Starting Tuesday, President Donald Trump has imposed a 25% tariff on imports from Canada and Mexico, sparking immediate retaliation. Canada has enacted countermeasures, applying 25% tariffs on $155 billion worth of U.S. goods, including pulp, paper, and steel products, while Mexico is set to announce its own countermeasures soon.
Industry leaders in the paper and metal packaging sectors are alarmed by the disruption these tariffs may cause to vital supply chains, especially between the U.S. and Canada. Heidi Brock, President and CEO of the American Forest & Paper Association (AF&PA), voiced concerns that these new tariffs could severely impact the industry’s complex cross-border supply systems. She explained that certain raw materials, such as fiber, are sourced from Canada due to specific quality demands and logistical efficiencies.
Québec-based paper company Cascades expressed worries about potential tariff impacts, particularly on shipments between the U.S. and Canada. Cascades’ CFO, Allan Hogg, stated that 11% of their sales come from products made in Canada and shipped to the U.S., and a significant portion of their raw production comes from the U.S. Cascades CEO, Hugues Simon, added that cross-border transfers of raw materials could expose the company to a 15% tariff risk.
The aluminum and steel industries are also expressing concern. The Aluminum Association emphasized the importance of Canadian imports for the U.S. aluminum industry, noting that approximately 2/3 of U.S. aluminum comes from Canada. Without access to these imports, the U.S. would face significant supply shortages, requiring billions in investments to become self-sufficient.
Clearwater Paper, Smurfit Westrock, and other companies are closely monitoring the situation, worried about the growing cost of production and the long-term impacts on U.S. exports. The introduction of a 20% tariff on Chinese imports also adds to the complexity of the global trade landscape.
