President Trump’s tariffs on Canada are creating clear winners and uneasy allies, with steel and lumber producers embracing the protection while alcohol and dairy groups see the levies as a bargaining chip to push Ottawa to the negotiating table.
Steel producers are the most vocal, arguing that tariffs during both of Mr. Trump’s terms leveled the playing field. They point to a sharp decline in foreign competition since Mr. Trump imposed 50% tariffs on imported steel.
Through July, total U.S. steel imports dropped 33.0% and finished steel imports fell 34.6% compared with the same period in 2025, according to data from the American Iron and Steel Institute.
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Imports from Canada fell even more sharply. Over the 12-month period from August 2025 to July 2026, Canadian steel shipments to the U.S. were down 42% compared with the prior 12-month period.
At the same time, American mills are shipping more steel. Domestic producers shipped nearly 55.75 million tons during the first seven months of 2026, with mills operating at 79% of their production capacity, up from 77% in July 2025.
Steel industry advocates say none of that would have happened without Mr. Trump’s 50% tariffs, which made imported steel more expensive and gave domestic mills more room to compete for U.S. customers.
“We’ve seen imports decline substantially and, more importantly, the share of the U.S. market taken by imports has declined,” said Kevin Dempsey, president and CEO of the American Iron and Steel Institute. “That’s allowed U.S. steelmakers to increase production, increase sales and invest upwards of $40 billion in upgraded plants and equipment. So it’s been very positive.”
Their perspective pushes back against critics who frame the tariff agenda as a costly, losing strategy for Americans.
“The mainstream has refused to cover the countless American workers, farmers, and businesses who have been undermined for decades by Canada and other countries’ unfair trading practices,” White House spokesman Kush Desai said. “President Trump’s trade actions have always been guided by putting these Americans first at home and abroad, and the administration remains committed to leveling the playing field.”
Beyond steel, the U.S. lumber industry says Mr. Trump’s tariffs on Canadian wood have given it a boost.
Domestic lumber producers are projected to add 2.5 billion board feet of capacity in the next two years. That translates to 1,667 more workers at the mills, 4,150 jobs in supplier industries and 3,100 jobs in surrounding communities, according to the U.S. Lumber Coalition.
The coalition noted that Canada’s U.S. market share plummeted from roughly 35% to 19% after first-term tariffs, while domestic suppliers expanded their market share from 60% to nearly 80%.
Zoltan van Heyningen, executive director of the U.S. Lumber Coalition, said the domestic market share for U.S. lumber suppliers increased “quite dramatically” because of Mr. Trump’s tariffs.
“It’s been a huge shift, and that means thousands of jobs were created here in the United States that otherwise wouldn’t have been created but for the trade law enforcement and Section 232 tariffs,” he said.
Yet these protections carry a price.
Builders and manufacturers are paying more for steel and lumber, and simmering tensions between the Trump administration and Ottawa escalated into an all-out trade war this summer, raising tariffs on a range of goods on both sides of the border.
Mr. Trump imposed 50% tariffs on Canadian alcohol, dairy and furniture in August, citing unfair treatment of American producers.
Canada recently slapped retaliatory tariffs on more than $20 billion in U.S. goods, including dairy. Several provinces have restricted U.S. alcohol since last year, causing a drop in their overall sales.
The trade war highlights a sharp economic divide: While protective tariffs shield primary producers, they squeeze downstream industries caught in the crossfire.
“There are trade-offs. While the steel industry might benefit from tariffs, steel-using industries get hurt. These include autos, construction, appliances and more. They have to pay more for their steel, and they have to charge consumers higher prices,” said Ryan Young, a senior economist at the Competitive Enterprise Institute, who noted that jobs in steel-using industries outnumber jobs in the steel industry by 80-to-1.
The stakes sharpened in recent days.
Hours after Canada retaliated on Tuesday, the Trump administration moved to block imports of most Canadian alcohol, dairy products and motorcycles.
Both sides accused the other of tanking negotiations, leaving them locked in a standoff with no clear end in sight.
Some industries, such as dairy, hope the tariffs bring Ottawa back to the bargaining table to negotiate a better deal under the U.S.-Mexico-Canada Agreement, the trade pact that entered into force in 2020 and is undergoing formal review.
However, they are skeptical that permanent tariffs would solve the trade fight.
“The end goal isn’t to be having these bans or very high tariffs on Canadian imports in place long term,” said Shawna Morris, executive vice president of trade policy and global affairs for the National Milk Producers Federation.
“They are an important leverage tool, and we had Canadians game-playing on their USMCA dairy market commitments for years and just a refusal to address the issue. I think that left the administration with no choice but to try to look for other tools to shake things up and drive negotiations forward in a more productive way,” she said.
Ms. Morris said tariffs have not been in place long enough to measure their impact on dairy producers.
Tariffs are duties imposed on foreign goods brought into U.S. markets.
They have been used for centuries to protect domestic industries. Mr. Trump supercharged their importance by making them the central plank of his trade agenda.
Critics say the tariffs raise prices as importers pass along the cost of duties and should not be used as a blanket punishment on foreign sectors.
That makes tariffs a sensitive topic for some.
“It’s a bad look to cheerlead for the tariffs. When [industries] do, it’s usually couched in some sort of fairness argument. Sometimes, the steel industry will make this argument, but that’s usually against countries like China, not Canada,” said Wayne Winegarden, a senior fellow in economics at the Pacific Research Institute.
A major lobby for U.S. distillers said it hopes Mr. Trump’s ban on Canadian alcohol imports leads to a positive resolution for both nations rather than a bitter cycle of revenge.
Chris Swonger, president and CEO of the Distilled Spirits Council of the United States, said U.S. spirits exports to Canada fell by more than 70% when Canadian provinces pulled American liquor from their shelves.
“We know firsthand the damage these measures can cause, and we do not wish to see Canadian distillers face similar hardship,” Mr. Swonger said. “We are hopeful that this action will bring both governments back to the negotiating table before the ban on Canadian spirits imports takes effect.
“We urge leaders on both sides of the border to reach a resolution that restores U.S. spirits to retail shelves throughout Canada and returns the spirits sector to a permanent zero-for-zero tariff framework.”
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