Canada has lost its nearly 30-year position as the United States’ largest buyer of American goods. New U.S. Census data shows Mexico imported slightly more U.S. products than Canada between January and August 2025 — US$226.4 billion (C$319 billion) versus Canada’s US$225.6 billion (C$317.9 billion) (1).
This shift is part of a longer trend. In 2024, Mexico had already become the U.S.’s top overall trading partner, ahead of both Canada and China (2).
While this can feel like a political or business story, the implications reach directly into Canadian households. Everything from food and fuel to electronics and cars is shaped by how North American supply chains move — and who gets priority.
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Why this matters for everyday shoppers
Canada relies heavily on U.S. goods. Much of the produce in winter, major appliances, vehicles, gasoline, packaged foods and everyday retail items come from American suppliers. When Canada becomes a relatively smaller customer, it can affect:
- How quickly goods arrive
- How U.S. companies allocate supply
- How prices shift when demand surges
At the same time, the shift opens new opportunities for Canada to diversify where goods come from, and this could help stabilize the cost of items, over time.
The potential benefits for Canadian consumers
- More diverse product sourcing: Retailers may expand buying from Europe, Asia and Mexico, reducing the risk of shortages tied to U.S. disruptions.
- More competition on shelves: New suppliers can help limit price spikes, especially for electronics, apparel and food.
- Less vulnerability to U.S. politics: Tariffs and sudden U.S. policy changes have repeatedly targeted Canadian goods. Reduced dependence helps insulate prices.
The drawbacks — and why some prices may rise
- Lower priority in U.S. supply chains: With Mexico now the U.S.’s top buyer and supplier, American producers may favour Mexican contracts during high demand periods — leading to delays or price pressure in Canada.
- Higher exposure during trade disputes: Canada’s declining share of U.S. trade reduces bargaining power, increasing the risk that tariffs filter into consumer prices.
- Costly transition to alternative suppliers: Sourcing from outside the U.S. typically involves higher shipping and logistics costs, which can lead to more volatile pricing until supply chains stabilize.
- Impacts on Canadian jobs and wages: If Canadian manufacturers lose U.S. market share, household incomes and purchase power can be indirectly affected.
Read more: Here are 5 expenses that Canadians (almost) always overpay for — and very quickly regret. How many are hurting you?
What households can expect
Canada’s shrinking importance in U.S. trade doesn’t mean grocery bills will spike overnight. But consumers should prepare for more volatility in U.S.-sourced goods — especially vehicles, electronics, appliances and certain foods.
At the same time, diversification could bring more options and potentially better prices as retailers adjust supply chains.
The transition will matter most for major purchases: cars, large appliances, building materials and fuels. These depend heavily on U.S. production and are most sensitive to supply bottlenecks and tariffs.
What Canadian consumers can do as U.S. trade priorities shift
1. Expect more price swings — and plan purchases accordingly
The first step is to be prepared. Canadians should expect more price swings — and plan purchases accordingly, particularly for goods that rely heavily on U.S. supply chains, such as vehicles, electronics, appliances, produce and fuel.
What to do:
- Track sales cycles and delay big purchases if prices spike
- Build a flexible grocery budget to handle short-term increases
- Use price alerts for major purchases
2. Compare more brands and more countries of origin
The next task is to start comparison shopping — regularly. Start reading labels and becoming aware of the country of origin for items you buy.
What to do:
- Compare similar products from different regions
- Consider alternatives if U.S.-sourced goods see higher shipping or tariff costs
- Try private-label or domestic options when prices rise
3. Don’t assume U.S. goods are cheapest
Mexico is becoming the U.S.’s top trading partner because its goods are often more affordable and easier to produce.
What to do:
- Check for Mexican-made or Asian-made equivalents
- Look for new product lines from retailers diversifying supply chains
4. Stock up during stable-price periods
Grocery categories tied to U.S. imports — such as fresh produce, dairy, and packaged foods — may experience more variability.
What to do:
- Buy non-perishables in bulk when prices are low
- Freeze meat or produce during dips in price
- Track weekly flyers to find predictable patterns
5. Support Canadian-made when possible
If Canada ramps up domestic production in response to U.S. shifts, then early consumer demand will help stabilize prices.
What to do:
- Choose Canadian-made goods when quality and price match
- Explore local farmers’ markets for produce and staples
- Consider domestic brands for furniture, apparel and household goods
Bottom line
Canada is still one of America’s most important economic partners — second overall in total trade and still a major importer and exporter. But the data shows a clear trajectory: Canada’s relative weight in the North American economy is declining, and Mexico’s is rising sharply.
For Canadians, this is a double-edged development. Less reliance on a single trading partner could lead to better global diversification, but losing influence in the U.S. market introduces risks — especially as the USMCA heads into its 2026 review.
The coming years will determine whether this shift becomes a permanent realignment or a temporary reshuffling. With the USMCA trade agreement up for review in 2026, further changes could influence import duties, delivery timelines and cross-border pricing (3). Canadians will see the full effects of this trade shift in the next two to five years as companies and governments recalibrate. Until then, use all the tools at your disposal to comparison shop and spend where and what you support.
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Article sources
We rely only on vetted sources and credible third-party reporting. For details, see our editorial ethics and guidelines.
U.S. Census Bureau (1, 2); CSIS (3)
This article provides information only and should not be construed as advice. It is provided without warranty of any kind.