Canada faces a summer of shortages even after Mark Carney's victory, here's the reason behind it

Mark Carney, the new Prime Minister, may have secured a major victory in the federal election, but that hasn't stopped what's coming—a summer of shortages. From grocery store shelves looking emptier to prices spiking on everyday essentials, the story isn’t just about leadership—it’s about survival in the face of a trade war with the United States.

The root of the crisis? A sudden tariff war with President Donald Trump’s administration, and it's already sending shockwaves through Canadian industries, households, and even liquor stores.

Why are U.S. and Canadian shelves suddenly going empty?

Tariffs are doing more than just raising prices — they’re creating real gaps in supply. For instance, shipping traffic from China has plummeted by up to 60%, especially in U.S. ports like Los Angeles and Long Beach. Retailers like Canadian Tire, Walmart, and Home Depot are stuck deciding whether to absorb the massive costs or leave products at the docks. Most are choosing the latter.

Trump’s tariff policy is hitting Canada and the U.S. equally hard. Many of the everyday products people rely on — from diapers to microwaves — come from countries like China, Vietnam, and Bangladesh. Now, those same countries are facing massive U.S. tariffs:

• China: Up to 145% on imports
  
• Vietnam: 46–49% tariffs
  
• Bangladesh: 37% on U.S. exports
  

That’s a huge leap from last year and, according to Torsten Slok, chief economist at Apollo Global Management, it could mean “COVID-like shortages for consumers and for firms using Chinese products.” He warns that U.S. stores could face widespread empty shelves within weeks.

Why is Trump’s tariff war hitting Canadian shelves so hard?

President Donald Trump launched a sweeping trade move in March 2025, slapping a 25% tariff on nearly all Canadian imports—except energy, which still faces a 10% levy. The U.S. justified the tariffs by pointing to trade deficits and issues around border enforcement tied to immigration and drug trafficking.

In response, Canada fired back with its own tariffs. Prime Minister Mark Carney announced matching duties on $30 billion worth of American goods, with plans to hit another $125 billion worth of products. That includes U.S.-made cars, food items, steel, and more. The tariffs have tangled North American supply chains, and now we’re seeing the fallout in stores and factories.

What does this mean for the Canadian economy this summer?

The numbers paint a grim picture. Canada sends about 75% of its exports to the United States. With these new tariffs in place, economists are warning of a slowdown. GDP could shrink by up to 2.5% by early 2026. Inflation might rise to 7.2% by mid-2025. And unemployment? It’s expected to climb to 7.9% by the end of the year—meaning 150,000 Canadians could lose their jobs.

Business sentiment is already showing signs of distress. The latest S&P Global PMI data shows Canada's services sector has shrunk for five straight months. In April, the services index fell to 41.5. That’s far below the 50-point level that signals growth. Meanwhile, manufacturing dropped too—falling to 45.3 from 46.3 in March.

What kind of products are at risk because of Trump’s tariffs?

The products most at risk include low-cost household items and big-ticket goods alike. According to retailers and economic experts, here’s what we might soon see disappearing from shelves:

• Everyday items: Clothing, diapers, infant formula, utensils, tools, and toys
  
• Electronics and appliances: Flat-screen TVs, washers, dryers, kitchen gadgets
  
• Furniture: Especially from Vietnam, now hit with nearly 50% tariffs
  
• Solar panels: China is the top global supplier, and the tariffs make them much pricier
  
• Groceries and food: Canadian supply is stable for domestic food, but imported products — especially those passing through the U.S. from Mexico or Central America — could face delays or shortages
  

Even big companies are worried. CEOs from Walmart, Home Depot, and Target recently visited the White House, warning President Trump that his aggressive trade policies could leave their stores with large gaps in stock. Their message was clear: customers will soon feel the impact.

Are any businesses or states fighting back against Trump’s trade policy?

Yes, the backlash is growing fast. On April 23, a group of 12 U.S. states, including New York and Illinois, filed lawsuits challenging Trump’s trade moves. Lawsuits against the administration have often been successful in the past — and many are hoping this will offer some relief from the looming shortages.

One small business, Learning Resources — a toy manufacturer in Vernon Hills, Illinois — is facing a devastating increase in import costs due to the tariffs. Last year, their duties were $2.3 million. This year? $100 million. CEO Rick Woldenberg calls the tariff hikes “catastrophic,” adding, “There are people that believe in ghosts, OK?” when asked about Trump’s belief that factories can easily return to the U.S.

Experts and economists agree that Trump’s goal — to force companies to bring factories back to American soil — is unrealistic. Not only would it cost billions, but there’s also a labor shortage in the U.S. for the kind of low-wage jobs that overseas factories currently handle.

Could Canada see even more damage if Trump keeps going?

Yes, and it’s already making political waves. Ontario Premier Doug Ford has spoken out strongly against the U.S. President. Trump has hinted at raising tariffs on the Ontario-based auto sector, which Ford believes could put 500,000 Canadian jobs at risk.

Ford didn’t hold back in his criticism, saying, “I think the cheese slips off the cracker with this guy.” His message is shared by many Canadian business leaders and consumers now bracing for months of uncertainty.

Trump’s pattern of slapping on, pausing, then doubling tariffs has created chaos for global trade. Businesses don’t know how to plan, and supply chains are breaking under the pressure.

Is there any end in sight for this trade war?

Right now, the outlook is uncertain. Lawsuits could slow down or reverse some of Trump’s tariff moves, but the damage may already be done for many businesses and consumers. With prices rising, products disappearing, and trade routes disrupted, this tariff war is becoming more than a political move — it’s turning into a full-blown crisis for North America’s supply chain.

How is Mark Carney responding to the U.S. tariffs?

Carney hasn’t wasted time. Right after taking office, he declared that Canada’s tariffs will stay in place unless the U.S. shows “respect” for fair trade. He’s also pushing to cut Canada’s reliance on American trade altogether.

Carney is focusing on strengthening economic ties with the EU, the UK, and countries across Asia. At home, he’s doubling down on economic nationalism. His team has launched the “Buy Beaver” campaign and “Maple Scan” app, helping Canadians identify and support locally made products.

Even provincial liquor boards have joined the movement—many have stopped selling American alcoholic beverages altogether.

How are Canadians reacting to the U.S. trade standoff?

The backlash against the U.S. is growing fast. A recent survey shows that 91% of Canadians support reducing trade ties with the U.S. Many have started boycotting American goods, travel, and services altogether.

This nationalist mood helped fuel Carney’s landslide win during the Liberal Party leadership race. Canadians are rallying behind leaders who promise to stand up to the U.S., even if it means short-term economic pain.

What’s next for Canada as shortages and inflation grow?

Even with Mark Carney at the helm, the road ahead looks tough. The trade war isn’t cooling down anytime soon, and its effects will only deepen as summer rolls in. Shoppers are likely to see more empty shelves. Businesses will keep dealing with delayed shipments and higher costs. And the average Canadian may feel the pinch every time they check out at the grocery store.

Still, Carney is betting that long-term change—through diversified trade, domestic production, and national unity—will help Canada weather the storm. But for now, the story remains about shortages, tariffs, and a country bracing for an uncertain summer.

FAQs:

Q1: Why are Trump’s tariffs causing product shortages in the U.S. and Canada?
Because high import tariffs are making goods too expensive, so retailers aren’t bringing them in.

Q2: What products are most affected by Trump’s tariff policy?
Items like furniture, toys, appliances, and clothes are among the hardest hit due to heavy tariffs.