Which Canadian companies are most at risk of U.S. tariffs?

As Canada braces for the March, 4 lift on Trump's tariff relief, certain sectors may be particularly vulnerable. Head of equity at Syntax Data Ellison Kandler e

A new report outlines the top 10 Canadian companies facing downside risks if U.S. tariffs are enacted, with nearly half of the firms on the list operating in the energy sector.

The report, authored by Syntax Data, comes amid fresh tariff threats from the U.S. On Monday, President Donald Trump said that tariffs on Canada are “going forward on time,” with an executive order that was delayed until March 4 to implement a 25 per cent tariff on all Canadian imports with a lower 10 per cent levy on energy. On Wednesday, a White House official confirmed the tariff plans could change as a result of negotiations.

The report said tariffs could impact Canadian industries that rely on the U.S. for trade, along with raising costs for Canadian exporters and potentially disrupting supply chains. As a result, Syntax Data said in the report that it screened for Canadian firms with the largest U.S. revenues and “therefore highest exposure to U.S.-imposed tariffs.”

“The energy sector is at risk given how much business Canadian energy producers do with the U.S. Forty percent of the top 10 companies identified are in energy production, including Enbridge Inc. and TC Energy, which each generate approximately 50 per cent of their revenue in the U.S.,” the report reads.

“With 60 per cent of U.S. crude oil being imported from Canada, a 10 per cent tariff on energy could have major implications for the energy industry. While lower tariffs are likely designed to avoid extreme energy price hikes for U.S. consumers, Canadian energy companies with significant U.S. exposure would face major ramifications.”

(Source: Syntax Data)

Ellison Kandler, an SVP and head of equity at Syntax Data, said in an interview with BNN Bloomberg Monday, that the report looks to break down complex supply chain information into a data base format, which “allows an investor to know exactly what may or may not be at risk here.”

He added that tariffs are very complex, and investors need to be able to determine how companies may be impacted.

“Given how complicated the story is, companies are more than just their revenues, and they’re multinational. They have operations across the world. So, these companies are not only earning revenues in the United States, but may or may not also have operations there,” he said.

Nutrien, the Saskatoon-based fertilizer producer, is the company deemed most at risk in the report, noting that it generates 61 per cent of its annual revenue, or around US$17.66 billion from U.S. transactions. As a result, its customers could face $4.41 billion in additional costs due to tariffs.

“Agriculture is obviously a big cross-border good, and the agricultural products are essentially going to be tariffed. And what we’re looking at is essentially the potash mines out in Saskatchewan, are they going to be primed for the tariff...a lot of their nitrogen facilities are actually located in the United States,” Kandler said.

Calgary-based Enbridge, was identified as the second most at risk firm, with Kandler highlighting that it has pipelines “crisscrossing the U.S. border.”

“The interesting thing about Enbridge is that it’s within that energy tariff bucket, which essentially, they have decided to slap not 25 per cent but potentially 10 per cent. That’s a recognition that a lot of the energy that the United States is bringing in is essentially being refined by U.S. refiners and then either used here at home or shipped worldwide,” he said.

“I think that’s more of a recognition that energy, which I believe is also the biggest component of the trade deficit between the United States and Canada, is sort of an important piece that you have to be a little bit careful about.”

Magna International, an Ontario-based auto parts manufacturer, was listed as the third most at risk firm in the report.

“Not only are they super integrated into the North American automotive ecosystem, but they have a separate set of tariffs on automotive products as well as semiconductors, pharmaceuticals that may be completely separate from the Canadian tariffs.,” Kandler said.

On Feb. 18, Trump said he intends to impose auto tariffs “in the neighborhood of 25 per cent.”

Lats week, Flavio Volpe, the president of the Automotive Parts Manufacturers' Association, told BNN Bloomberg that the North American auto industry would sooner “shut down” before operating under 25 per cent tariffs.