Trade war updates: Trump boosts tariffs on Canada after Ontario hikes electricity prices; EU retaliates against US

Canada and the European Union (EU) will soon slap new tariffs on exports to the U.S., government officials said Wednesday.

The Associated Press reports Canada will soon announce more than $20 billion worth of new tariffs, and the EU approximately $28 billion.

It comes just after President Donald Trump hit Canada with 50% tariffs on steel and aluminum imports into the U.S. after Ontario Premier Doug Ford raised the prices of electricity sold to U.S. homes. 

The tax increase comes as Ford engages in reckless talk about embargoes on American electricity and a type of fertilizer used in the U.S., nearly all of which comes from Canada.   

Trump said he’d declare a “National Emergency on electricity within the threatened area,” which will allow the U.S. to deal with the “abusive” threat to American energy by Ford.  

He also promised to raise tariffs on cars manufactured in Canada and sold in the U.S., “which will, essentially, permanently shut down the automobile manufacturing business in Canada.”  

“Those cars can easily be made in the USA!” Trump noted.  

Ontario’s premier raised electricity prices on deliveries of power by 25% to three U.S. states after Trump promised he’d impose reciprocal tariffs on Canada and other countries to equalize trade imbalances. 

“Let me be clear, I will not hesitate to increase this charge, if necessary,’’ Ford said. “If the United States escalates, I will not hesitate to shut the electricity off completely.”  

Ford said he wants to be sending more electricity, more energy and more critical minerals instead of talking about an embargo.  

Ontario provides electricity to Minnesota, New York and Michigan, but only New York is expected to be greatly affected by any change in delivery of electricity by the Canadian province, reported the Associated Press (AP). 

Trump responded quickly to Ford’s threat, not just increasing tariffs, but attacking the idea of importing electricity from Canada. 

“Why would our Country allow another Country to supply us with electricity, even for a small area? Who made these decisions, and why?” asked Trump on Truth Social. “And can you imagine Canada stooping so low as to use ELECTRICITY, that so affects the life of innocent people, as a bargaining chip and threat?” 

During the Trump trade war with China in 2019, the communist country made similar threats about medical supplies, including antibiotics, which Trump shrugged off because of the U.S. economy’s ability to source imports quickly. 

Trump promised that Canada and Ontario would pay “a financial price for this so big that it will be read about in History Books for many years to come!” if Ontario embargoed electricity. 

Former vice presidential candidate, Minnesota Gov. Tim Walz, a Democrat, weighed in on the issue because Minnesota Power bought $300,000 worth of electricity from Ontario last year, according to the AP.  

“The first victims of Trump’s trade war? Minnesotans struggling to pay their skyrocketing electric bill,” said Walz via X.  

Walz told a press briefing that he was even more worried about a potential embargo of potash from Canada. Potash is a fertilizer, nearly all of which is imported to the U.S. from Canada.   

“If it starts with this, the one that I’m really worried about is potash, when it comes behind it. If they do potash, that’s a big one on agriculture,” Walz told reporters. 

It’s unclear how much inside information Walz has, since he met with Ford and the premier of Manitoba last week. Ford has previously floated a potash embargo on the U.S. as a weapon against tariffs. 

According to Global News Canada, Ford met with Saskatchewan Premier Scott Moe and told reporters Canada should no longer sell potash, uranium and oil to the United States as a result of the tariffs, threatening to wipe out American farming.  

“We need to make sure America feels the pain,” Ford said. “Without potash down there, (the U.S.) doesn’t have a farming system.” 

Reuters reports that the U.S. imports 90% of its potash, and 80% of those imports come from Canada.  

Canada is the world’s largest producer of potash, but embargoed Russian potash, which is the second leading source of the alkaline fertilizer worldwide, could soon be back on the market if peace breaks out between Ukraine and Russia. 

Reuters reports that potash prices increased 20% last year, helping fuel food inflation in the U.S. 

Previously, Trump delayed the start of tariffs with Canada, but during his address to the joint session of Congress he promised the tariffs would kick in as a matter of fairness.

“April 2, reciprocal tariffs kick in, and whatever they tariff us, other countries, we will tariff them,” Trump said. “That’s reciprocal; back and forth.”