Trump raises Canada aluminum tariffs to 35% amid trade tensions

President Donald Trump has significantly escalated tariffs on imports from Canada, increasing the rate on certain aluminum products from 25% to 35% effective July 30. This decision was announced via an executive order and reflects a broader shift in U.S. trade policy, as the administration imposes new tariff rates on multiple countries ranging from 10% to 40% [1]. The move followed a breakdown in high-level trade negotiations between the U.S. and Canada, with the White House citing Canada’s failure to curb the flow of illicit drugs, particularly fentanyl, into the U.S. [2].

The Canadian government has not yet responded publicly, but sources indicate the Trade Ministry is preparing possible retaliatory measures. Analysts suggest that the tit-for-tat approach could further strain the relationship between two of the world’s largest trading partners [3]. In 2024, the U.S. imported $475 billion worth of Canadian goods and services, while exporting $440 billion, with the USMCA framework offering some protection to key sectors such as automotive and manufacturing [4]. Despite the escalation, goods traded under USMCA remain exempt from the new tariffs, sparing these industries from immediate disruption [5].

The Trump administration’s new tariff strategy extends beyond Canada, targeting trade surpluses by imposing minimum rates of 10% on global imports, with higher levies on countries such as India (25%), Taiwan (20%), and Switzerland (39%). Southeast Asian nations like Thailand and Cambodia also face tariffs of 19% despite last-minute diplomatic efforts [6]. Notably, the U.S. has introduced a 40% tariff on goods suspected of being transshipped to avoid existing duties, though the order lacks clarity on how transshipping will be defined [7].

The timing of the tariff increases appears strategic, coming ahead of a self-imposed deadline for finalizing trade agreements. While the Canada tariff was enacted immediately, others will take effect in seven days, allowing for a grace period for shipments already in transit. Mexico was granted a 90-day reprieve, maintaining its current 25% tariff following a recent diplomatic call [8]. Financial markets have thus far shown limited reaction, with the Canadian dollar and South African rand showing minimal movement in early Asian trading [9].

The broader impact of these changes is expected to be significant, with businesses facing higher import costs and potential supply chain disruptions. Analysts note that the administration has not provided internal economic projections, leaving the long-term consequences uncertain [10]. The revised tariff structure underscores Trump’s continued emphasis on protecting domestic industries while leveraging U.S. economic influence globally. However, the administration’s refusal to release detailed impact assessments raises questions about the sustainability of this approach in the long term [11].

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Source: [1] Trump hikes tariffs on Canada to 35%, announces new rates from 15% to 40% for dozens of countries. (https://finance.yahoo.com/news/trump-hikes-tariffs-on-canada-to-35-announces-new-rates-from-15-to-40-for-dozens-of-countries-000338948.html)

[2] Trump tariff updates: Canada tariff raised to 35%. (https://www.bbc.com/news/live/cpqvdxzwv22t)

[3] Trump hikes tariffs on Canada to 35%, announces rates ... (https://finance.yahoo.com/news/trump-hikes-tariffs-on-canada-to-35-announces-rates-from-10-to-40-for-dozens-of-countries-000338109.html)

[4] Trump signs order increasing tariffs on Canadian goods ... (https://www.theguardian.com/us-news/2025/jul/31/trump-canada-tariffs-order)

[5] Trump's trade deadline ticks down to zero, sending tariffs ... (https://www.cnn.com/business/live-news/trade-deadline-tariffs-trump-deals)

[6] Trump announces sharper tariffs take effect in a week ... (https://www.washingtonpost.com/business/2025/07/31/trump-tariffs-face-legal-challenge/)

[7] Trump increases tariff on Canada to 35% from 25%, cites ... (https://m.economictimes.com/news/international/global-trends/trump-increases-tariff-on-canada-to-35-from-25-cites-fentanyl-ahead-of-august-1-deadline/articleshow/123032110.cms)

[8] Trump Sets Baseline Tariff Rate of 10%, Hikes Levy on ... (https://www.bloomberg.com/news/live-blog/2025-07-31/us-tariff-deadline)

[9] Trump's Shocking Tariff Hike on Canada and Other Countries. (https://www.travelandtourworld.com/news/article/trumps-shocking-tariff-hike-on-canada-and-other-countries-trade-war-reaches-explosive-new-heights/)

[10] Trump hikes Canada tariff to 35% as he unveils new global trade levies. (https://coinmarketcap.com/community/articles/688c12b70250c1742bc7690e/)