The United States has widened its trade measures against Canada, banning imports of alcohol, dairy products and motorcycles while raising duties on several other Canadian goods.
President Donald Trump announced the restrictions through executive orders on Tuesday, accusing Canada of “discriminating” against American businesses. The new import ban is set to take effect on September 29.
The move came as Canada began enforcing retaliatory tariffs on US products, including steel, clothing and furniture, after midnight on Tuesday.
Canadian Prime Minister Mark Carney said the decision to reduce the country’s dependence on the US as its biggest trading partner “will come at a cost”.
Washington and Ottawa have both expressed interest in reaching a trade agreement, but they have not scheduled new negotiations since talks broke down in late August.
The latest measures add to a trade dispute that has strained relations between the two countries, which have long been close allies and major commercial partners.
More than two-thirds of Canada’s exports generally go to the US, while Canada remains America’s second-largest trading partner after Mexico. US exports, however, are spread across a wider range of markets.
Businesses in both countries have warned that the dispute could push up prices and reduce the number of customers.
The White House last month imposed 50% tariffs on about $20 billion worth of Canadian goods following several failed rounds of negotiations. The duties affected industries including furniture, wine, sporting equipment and fishing supplies.
Canada answered with matching tariffs on American goods, further widening the dispute.
Under the latest US restrictions, whey, non-alcoholic beer and certain wine, rum and vodka products will be barred from entering the country. Malt beer and motorcycles, including mopeds, are also affected.
Other Canadian products will face increased import taxes, including various cheeses, raw hides and skins, paper, furniture, mattresses, aluminium, iron, motorboats, golf carts, fishing rod parts and accessories, and switchboards.
The White House said Canada was placing restrictions on American products while allowing similar goods from other countries, which it said amounted to discrimination against US businesses.
Trump also warned of possible further action against Canada. On Monday, he told aircraft manufacturer Bombardier that it would lose access to the US market unless it shifts manufacturing to the United States.
Trump has repeatedly argued that tariffs can help address trade imbalances, although his wider tariff campaign has caused concern among several traditional US allies.
The dispute has also triggered a boycott of American products in Canada, with US alcohol among the goods that have disappeared from some store shelves.
Deborah Elms, a trade expert at the Hinrich Foundation, said the new restrictions could have a “strong” effect on Canadian companies that depend on US customers. However, early estimates put the affected goods at about $1 billion, suggesting a modest overall impact.
Elms said Canada would likely “hold course for now” while adjusting support for businesses affected by the new US measures.
“The bigger question is what it will take for the two sides to sit back down together. The language in these proclamations, as an example, isn't helpful in getting to the negotiating table,” she said.
Carney defended Canada’s response as the counter-tariffs took effect, saying: “There's always a cost to action. But it doesn't come close to the cost of standing still.”
The dispute has spilled beyond trade, with Trump in August ordering Lake Ontario to be renamed Lake America, sparking anger among Canadians and criticism from some people in the US