Register to continue reading for free
Canadian shoe manufacturers prepare for US tariffs
The Canadian footwear industry is collaborating with the government to address US tariffs, while businesses accelerate shipments and secure materials to minimise the impact of possible rising costs. We spoke with Denis Falardeau from the Shoe Manufacturers Association of Canada
The recent imposition of a 25% tariff on Canadian imports by the United States is anticipated to significantly impact Canada's footwear industry. Although the tariff is currently on pause for 30 days, industry experts predict a slowdown in sales if it comes into effect, consequently reducing production activities. However, the current weakness of the Canadian dollar against the US dollar may offer a slight competitive advantage to Canadian manufacturers in the US market.
According to Denis Falardeau, President of the Shoe Manufacturers Association of Canada, some Canadian footwear manufacturers are proactively shipping as much inventory as possible to the US before the tariffs take effect. Additionally, they are increasing production to build up inventories, aiming to save on components and materials that are currently not subject to tariffs.
The implementation of these tariffs is expected to lead to higher consumer prices in both Canada and the United States, Falardeau shared. The increased costs associated with the tariffs will likely be passed on to consumers, resulting in more expensive footwear products in both markets.
The Canadian footwear industry is actively working with the federal government to prepare for various scenarios arising from the tariffs. This partnership aims to develop strategies to mitigate the industry's potential negative impacts and negotiate responses to the US tariffs.
The imposition of tariffs will probably have broader economic implications, with concerns about potential recessions in both Canada and the US. Analysts warn that these trade measures could disrupt supply chains, increase consumer costs and strain the longstanding trade relationship between the two nations.
Trade Statistics
According to data from the United States International Trade Commission, Canadian footwear exports to the US surged by 17% in value and 27% in average price in 2024 compared to the previous year. However, export volumes declined by 8% compared to 2023. Overall, the total export value from Canada to the US decreased by 2% in 2024 compared to the year before.
Image Credits: Rene Baker on Unsplash
