WASHINGTON, Sept. 5 — The 50% tariffs President Donald Trump levied on Canada on July 20 are set to collide with roughly $20 billion in Canadian counter-tariffs on 700–800 American products beginning September 8, and the beauty industry is bracing for the disruption. The bottom line: Canada is the US beauty industry’s largest export market at $4.2 billion annually, according to the Personal Care Products Council (PCPC), and was the second-largest source of US beauty and skincare imports in 2025 after South Korea, supplying over $1 billion worth of products.
The tariffs hit cosmetic ingredients, natural and botanical materials, and packaging — and CUSMA-compliant products are not exempt, a violation of the trade agreement.
An integrated supply chain under strain
Darren Praznik, President and CEO of Cosmetics Alliance Canada, said the speed of the escalation is the problem. “When you put tariffs and counter-tariffs on so quickly, you will disrupt manufacturing systems, supply chains, distribution channels all across North America to no one’s immediate advantage,” he said. “In many ways, companies are now having to imagine the unimaginable.” Praznik described the pre-tariff system as highly efficient.
“Tariff-free trade has allowed us to be very efficient in our supply, manufacturing, and product distribution ways,” he said. “So when Trump decided to abandon conventional economics, he has thrown a wrench in a well-working system, and it’s blowing up to some degree.” The July escalation follows a dispute that began when Trump returned to office in 2025.
February 2025 brought 25% tariffs on most Canadian goods and 10% on Canadian energy; Canada answered with 25% tariffs on roughly $30 billion of US imports, and the US later raised its tariffs to 35%.
Major players exposed
L’Oréal CEO Nicolas Hieronimus said on a July 30 earnings call that tariffs had hit gross margin but were offset: “We had good work and good news on the gross margin at 10 basis points despite 20 basis points of negative impact of the tariffs.” Estée Lauder is exposed through Canadian manufacturing, including MAC Cosmetics and The Ordinary production in Ontario. Heather Helm, PCPC Executive Vice President for Global Strategies, warned of the broader effect.
“Trade barriers risk disrupting the efficient and predictable movement of products across the border, and potentially limiting consumer choice and access to everyday products,” she said. The PCPC supports more than 2.6 million American jobs and exports $15.8 billion in products yearly.
Cheekbone Beauty, a Canadian Indigenous-owned brand, has issued a statement on the 50% tariff.
What to watch
Companies face a narrow set of options: absorb costs, raise prices, reroute production, or shift to Canadian contract manufacturers. Smaller brands lack that flexibility, and Praznik warned of the competitive stakes. “The reality is, our industry is highly competitive. If you withdraw from the market, someone else is likely to fill it,” he said. “The big question is, can you afford to give up that revenue?”
