Canada buys $4.2 billion worth of American cosmetics and personal care products every year, more than any other country, according to the Personal Care Products Council. In 2025 it was also the second-largest source of US beauty and skincare imports, behind only South Korea, sending in more than $1 billion of product. That two-way traffic is now caught in a tariff fight.
President Donald Trump put 50% tariffs on Canada through a series of executive orders on July 20. Canada answered with roughly $20 billion in dollar-for-dollar counter-tariffs on 700 to 800 American products, due to take effect on Sept. 8. The duties reach cosmetic ingredients, natural and botanical materials and packaging, and products that comply with the CUSMA trade agreement are not exempt, which would violate the agreement. Negotiations are strained, with no solution in sight.
A supply chain built on free trade
Darren Praznik, president and CEO of Cosmetics Alliance Canada, said the speed of the escalation is what hurts. “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 told BeautyMatter. “In many ways, companies are now having to imagine the unimaginable.”
The old arrangement worked, he said. “Tariff-free trade has allowed us to be very efficient in our supply, manufacturing, and product distribution ways.” Then, in his words, Trump “threw a wrench in a well-working system, and it’s blowing up to some degree.”
This round follows a dispute running since Trump returned to office in 2025. In February the administration announced 25% tariffs on most Canadian goods and 10% on Canadian energy. Canada hit back with 25% tariffs on about $30 billion of US imports, and Washington later raised its tariff on Canadian goods to 35%.
Heather Helm, the council’s executive vice president for global strategies, said trade barriers “risk disrupting the efficient and predictable movement of products across the border, and potentially limiting consumer choice and access to everyday products.” The council supports more than 2.6 million American jobs and exports $15.8 billion in products each year. Helm urged officials in both countries to resume negotiations and find a durable solution.
Big companies feel it too
The tariffs already show up in earnings. On L’Oréal’s July 30 call, CEO Nicolas Hieronimus said the company posted a gross margin gain of 10 basis points despite a 20 basis point hit from tariffs. “And we wanted to deliver 20 basis points of profit increase,” he added. Estée Lauder is exposed through its Canadian manufacturing, including production tied to MAC Cosmetics and The Ordinary, which originate or scale heavily out of Ontario.
Large groups can reroute. They may supply Canada from elsewhere or move production north, and Praznik said companies could use Canada’s established contract manufacturers rather than build their own plants. The choices come down to absorbing the cost, passing it to shoppers or rethinking where products are made.
Small brands lose the market
Smaller companies have no such room. Cheekbone Beauty, an Indigenous-owned Canadian brand, said the 50% tariff makes shipping its Canadian-made products directly to the US “financially unworkable” and that it is pausing those shipments indefinitely. “We are not able to absorb that cost, and we do not think it is fair to pass a 50% price increase onto [consumers],” said Katelynn Miron, its Marketing Operations Manager.
AG Care, a professional haircare brand that formulates and manufactures in Canada but buys many US ingredients, plans to absorb the tariffs and hope the dispute is short. It has also stopped shipping to the US for now.
The costs run down to the salon chair. Megan Skaggs, who runs the Instagram account @beautyofwealth_ for hairstylists, estimates rising costs could mean roughly $5 less profit per client. At 16 clients a week, that is more than $4,000 a year.
Praznik framed the choice for companies bluntly. “If you withdraw from the market, someone else is likely to fill it,” he said. “So, the big question is, can you afford to give up that revenue?” And he warned of what is coming: “We’re in the early days of what is a big reorganization.”
Sources
- How Canadian tariffs on U.S. goods may affect your business
- How US-Canada Tariffs Could Disrupt the Beauty Industry’s Supply Chain
