Destroy more of america...

Businesses brace for impact as Trump's 50% tariff on Canada draws closer

by Richard Haller

The scent of white pine sawdust, diesel fumes and cedar sap hangs in the air at a lumber yard in Rensselaer Falls, NY, fifteen miles south of the Canadian border. 

Two men in their 20s, Matthew Morse and Austin Kennedy, are loading narrow white pine boards onto the forks of a small Cat loading machine and slipping thin strips of wood between the boards to create air gaps that prevent warping and mold, a process called stickering.

JP Building Supply stores and sells all types of building materials and lumber and gets "about a third" of its supply from Canada. That includes sheathing like plywood, which is threatened with a tariff that could double the import cost. 

On July 20, President Donald Trump imposed 50% tariffs on many Canadian goods, from dairy and alcohol to motor vehicles to building materials like plywood, kitchen cabinets, and cement. They’ll take effect Aug. 19 unless the countries strike a deal before that date. 

As he straps down a bundle of white pine with a ratchet strap, Morse said he's "not concerned about the tariffs himself." 

"It allows for more commerce in the country and not outsourcing to other countries," said Morse. "You know what I'm saying? It's time to give our own companies business."

This sentiment is one of President Donald Trump's arguments for imposing these tariffs: that they'll drive more local business within the U.S.

But JP Building Supply owner James Putman said that if these tariffs really do move forward, they're "in trouble." 

"That’s going to affect us tremendously. If things bump up 50%, we have to add on 50% because we’ve got to put it onto the customer. And that’s just going to push everything else up."

That's despite his business growing and doing well, said Putman. 

Tariff impacts

For the past year and a half, the Trump Administration has aggressively targeted Canada with tariffs, arguing that the country has treated trade with the U.S. unfairly. But the Supreme Court ruled in February that Trump didn’t have the authority to impose certain tariffs by executive order; the government has refunded around $100 billion in tariff earnings so far. Now, it’s imposing new tariffs under Section 338 of the Tariff Act of 1930. Trump is the first U.S. president to invoke this provision.

According to CBC, Canadian officials are mapping out a trade deal to pitch to the Trump Administration early next week to try and avoid these new tariffs. 

Across the border in Canada, Hank Vedder is a reclaimed lumber sales manager at a lumber business in Ottawa called WoodSource that ships 60% of its product to the U.S. He said the threat of these tariffs alone is already impacting U.S. customers like home builders and contractors.    

"They say, 'Hey, if that 50% is coming in, I need to do one of two things. I'm going to either order today before the tariffs kick in, or then I'm going to wait until there's relief in those tariffs.'" 

Vedder said these tariffs are causing a domino effect—raising import costs on specific items, which then pushes companies to raise all their prices.

"So then that affects the contractor because he's trying to get this house built on time for his customer. And then that affects the supply chain because if the contractor is not ordering the material, then the supply chain is weakened."

Vedder said he's lost substantial U.S. customers, and that "the tariffs are making or breaking it." He said that if the 50% tariffs go into effect, regular consumers will pay the price.

"So when that price comes through, because it is a consumer-driven economy, it's the consumer that pays the tariff," said Vedder. "So, regardless of where you live in the world, you're the one who's going to be swallowing the tariffs. Businesses will maybe try to absorb some of it, but at the end of the day, they just can't."

In central New York, dairy farmer A.J. Wormuth owns Half Full Dairy and also chairs the Northeast Dairy Producers Association. He said he hopes the new 50% tariffs apply enough pressure to help both sides reach a better deal to restore the United States-Mexico-Canada-Agreement (USMCA). But he said existing tariffs—like on steel and aluminum—stacked with the uncertainty of whether these new tariffs will happen, have already "created economic pressure."