Trump's Ban on Canadian Bev/Al Takes Effect

Checkmate. Some 87% of President Trump's ban on $967 million of Canadian imports are alcohol beverages. Also banned effective midnight Tuesday (9/28) are some dairy products and motorcycles.

President Trump's tariff chess match with Canada thus far:

• In the Spring of 2025, Trump imposed significant tariffs on Canadian goods.
• Several Canadian provinces, including Ontario, retaliated in March 2025 by banning the sale of American wines, beers and spirits. This was intended to be a political message against the tariffs and in support of local industries. The result: U.S. producers experienced severe export declines. U.S. spirits exports to Canada fell 70% to $72 million from $232 million, while U.S. wine exports to Canada declined by 87%, dropping to just $60 million from $456 million .
• After losing a case at the U.S. Supreme Court earlier this year, Trump turned to a Depression-era statute to impose 50% tariffs on about $20 billion of Canadian goods, including alcohol. He charged Canada discriminates against U.S. alcohol beverage, dairy and auto producers.
• Canada counterpunched with tariffs of 15%, 25% or 50%, matching the U.S. imposts dollar-for-dollar.
• To punish Canada for retaliating, Trump decided to ban several Canadian products, including alcoholic beverages, effective 12:01 a.m. Eastern time Tuesday. This may have a significant impact on Canadian producers: In 2025, the U.S. accounted for 93% of total Canadian spirits exports.

The Toasts Not Tariffs Coalition warned, "this new ban will ripple throughout the U.S. hospitality sector at a time when restaurants, bars and retailers are preparing for the busy holiday season.

"The best outcome remains a negotiated solution that gets American spirits and wine products back on Canadian shelves, preserves consumer choice for consumers on both sides of the border and allows U.S. and Canadian hospitality businesses to focus on growth rather than becoming collateral damage in a trade dispute beyond their control."

Because of a gigantic loophole in the ban, independent distillers and brewers are expected to bear the brunt of the ban. Wolfhead Distillery, in Amherstburg, Ont., across the Detroit River had buyers in Georgia interested in importing its Coffee Whiskey. Its Michigan importer was considering in Vanilla Almond Miscotti and Banana Caramel Vodka.

Who Moves Next?

“This marks yet another escalation in the trade war that may result in further retaliation on the Canadian side,” Jacob Jensen, director of trade policy at the center-right American Action Forum think tank, told the Associated Press. He expects Canadian exporters and U.S. importers “impacted by these bans will be highly motivated’’ to demand that trade officials on both sides find some way to reach a “resolution of this whole ordeal.’’

Don't be too sure that will be successful. Canadian Prime Minister Mark Carney has made no secret he intends to reduce Canada's dependence on the U.S. He says he wants to double Canada's non-U.S. trade in the next 10 years. “There is now a price to be paid for access to the United States market," he says.

He's working to become the first "associate member: of the European Union, negotiating a trade deal with India which he expects to conclude at the G20 summit in December, and struck a deal with China to allow a limited number of Chinese electric vehicles into Canada.

“Our first priority remains on protecting and supporting Canadian workers, farmers, families, and businesses from these unjustified actions," said Gabriel Brunet, a spokesperson for Canada-U.S. Trade Minister Dominic LeBlanc. "Our core focus is on what we can control: building strength at home, diversifying our partnerships abroad, and building Canada strong for all Canadians.”

Trump expects Canada to cave. “They’re gonna come in and they’re gonna say, ‘Sir, we are sorry,’” he told reporters Monday. “They’ve treated the United States very, very badly. I think a deal will be made but it’s gonna be fair.”

Carney said “Canada stands ready to negotiate in good faith” toward “a mutually advantageous trade arrangement that respects both our countries’ sovereignty.” But asked if there might be further Canadian retaliation, Carney responded he would "never rule anything out."

Bottom line: The standoff is likely to continue for months, trade attorney Patrick Childress, a partner at Holland & Knight and a former U.S. trade official, said. The tariffs “probably won’t cause enough economic upheaval to force either party back to the negotiating table,’’