Major Canadian industries remain under "punishing" US trade terms, even after the US Supreme Court ruling that throws out most tariffs imposed by President Donald Trump in the past year, according to government and industry groups.
Trump does not have the power to impose tariffs under the International Emergency Economic Powers Act (IEEPA), according to the Supreme Court's decision released on Friday, a blow to his strategy for extracting concessions from trading partners.
The US-Mexico-Canada (USMCA) trade agreement has shielded over 98pc of Canada's goods from tariffs, according to Canada's Trade Commissioner Service. But in addition to the now-defunct US tariffs issued last year, Trump used Section 232 of the 1962 US Trade Expansion Act to impose 50pc tariffs on steel and aluminum, 25pc tariffs on automobiles and automotive parts while also increasing tariffs on softwood lumber and derivative products to 45pc.
Canadian autoworker union Unifor said the Supreme Court's decision should not be mistaken for a victory.
"The ruling does not end the US trade war against Canada," Unifor president Lana Payne said on Friday.
Following the ruling on Friday, Trump vowed to replace the tariffs with harsher measures through other means.
"Canada should prepare for new, blunter mechanisms to be used to reassert trade pressure, potentially with broader and more disruptive effects," said Canadian Chamber of Commerce president Candace Laing. "This is certainly not the last chapter of this never-ending story."
A joint review of USMCA is scheduled for July, where the three countries will either agree to extend the agreement for a new 16-year term, or let it expire in 2036. Canadian prime minister Mark Carney on 28 January said Canada has finished its own internal review of the deal.
Canada wants to create growth on both sides of the border but is simultaneously pursuing more trade with "reliable" partners, according to Canada's minister responsible for Canada-US Trade Domonic LeBlanc.
Canada's exports to non-US countries hit a record C$21bn in December, up by a staggering 30pc from the same month of 2024. While each trade partner is still relatively small compared to the US, growing exports to the UK, EU and China have partially absorbed some of the declines to the US.
Canadian exports to the US tallied C$556bn across 2025, down by 6pc from the C$590bn in full-year 2024. Imports from the US came in at C$474bn in 2025, down 3pc from the C$489bn in 2024. The resulting trade surplus was C$82bn, down 19pc from the C$101bn in 2024.
