Washington's 50% cheese tariff hits American importers and farmers first, while Canada holds firm

In July 2025, a raw milk wheel called Alfred le Fermier from Compton, Quebec, beat nearly 1,600 cheeses to win best of show at the American Cheese Society. The farm behind it, Fromagerie la Station, had also won the year before. Third place that night went to an Ontario gruyère-style wheel.

A year later, Washington went after that product. On July 20, 2026, President Trump signed proclamations under Section 338 of the Tariff Act of 1930, including one on dairy. Canadian cheese was added to a 50% tariff list on September 15, and Canadian whey products were banned outright on September 29.

A quota dispute on a trade America was winning

The stated grievance concerns quota administration. Canada admits American cheese duty-free up to a fixed quota. Washington objects that Canadian retailers can hold quota for European cheese but not for American cheese. That is an argument over which Canadian companies get import permits, not over whether American cheese can enter Canada.

A trade agreement panel already ruled on those quota rules in November 2023, and it sided with Canada.

The numbers do not favour Washington's case either. In 2025, according to a University of Wisconsin analysis built on United Nations customs data, American companies sold Canada about $134 million of cheese. Canadian companies sold the United States about $91 million. America was selling more cheese to Canada than it bought.

Canada's tariffs of around 245% on cheese apply only above the agreed quotas. Inside those quotas, American cheese crossed the border paying nothing until Canada's 25% response.

Canada's measured response

Ottawa's reply on September 8 was calibrated. Canada matched Washington's 50% on dairy ingredients, which had taken effect on August 22 for whey, milk proteins and milk powders. On American cheese it stopped at 25%, half the American rate.

Ottawa also kept supply management intact. Dairy Farmers of Canada urged the government not to trade it away for tariff relief, and Prime Minister Mark Carney said his government stands by the system.

The approach avoids escalation for its own sake, protects the farm system that Canadian producers rely on, and puts the pressure where the damage is felt.

Who is paying

A tariff is paid by the importer. For Canadian cheese in the United States, that means American companies such as Provisions International in Vermont. Its sales director, James Hanley, told CBC that demand for Canadian cheese has trailed off since the tariffs arrived, as higher prices pushed shoppers to other products.

Mariposa Dairy in Lindsay, Ontario, sends as much as 80% of its cheese south of the border. CEO Mark Anderson notes that goat milk sits outside supply management, so a tariff on goat cheese does not touch the system Washington says it objects to. He also points out that the United States has long relied on Canada and Europe for soft goat cheese. A tariff does not bring that production home. It makes the product more expensive.

The costs reach farms too. Wisconsin makes about a quarter of American cheese, and the University of Wisconsin analysis estimates a sustained fight costs its dairy farms between $65 million and $113 million a year, because lost Canadian sales push down the cheese and whey prices that set what farmers are paid for milk.

American cheesemakers are saying so themselves. Matteo Kehler, who used to sell many cheeses in Quebec and Ontario, said those orders stopped after the 2025 tariffs and have not returned. He said that Canadians voting with their wallets is understandable.

What to watch next

Two things matter in the coming weeks. The first is a lawsuit by a New Jersey cheese importer at the Court of International Trade in New York, challenging the Section 338 tariffs. If the court rules against them, the cheese duty could fall with them.

The second is the export data for September and October, which will show how far Wisconsin's cheese and whey sales to Canada have already dropped.

There is also a policy question for Ottawa: whether to keep its 25% tariff on American cheese until Washington drops its 50%, or ease it for the American producers who have stood with Canada. For now, Canada's position is steady. It has answered proportionately, protected its own system, and left the argument with those who started it.