE MONTH REPRIEVE FROM TARIFFS
Canada is the U. S.’s second-largest trade partner, including being its largest export partner and third-largest import partner. Canada accounts for 12.8 % of imports into the U. S., according to the Census Bureau. In 2022, the U. S. imported$ 493.1 billion worth of goods from Mexico.
The Trump administration has also teased reciprocal tariffs beginning on April 2 after Mexico and Canada threatened to retaliate with their own levies.
