Packaging industry braces for impacts from U.S.-Canada trade war

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The burgeoning trade war between the United States and Canada is gaining attention from businesses on both sides of the border and beyond to see whether the threatened tariffs stick. As the situation evolves, it’s becoming clearer that companies across the packaging industry stand to have their resilience tested — at a time when other geopolitical and economic hurdles are also creating pressure.

On Tuesday, Canadian Prime Minister Mark Carney announced tariffs up to 50% on $27.6 billion of materials and goods it imports from the United States in response to U.S. President Donald Trump imposing similar tariffs over the weekend after trade talks collapsed. Canada is the U.S.’ second largest trading partner, just behind Mexico, according to U.S.Census Bureau data.

The packaging industry is expected to experience widespread effects from the squabble as the added costs are applied across supply chains. However, sectors that stand to feel the most pronounced effects are those that rely on materials or products directly named in the countries’ tariff orders: Canada listed pulp and paper as well as aluminum and steel while the U.S. cited wood products and paper, which analysts surmised also includes containerboard and boxboard — separate from the U.S.’ sectoral tariffs on metals.

Ahead of the trade dispute, some packaging company executives talked during recent earnings calls about their tariff mitigation plans. Cascades executives said on Aug. 6 that they were assessing potential impacts from the U.S.’ 50% tariffs on Canadian imports and were devising an impact mitigation plan. On Aug. 4, Ball executives expressed concern about tariffs and said they’re watching aluminum prices.

Given the expectations for sweeping cost increases, certain companies in the packaging supply chain are assessing whether to pull forward purchases and shipments to beat the Sept. 8 tariffs, said multiple sources with knowledge of the industry. However, there’s little firm evidence of widespread frontloading so far in this rapidly evolving environment.

All the companies Packaging Dive contacted declined to comment on the U.S.-Canada situation. But some trade groups weighed in.

Fiber

“The U.S. pulp, paper, packaging and tissue supply chain is deeply integrated across North America,” said American Forest & Paper Association President and CEO Heidi Brock in a statement Tuesday.

“New counter-tariffs on U.S. goods, including pulp and paper products, risk adding uncertainty and cost for manufacturers, workers, customers and communities on both sides of the border,” she said. While the group supports trade policies that address unfair practices and strengthen U.S. manufacturing, “escalating tariff disputes between the U.S. and Canada will disrupt the cross-border supply chains that help mills and manufacturers.” 

On the other side of the border, the Canadian Corrugated and Containerboard Association said in a LinkedIn post over the weekend that it is “disappointed that a stable, fair trade agreement has not been reached.”

“Canada should make clear that the corrugated and containerboard industry is deeply integrated across the border, and that tariffs would harm manufacturers, workers and customers on both sides,” said Serge Desgagnés, CCCA executive director, in a letter. “Since virtually every product relies on corrugated packaging, disrupting this supply chain would disrupt many others.”

In addition to raising costs for manufacturers and exporters, disruptions to corrugated trade could affect recovered fiber markets that sustain the country’s recycling infrastructure, according to CCCA. The group called on leaders in both countries to continue talks and remove corrugated products from the proposed tariffs.

Metals

Beginning Sept. 8, Canada is set to double levies for metal imports from the current 25%, mirroring the Trump administration’s Section 232 tariffs of 50% for aluminum, steel and copper along with derivative products.

While the Can Manufacturers Institute did not comment on the current U.S.-Canada situation, in the past it has noted that steel and aluminum tariffs filter through supply chains to raise the price of canned goods at grocery stores. It has also highlighted for years that the U.S. imports a huge amount of its aluminum and tin mill steel, with domestic can makers importing nearly 80% of the latter. Canada supplies about two-thirds of the primary aluminum used in the U.S., according to The Aluminum Association. 

Trump referenced the supply disparity on Monday, saying that the U.S. “desperately needs aluminum,” Bloomberg reported. “We get it all from Canada for the most part, and we need it badly.”

Regarding that aluminum need, The Aluminum Association President and CEO Charles Johnson said in a LinkedIn post Tuesday prior to Canada’s measures: “He’s right. That’s why America must grow both primary and recycled aluminum production as part of an ‘all-of-the-above’ approach to metal supply.”

Aluminum demand remains strong in the U.S., according to AA, but it will take years to bring online more domestic production capacity. Therefore, the association says that “we have no alternative than to import primary metal,” and the U.S. should also continue to grow its recycled aluminum production. Approximately 85% of U.S. aluminum production is secondary, according to AA.

After Canada announced its countertariffs, AA told Packaging Dive via email that it is assessing the measures and reiterated that the northern neighbor is a significant trading partner for U.S. companies.

“These measures will negatively impact segments of the industry by limiting opportunities for U.S. producers to compete in Canada at a time when America should be well positioned to meet growing aluminum demand,” Johnson said. The “all-of-the-above” approach to metal supply involves “smart, targeted trade enforcement.”

“We are hopeful that U.S. and Canadian trade officials come back to the table soon to pursue a fair and reasonable agreement,” Johnson said.

Glass

Canada’s tariffs directive on Tuesday did not specifically name glass. However, glass packaging has been caught in the middle of a Canadian boycott of U.S.-produced alcoholic beverages for about a year. In July, the U.S. announced additional 50% duties on many alcoholic beverages imported from Canada.

In a statement, the Glass Packaging Institute cited Commerce Department data showing the U.S. imported 348 million glass bottles and jars from Canada in 2025, with a value exceeding $86 million. Those items have moved freely across North America without duties under the United States-Mexico-Canada Agreement, it said.

The trade group expressed concern that the additional Section 338 tariffs on Canadian glass bottles, jars and raw materials would increase pressure “on an already highly integrated North American supply chain that has seen sales declines during the reciprocal tariff policy debate.”

GPI said it’s a member of the Toasts Not Tariffs Coalition, which calls for “a swift resolution to the U.S.-Canada trade dispute and the return of U.S. wine and spirits to Canadian store shelves.”

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