Despite tariffs, trade with Canada has remained largely unchanged for North Carolina, with exceptions for certain commodities, according to year-to-date data from the Economic Development Partnership of North Carolina (EDPNC).
“Year-to-date (YTD) through July, trade with Canada has been relatively stable compared to last year, despite a 25% tariff being implemented on most Canadian imports in the Spring of this year and Canada implementing its own retaliatory tariffs,” Joseph Harris, fiscal policy analyst for the John Locke Foundation, told the Carolina Journal.
Canada has been the largest purchaser of North Carolina exports in the world for over a decade. This trend continuing into 2025, with just over $5 billion in North Carolina exports purchased by Canadians YTD.
While tariffs have had a minimal impact on trade with Canada, certain commodities have experienced significant changes. Animal and vegetable fat exports to Canada have risen 98.4% year-to-date. Vehicles and meat exports have also posted substantial gains, each increasing by roughly 75%. In contrast, aircraft and aircraft parts have seen the steepest decline, falling 54.7% over the same period.
The three most substantial exports to Canada, measured by total value year-to-date rather than percentage growth, are nuclear reactors, boilers, machinery, and mechanical appliances (including their parts); pharmaceutical products; and vehicles other than railway or tramway rolling stock, along with their associated parts and accessories, according to data from the EDPNC.
According to year-to-date data from the EDPNC, Canadian imports into North Carolina rank sixth among countries, at about $2.8 billion.
On the import side, the three most substantial are nuclear reactors, boilers, machinery, and mechanical appliances (including their parts); plastics and articles made from plastics; and natural or cultured pearls, precious or semi-precious stones, precious metals, metals clad with precious metal, and related articles, including imitation jewelry and coins, according to EDPNC data.
“Imports of Canadian precious stones and metals have increased a jarring 4,424.2% year-to-date from $4.4 million to $200.5 million,” said Harris. “On the other hand, imports of organic chemicals from Canada have plummeted 93.3% from $176.4 million to $11.9 million.”
As noted from the charts, exports to Canada of aircraft, spacecraft, and parts thereof have dropped by more than 50% according to year-to-date data from the EDPNC. At the same time, imports of the same commodity have also dropped by 75%. This collapse comes as tariffs on steel and aluminum were implemented earlier this summer. Steel and aluminum, excluding automobiles and auto parts, are subject to a 50% tariff, with the exception of the UK, which is subject to a 25% tariff.
This tariff impacts: “All steel and aluminum products that are not ‘“’melted and poured’”’ in the US, including derivatives and downstream goods.” Automobiles and auto parts are subject to a separate 25% tariff.
While aircraft and aircraft parts are not currently tariffed as a commodity, a separate tariff is being considered, but it would not be enacted until January 2026.
As of Aug. 1, the tariff rate on most Canadian imports was increased from 25% to 35% in an effort by the Trump administration to hold Canada accountable for its alleged continued role in the fentanyl crisis. Making it even more vital to continue to monitor the impact of tariffs on trade with North Carolina’s most valuable customer, Canada.