Tariff-hit industries struggling as trade war drags into second year

From rolled steel to kitchen cabinets, Canadian businesses hit by targeted U.S. tariffs are struggling to respond as the trade war drags into its second year.

While most exports continue to flow tariff-free under the Canada-U.S.-Mexico trade agreement, industries like metal production, lumber and automobiles continue to face steep duties more than a year after U.S. President Donald Trump upended the global status quo. Companies have cut staff, pulled back on production and pushed for government action as the heavy duties continue to shake the crucial and long-standing trade relationship with the U.S.

Take Daniel Drapeau, CEO of Quebec-based custom cabinet maker Miralis. His company has invested $43 million since 2022 as it built two plants, with plenty of automation to boost productivity, but like so many others in the industry, it’s now operating well below capacity.

The problem, like with other sectors hit by the Section 232 tariffs, is not only the loss of the U.S. market, but that all the other countries blocked from the world’s largest economy are also looking for buyers, leading many to try and sell more into Canada.

“We were ready to grow after all those crises,” Drapeau said in an interview, citing the COVID-19 pandemic, interest rates and inflation.

“But now we’re being hit by the fact that there is a surge. There is too much product coming from other countries.”