By Andrew Seidman and Lizzie Mulvey, Philadelphia Inquirer

Every year, Pennsylvania businesses sell hundreds of millions of dollars’ worth of motorcycles, machinery, chocolate, and coffee to companies and consumers in Canada.

Canadian businesses, for their part, export $1.2 billion worth of steel and aluminum products annually to the Keystone State, commodities that are used in everything from building and construction to beer cans and consumer electronics.

Now, amid an escalating global trade war that has rattled financial markets and sown uncertainty across the economy, those are among the products that face new taxes that are straining commerce between Pennsylvania and its biggest trading partner.

» READ MORE: A South Philly produce distributor is girding for pain from Trump’s tariffs on Mexico

“Pennsylvania’s economy is reliant on international business, and that looks like trade. It looks like our ability to attract foreign direct investment, to get international companies to open here and hire Pennsylvanians to help our economy and create jobs,” said Lauren Swartz, chief executive of the nonprofit World Affairs Council of Philadelphia.

“Doing things that limit our ability to access that 96% of the world that lives outside of the U.S., and 74% of global economic growth that occurs outside of the U.S., is going to be felt here at home,” said Swartz, a former Philadelphia deputy commerce director.

After President Donald Trump earlier this month imposed 25% levies on almost all goods from Canada and Mexico — then paused the tax on some imports after the stock market plunged — Trump upped the ante last week. He slapped 25% tariffs on foreign steel and aluminum, including from Canada, which is the biggest supplier of those commodities to the U.S.

That prompted retaliation from our northern neighbor, with matching 25% levies taking effect Thursday on $20.6 billion worth of U.S. goods, including metals, computers, tools, and an array of other products. Those taxes came on top of earlier tariffs Canada announced on goods such as orange juice, coffee, and motorcycles — such as those made by Harley-Davidson, which has a plant in York, Pa. — in response to Trump’s initial levies.

Pennsylvania sent more than $14 billion in goods to Canada in 2024, with top exports including machinery, cocoa, plastics, pharmaceuticals, iron, and steel.

Canada’s taxes on certain U.S. exports affect Pennsylvania products that last year combined for a total of $2.56 billion in sales, according to an Inquirer analysis of Canadian government trade data.

Trump, a Republican, has given a variety of reasons for the new economic posture toward Canada, from stemming the flow of illegal drugs across the border to reviving domestic manufacturing — all the while musing about annexing the longtime U.S. ally.

“It makes no sense,” Gov. Josh Shapiro, a Democrat, said earlier this month, adding that “the effect is going to be higher prices for Pennsylvanians.”

Some American steel and aluminum companies have cheered Trump’s moves, saying foreign companies have long flooded the U.S. market with cheap products subsidized by their governments, making it hard to compete.

Other business leaders have been less sanguine. William Oplinger, CEO of Pittsburgh-based aluminum maker Alcoa, said in February that the president’s tariffs on that commodity could cost 100,000 U.S. jobs.

Local companies are closely monitoring news out of Washington to see how trade policy develops. Northeast Philadelphia helicopter manufacturer Leonardo sources most of its metal products from Quebec, according to Swartz. Michael Cooper, a spokesperson for the Italian company, which employs about 1,000 workers at its Philadelphia assembly plant, said it is “still too soon to comment and evaluate these possible measures.”

Swartz said the products that go back and forth between Pennsylvania and Canada are mostly “inputs to making other things.” Tariffs, she said, will “impact manufacturers and jobs.”

“And each of those inputs that is getting tariffed — perhaps back and forth many times, in something as complex as a vehicle that’s being manufactured, or a big piece of equipment — has to be paid for by someone,” Swartz said.

That will likely mean higher prices for consumers, she said.

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