While the 18-month trade dispute has primarily focused on what Canada sells to the US, the flow of American goods into Canada has largely remained overlooked, according to Bank of Montreal Capital Markets (BMO) in a note Tuesday.
The limited attention to Canadian measures reflects that Ottawa removed most retaliatory tariffs nearly a year ago, BMO wrote.
The Bank of Canada estimates that country's average tariff on US imports has fallen to 1.5%, well below the 5.0% US tariff rate on Canadian goods that preceded Monday's announcement of new specific tariffs from the administration of President Donald Trump.
"What's notable is that even with a modest tariff rate, US exports to Canada have dropped about 5% in the past 18 months," wrote BMO Chief Economist Douglas Porter in the note.
Canada's share of overall US exports has slipped to just under 14% this year, compared with around 18% in 2024 and roughly 22% when the Free Trade and the North American Free Trade agreements were signed, added the bank.
The long-running decline in Canada's share of US exports has accelerated notably since the beginning of 2025, when President Trump retook office.