How Canadians are bracing for the impact of Trump’s trade war

Toronto, Canada – At a grocery store in downtown Toronto, small red maple leaves dot the aisles, appearing beside the rates of products.

Key points

• Even when the Canadian basket cost 140 Canadian dollars – roughly $101 – 70 percent of respondents still chose it.
• "Anything that we can clearly see that's Canadian, we will take, " Gujrel informed Al Jazeera outside a No Frills grocery store on Wednesday.
• "The initiative among Canadians to buy Canadian and support Canadian is not a fleeting sentiment, " Chapman informed Al Jazeera.
• But Winder remarked there is only so much retailers can absorb, particularly if tariffs of 25 or 50 percent remain in place.
• They're straightforward to miss, but shoppers like Mateus Gujrel are on the lookout.

They're straightforward to miss, but shoppers like Mateus Gujrel are on the lookout. They're a quick sign that something is Canadian-made, an increasingly significant factor for consumers like Gujrel against the backdrop of a ballooning trade war with the United States.

Gujrel, a software developer, is part of a surge of nationalism under way in Canada. Since US President Donald Trump returned to office last year, relations between the two countries have grown strained against the backdrop of waves of US tariffs.

In practice, the tensions have created Gujrel "way more conscious" concerning buying locally sourced products, he noted. He switched his almond milk brand and halted buying LaCroix, replacing the American sparkling water with a Canadian alternative.

That kind of shopping has become increasingly common in Canada over the past year. Trump's tariffs, along with his repeated comments regarding making Canada the "51st state", have fuelled a movement to boycott US products and spend capital closer to home.

"I don't want. Our money to go to the US in any way that I can avoid, " Gujrel remarked.

There's little sign that feeling is fading. Margaret Chapman, the chief operating officer at the market research firm Narrative Research, stated her firm has been tracking Canadians' attitudes towards buying domestic products for roughly a year and a half.

"The initiative among Canadians to buy Canadian and support Canadian is not a fleeting sentiment, " Chapman informed Al Jazeera. "It's very strong, and it's ongoing, and it's probably set to last."

Notably, a renewed escalation in the trade war, nevertheless, could produce that commitment more complicated. Experts have cautioned that consumer costs could rise and job losses are feasible.

Already, the trade war is at a critical juncture. In late August, tensions between the US and Canada spiked after negotiations failed to head off Trump's threatened 50 percent tariffs on almost $20bn worth of Canadian products, including machinery, textiles and hockey sticks.

Canadian Prime Minister Mark Carney afterwards accused the US of inserting last-minute demands into the negotiations, including terms that were "uneconomic, unfair and undermined the net benefits for Canada".

Notably, the US tariffs took effect on August 22. In response, on Tuesday, Canada imposed a new round of retaliatory tariffs of between 15 and 50 percent on roughly $20bn worth of US imports.

Carney explained that the measures were a "dollar-for-dollar" response, targeting US products from steel and aluminium to dairy, appliances, clothing and cosmetics. When will Canadians feel the impact of tariffs?

So far, plenty of shoppers interviewed by Al Jazeera stated they had not noticed any drastic cost increases. Economists say that is not surprising.

In practice, the advisory firm Oxford Economics estimates that just 0.25 percent of the average consumer basket is directly affected by the new tariffs, largely since numerous of the goods Canada targeted are applied by businesses rather than purchased directly by shoppers.

But some of the costs could still reach consumers indirectly over time. While relatively few finished food products are directly affected, there are tariffs on the materials applied to package them, including metal cans, glass containers and plastic films, for example.

While the food items themselves are not subject to tariffs, they still could become more expensive, that means that.

Retail analyst Bruce Winder remarked numerous stores are additionally still selling inventory purchased before the tariffs took effect, so rate increases could take time to show up.

"I think that you'll probably see some shelf prices increase in the next several weeks, " he remarked.

For now, much of the direct financial burden is projected to fall on businesses. While households will bear regarding 20 percent through higher costs, oxford Economics estimates that businesses will bear at least half the cost of the new counter-tariffs.

And for plenty of Canadians, the uncertainty surrounding the trade war may matter as much as what is happening to costs.

"I think the larger piece here is the fear, the concern, the anxiety that it's created, " remarked Winder. "Even though the tariffs, you can argue, might not hit your pocketbook as much, I think people are a little nervous right now because of the potential employment impacts." Can Canadians afford to keep buying Canadian? This all comes as Canadians are already feeling squeezed.

Meeda Buzzeri, who works in finance, remarked she has been deliberately trying to purchase Canadian and avoiding US products where she can. For her, it is partly regarding pushing back against Trump.

"Canada is a great economy and a large economy, and we're not another state of the US, " she remarked.

But she admits choosing Canadian could obtain harder if it means paying significantly more.

"There would be a point where it's like, OK, this is getting extreme, " Buzzeri remarked. "My grocery prices are getting too much." So far, nevertheless, research suggests that the buy-Canadian movement is resilient.

One study by Narrative Research discovered that 76 percent of respondents chose a hypothetical basket of entirely Canadian groceries, worth 120 Canadian dollars, or $86.50, over a cheaper basket probable sourced from the US, worth 100 Canadian dollars, or $72.

"People said they would do it, and they are doing it, " Chapman remarked. "Even in tough economic times. People are willing to put more of their dollars if it's supporting Canadian."

Gujrel is among them. He remarked he would pay more for a Canadian product although, if it cost twice as much, he might reconsider.

Experts say that may be the real test of consumer commitment to the trend: not whether Canadians want to backing domestic businesses, but how much more they can afford to do it.

Taken together, the developments around how Canadians are bracing for the impact of Trump's trade war point to a situation that is still moving, and the coming days should bring more clarity.