President Trump had one big question on his mind as Canadian Prime Minister Mark Carney headed to Washington last week.
“I very much want to work with him, but cannot understand one simple TRUTH,” Mr. Trump said in a social media post, reiterating several of ways he believes Canada benefits unfairly from its trade relationship with United States.
The president also repeated his incorrect claim that the United States is “subsidizing” Canada to the tune of $200 billion, alluding to the country’s trade deficit with Canada, which is the value of what the United States imports minus its exports.
In fact, the trade deficit last year was $63.3 billion, according to U.S. data. And if Canada’s energy exports were stripped out, it turns into a trade surplus.
For Mr. Trump, it all boils down to one point: does the United States need Canada?
Mr. Trump’s resounding answer is no, and he has imposed tariffs on many Canadian goods.
“We don’t need their Cars, we don’t need their Energy, we don’t need their Lumber, we don’t need ANYTHING they have, other than their friendship,” he said in the social media post.
But industry groups and government say differently.
The U.S. needs Canada to make cars
The auto industries in Canada and the United States have become highly interconnected over the last three decades — especially between Detroit, Mich., and Windsor, Ontario, the busiest commercial crossing along the border — as the countries knocked down trade barriers.
So intertwined are the supply chains that car parts can cross the border as many as eight times during the manufacturing process. That has made it difficult to define what constitutes an auto import.
In 2023, the United States imported about 1.24 million vehicles from Canada, the fourth-highest tally behind Mexico, Japan and South Korea.
The U.S. needs Canada’s energy
The United States is the world’s top oil producer, but many of its refineries rely partially on crude oil, a variety that Canada specializes in extracting. Retooling U.S. refineries to eliminate the need for crude oil would cost billions and companies are not willing to make those investments, especially because of the uncertainty over Mr. Trump’s trade policies.
Sixty percent of the crude oil imported from the United States in 2022 came from Canada, according to the U.S. Energy Information Administration.
Besides oil, Canada, in 2023, supplied nearly 100 percent of the natural gas and 85 percent of the electrical energy imported by the United States, according to Canada’s energy regulator. Canadian electricity is especially important to powering New England.
Canada also more provides more than one-fourth of the uranium the United States imports to run nuclear reactors, federal data shows, a higher share than any other nation.
The U.S. needs Canada’s lumber
Howard Lutnick, the U.S. commerce secretary, is investigating whether lumber imports are a threat to national security.
In 2021, the most recent year figures were available, the United States purchased $28 billion worth of lumber from Canada, representing nearly half of lumber imports.
American industry groups have estimated that the tariffs on lumber that Mr. Trump has introduced will increase home costs by an average of about $9,000.
For now, the United States lumber industry cannot meet the demand from home builders, according to a recent analysis by Fastmarkets, a research company, and it would take the country at least 10 years to whittle down its need for imported lumber.
U.S. farmers need Canada to plant their crops
Farmers kicking off the planting season this year were reminded of the U.S. agriculture industry’s reliance on Canadian imports of key chemical ingredients used in fertilizer, like the potassium-rich minerals called potash.
The United States imports 85 percent of its potash from Canada, which is the world’s largest exporter of the minerals.
But Mr. Trump’s tariffs on Canada will make potash more expensive for farmers to import and the increases could be passed down to grocery store shoppers, according to the Fertilizer Institute, a U.S. industry group. The next biggest global exporters of potash are Russia and Belarus.
Trump says the U.S. needs Canada’s friendship. Many Canadians say forget about it.
The usually warm relationship between the two countries is in tatters, with Canada invoking a defensive tactic used in hockey — “elbows up” — as its posture against Mr. Trump’s economic attacks and threats to make Canada a U.S. state.
Canadians have taken to boycotting American-made products and shirking summer travel to the United States, with the number of flights scheduled to the country from Canada down by 21 percent, a New York Times analysis shows.
A quirky symbol of the countries’ special bond has also suffered. The United States has restricted Canadian access to the Haskell Free Library and Opera House, a historic site that straddles the border between Quebec and Vermont. American officials said the move was necessary to stop “drug traffickers and smugglers.”
Despite the frosty relations, Mr. Carney and Mr. Trump had a cordial exchange in front of news media cameras in the Oval Office last week.
Mr. Trump s described his “love” for Canada and desire for continued friendship. Still he repeated his desire for Canada to become part of the United States.
Mr. Carney quickly pushed back to make clear that his country was not for sale.
Mr. Trump did not relent: “Never say never!”
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