Canada sells about 70% of its goods to the US, but it has leverage in the spiralling trade dispute. This was reported by Qazaqyia.kz citing BBC News.
Canada is the top customer for 26 US states, including Maine, Michigan, and Wisconsin. It is in the top three for 45 of the 50 American states, giving Prime Minister Mark Carney room to manoeuvre.
Carney's planned retaliatory duties are strategic "dollar-for-dollar" countermeasures focused on steel, dairy, appliances, agricultural equipment, electronics, pulp and paper - though the list is still being finalised.
Polls suggest a majority of Canadians would be unhappy if the government made significant concessions to the US. Ontario Premier Doug Ford, one of Trump's most vocal critics, responded to tariff threats by telling the US president to "kiss my ass".
Carney noted that Canada supplies the vast majority of US natural gas and electricity imports and about 60% of crude oil imports. "I don't think they want us to stop sending any of that energy," he said.
Squeezing the US on energy is not in the current countermeasures, but officials have not ruled it out. Ford, whose province is home to Canada's auto industry, said an "energy surcharge is on the table". He briefly floated a 25% surcharge on electricity exports to the US, which would have impacted 1.5 million homes and businesses in Michigan, Minnesota and New York.
Canada is also the world's top supplier of potash, a product in fertiliser. "I'd love to see [Trump] run cars without any oil. I'll love to see him grow vegetables and fruit without the potash," Ford said. "President Trump underestimates us, and that's the biggest mistake."
Canada has significant reserves of critical minerals like lithium, nickel and graphite. The US is Canada's top destination for mineral exports. Ford said the US "won't get a grain of sand out of Ontario".
Canada has already proven it can cause economic pain. Provincial bans on US alcohol led to a collapse in American wine exports, which the Wine Institute called the "most significant market disruption in decades". US wine exports to Canada fell 78% year over year, a $357m (C$494m; £261m) loss. Distillers reported a drop of more than 70% in spirits exports. The boycott remains in 11 of 13 provinces and territories.
Canadians also made 800,000 fewer trips to the US in April compared to 2024, leading to a loss of about C$3.3bn ($2.35bn; £1.75bn) in revenue for the US last year. Some American cities and states have appealed for Canadians to return through targeted advertisements and special deals.