Cans of Canadian Molson beer sit on a shelf at the Liquor Control Board of Ontario (LCBO) Queen’s Quay store on Tuesday, March 4, 2025 in Toronto, Ontario, Canada.
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As diplomatic and trade relations with Ottawa continue to deteriorate, the White House announced a ban on imports of Canadian motorcycles and a number of other products starting later this month.
Late Monday, US President Donald Trump announced a ban on a number of alcoholic beverages, including Canadian whey products and molasses, non-alcoholic beer, and malt beer, wine, cider, whiskey, vodka and other spirits, using a series of executive orders. Large motorcycles and mopeds are also prohibited.
The import restrictions primarily replace a 50% tariff and are scheduled to take effect on September 29, 2026.
The U.S. also announced that it would amend and extend tariffs on other Canadian products starting Sept. 15, including adding all-terrain vehicles and animal skins and removing rock salt and cement.
U.S. Trade Representative Jamison Greer said the move was “the natural result of Canada’s continued discriminatory treatment of important U.S. exports.”
On the same day, it was announced that tariffs on C$27.6 billion of Canadian imports to the United States went into effect, targeting more than 700 items including steel, dairy products, agricultural equipment, pulp and paper, and electronics.
Ottawa previously said it was a “dollar-for-dollar” response to the 50% tariffs the United States imposed on its products in August, after trade talks collapsed just before the Aug. 21 deadline.
Both countries have continued to blame each other for failing to reach an agreement and have accused the other of unfair practices that harm domestic workers.
President Trump has accused Canada of undermining U.S. exports through policies in the auto, alcohol and dairy sectors, highlighted the U.S. trade deficit in goods, and threatened to impose 50% tariffs on cars, trucks and auto parts starting January 1, 2027.
In a speech in August, Canadian Prime Minister Mark Carney said, “The reason we have a narrow goods trade deficit is only because the United States buys a lot of energy,” emphasizing that Canada is the largest consumer of American automobiles and steel.
He also said the U.S. had “asked too much” in trade negotiations and said retaliation was necessary to protect Canadian workers and businesses, even if it meant economic damage and fewer choices for consumers.
Current tariffs apply to a relatively small portion of the $715.5 billion in goods trade between the two countries, but economists warn of immediate damage to small businesses and risks to growth from further expansion.
“Companies on both sides of the border will have to wait and see whether tariffs remain in place, further measures are enacted, or whether countries decide to ease them,” said Justin Angotti, an associate in the international trade and national security group at law firm Reed Smith. “In the meantime, these companies will realize both the costs associated with tariffs, compliance, and uncertainty.”
Meanwhile, Ottawa is eyeing closer trade and security ties with the European Union as relations with Washington deteriorate, Bloomberg reported Tuesday.
alcohol war
As relations between the United States and Canada deteriorate, beer and spirits sales have emerged as a political flashpoint.
Stores in several Canadian provinces have pulled U.S.-made alcohol from shelves, a national movement has called for boycotts, and Saskatchewan Premier Scott Moe announced in August that he would impose a 50 per cent tariff on U.S. imports.
Moe’s team told CNBC this week that the alcohol tax is a “mutual measure” aimed at supporting local businesses and promoting progress toward a fair and balanced trade solution.
According to the U.S. Distilled Spirits Council, U.S. spirits exports to Canada fell more than 70% year over year from March 2025, when the ban on retaliation began, to December 2025.
Chris Swonger, president and CEO of the trade association, said U.S. distillers are “bearing the brunt of this trade dispute.”
“We appreciate President Trump’s recognition of the significant harm these bans have inflicted on U.S. distillers, and we call on leaders on both sides of the border to reach a negotiated solution that restores U.S. spirits to retailers across Canada and returns the spirits sector to a permanent zero-for-zero tariff framework,” Swonger said.
