The share of Canadian exports bound for the United States is gradually trending lower, averaging 76% in 2024 and 72% last year, and coming in at 69% in April 2026, said Scotiabank.
This has been driven by a decline in exports to the U.S. and increasing exports to other regions -- mainly Europe, noted the bank. In April, exports to the U.S. rose 4.8% month over month and were up 5.7% compared with 2024.
Exports to other countries dropped 4.8% month over month but were up 48.3% from 2024 -- though much of this has been driven by elevated overseas exports of gold. On the import side, the share of Canadian imports from the U.S. has gradually fallen to 59% in April from an average of 62% in 2024.
Canada continues to benefit from a relatively low effective tariff rate on total exports. Scotiabank's latest estimate is 2.9% -- based on pre-tariff trade flows -- of the increase in tariffs since the end of 2024, thanks to most of Canada's trade with the U.S. continuing on a tariff-free basis under CUSMA.
The reported average actual duties paid on U.S. goods imports from Canada was slightly above 3% for the fifth month in a row, down from close to 4% last fall. The proportion of Canadian goods imported into the U.S. facing tariffs rose from 17% to 19% in April.
The replacement of the U.S. IEEPA tariffs with the temporary global tariff of 10% was positive for Canada -- and many other U.S. trade partners -- though the vast majority of Canada's trade has been deemed CUSMA-compliant and, as such, exempt from those tariffs, pointed out the bank.
It also appears that Canada will be largely exempt from the coming tariffs related to forced labor, added Scotiabank. The sectoral tariffs are by far the most impactful for Canada and remain significant headwinds for impacted sectors, though some tweaks were made on June 1 that should slightly lower the burden of the steel, aluminum and copper tariffs until the end of 2027.