Canada is preparing for the threat of Trump’s tariffs with a three-stage plan

Florida orange juice. Tennessee whiskey. Kentucky peanut butter.

Canada is preparing for an all-out trade war with its closest ally and one of its top allies trading partners, and the list of American goods that could be affected is long.

Canadian officials are preparing a three-stage plan of retaliatory tariffs and other trade restrictions against the United States that will be put into action if President-elect Donald J. Trump follows through on his threat to impose a blanket 25 percent tariff on all Canadian goods, that are imported into the United States.

Canadian officials will wait until Mr. Trump makes his move — which he said will be on Monday, his first day in office — and then begin imposing tariffs. They would primarily affect C$37 billion ($25.6 billion) worth of consumer goods, according to two senior government officials familiar with the plans.

They spoke on condition of anonymity to discuss details of the plans, which were expected to remain confidential for now.

Goal: Maximum political pain

Canadian officials said their selection of goods was targeted and designed for political impact. They particularly want to focus on goods made in Republican or swing states, where the burden of tariffs, such as pressure on jobs and local business profits, would hit Trump allies.

Canada’s government hopes that these allies, including governors or members of Congress, would then pick up the phone and call Mr. Trump and advocate for de-escalation.

Mélanie Joly, Canada’s foreign minister, who spent Thursday and Friday in Washington, met with a number of Republicans to lay out her country’s case, including Sen. Lindsey Graham of South Carolina, Sen. Jim Risch of Idaho and Senate Majority Leader John Thune South Dakota.

Ms. Joly said she hoped her outreach to senior Republicans would persuade them to intervene to avert or limit a trade war and its negative impact on consumers and jobs on both sides of the border.

“My job here is to be able to talk about the facts, and that comes before any threat of counter-tariffs from us,” Ms. Joly said in an interview with The Times on Thursday. “Because then the senators could say, ‘Why are we doing this?’ Why do we impose tariffs? It affects my own constituency.’”

However, she added that Canada stands ready to vigorously defend its interests if necessary. “Never underestimate Canadians,” she said. “We fight very hard and are very brave. We are prepared to act surgically and appropriately to make an impact on American workplaces.”

Prime Minister Justin Trudeau and his Cabinet are preparing for Mr. Trump’s first day in office and what he could bring for Canada, huddling in what some are calling a “US war room” on Monday and Tuesday to do so reach We respond quickly when US tariffs are announced.

While the detailed list of goods is closely guarded, it includes dozens of consumer goods from various categories, such as food and beverages, as well as other types of everyday products, including dishwashers and porcelain goods such as bathtubs and toilets.

Depending on which Canadian goods Mr. Trump imposes tariffs on and how high those tariffs are, Canada’s second step would be to extend its own tariffs to more American products, impacting C$150 billion worth of imports from the United States would.

As part of its strategy, the Canadian government is also examining other measures that would restrict the export of Canadian goods to the USA, such as export quotas or tariffs borne by the American side. Measures of this kind would be reserved for particularly sensitive Canadian exports that the United States relies on, such as Quebec hydroelectric power, which is used to provide energy throughout New England.

Tariffs act more like a tax on goods and are usually passed on to consumers. They make imported goods more expensive, which often causes consumers to stop buying them, ultimately hurting the foreign companies that export them.

Trade restrictions such as export quotas aim to limit the availability of an exported good and are particularly effective when an importing country does not have easily accessible or sufficient alternative sources of that good.

Back from the brink

No matter how Canada’s counter-tariffs or export restrictions are used, the goal will be the same: to pressure the Trump administration to back down from the president-elect’s promise to launch a devastating trade war against the United States’ neighbor.

Trade relations between the two countries are enormous: almost a trillion dollars worth of goods are exchanged every year. Canada fluctuates depending on oil prices, with Mexico as the United States’ largest trading partner.

Some cross-border industries are so integrated that tariffs would suddenly pose a major regulatory problem for many companies. For example, a single vehicle crosses the US-Canadian border up to eight times before it is fully assembled. Tariffs would immediately cripple car assembly lines across the United States and in Ontario, the heart of the auto industry in Canada.

And Canada exports essential goods to the United States. About 80 percent of Canada’s oil and 60 percent of its natural gas are exported to the United States. More than half of the oil imported into the United States comes from Canada.

A third and final stage of escalation if a U.S.-Canada trade war escalates, which the Canadian government is keen to avoid, would restrict exports of sensitive commodities worth hundreds of billions of dollars, including oil and gas, potash, uranium and critical minerals . All are exports that are critical to the United States

Alberta, Canada’s oil-exporting powerhouse, has said it does not support measures that would impact its key industry. The rift between the province’s leadership and the rest of the country could become even more consequential if Canada decides to use oil as leverage against the United States.

Canada’s plans for a potentially lengthy U.S. trade war include supporting domestic industries, according to a senior official.

The government is preparing for the possibility of financial bailouts for Canadian companies hit hard by U.S. tariffs, most likely on a case-by-case basis, the official said.

While mass bailouts or blanket funding of entire industries may not be on the table, the official said it was unthinkable to allow a tariff war with the United States to wipe out thousands of jobs and businesses without the government stepping in to soften the blow.