Tennessee sold about $6.4 billion in goods to Canada last year. That does not mean all $6.4 billion is exposed to Canada’s coming retaliation.
By The Redemption Project Newsroom
Economy / Trade Desk
NASHVILLE, Tenn. —
Canada is not a distant trading partner for Tennessee.
It is the state’s largest foreign customer.
Tennessee exported approximately $37.7 billion in goods worldwide in 2025, according to the Office of the U.S. Trade Representative. About $6.4 billion went to Canada — roughly 17% of everything Tennessee exported.
Canada finished ahead of Mexico, the Netherlands, China and Japan as a destination for Tennessee goods.
That makes the escalating U.S.-Canada trade dispute a Tennessee story.
But it does not make every dollar of Tennessee’s Canadian exports a tariff casualty.
The useful question is narrower:
Which Tennessee products are actually exposed?
The latest tariffs work in two directions
On Aug. 22, the United States imposed additional 50% tariffs on roughly $20 billion worth of Canadian goods after a three-day suspension intended to give negotiations more time.
The Trump administration says the measures respond to Canadian treatment of U.S. alcoholic beverages, dairy products and motor vehicles. The White House’s proclamations target specific tariff lines and contain exclusions, including for certain products already covered by Section 232 tariffs.
Canada has announced that it will respond with dollar-for-dollar countertariffs beginning Sept. 8.
Prime Minister Mark Carney said the retaliation will be concentrated in sectors including steel, dairy, appliances, agricultural equipment, pulp and paper and electronics. Canadian officials said the detailed product list would follow.
That last point matters.
As of Aug. 24, Canada has announced the sectors it intends to target.
It has not yet published the complete product-by-product tariff schedule for the new Sept. 8 measures.
For Tennessee, the two directions of the trade fight should not be confused.
When the United States taxes a covered Canadian import, the U.S. importer generally pays the customs duty. A Tennessee manufacturer buying a Canadian component may therefore face a higher input cost, depending on the product, contract terms and whether that cost is passed through the supply chain.
Canadian countertariffs work in the opposite direction.
A Canadian importer bringing a covered Tennessee-made product into Canada would generally face the Canadian duty. The importer could absorb the cost, pass it to Canadian customers, push the Tennessee supplier for a lower price or buy elsewhere.
That is how a tariff imposed in Ottawa can reach a factory in Tennessee.
And Canada’s promise to retaliate “dollar for dollar” does not necessarily mean imposing the same tariff rate on identical products.
It refers to matching the overall scale of the U.S. trade action.
What Tennessee actually sells
Tennessee’s export economy is heavily industrial.
The state’s worldwide export profile is led by computer and electronic products, which accounted for about $9.3 billion in 2025.
Transportation equipment accounted for about $5 billion, chemicals about $4.9 billion, and machinery excluding electrical equipment about $2.6 billion.
Those figures show what Tennessee makes for the world.
They do not tell us what Canada is about to tax.
That requires a more specific dataset.
A Canadian government trade profile identifies automobiles, optical and medical instruments, vehicle parts, computers, telecommunications equipment, plastics, food products, iron and steel products, rubber goods and machinery among Tennessee’s important exports to Canada.
Those categories provide a useful map of the relationship.
They do not yet provide a tariff bill.
The $6.4 billion cannot simply be labeled “at risk”
This is where the numbers require discipline.
Tennessee exported $6.4 billion in goods to Canada last year.
That is the size of the entire relationship.
It is not the amount Canada has announced it will tariff.
Likewise, Tennessee’s $9.3 billion in worldwide computer and electronic exports cannot be treated as Canadian tariff exposure.
Most of those exports went somewhere other than Canada.
The same is true for transportation equipment, chemicals and machinery.
A defensible Tennessee exposure estimate requires at least two things:
Canada’s final Sept. 8 tariff schedule.
And Tennessee-to-Canada export data matched against those tariff classifications using Harmonized System product codes.
Then analysts would have to account for exemptions, overlapping sector-specific tariffs and other special treatment.
Until that crosswalk exists, there is no responsible basis for saying that Tennessee has $6.4 billion — or $9.3 billion, or $5 billion — “subject to Canadian tariffs.”
The actual figure may be substantially smaller.
We can identify likely exposure zones before we know the final number
That does not mean Tennessee has to wait before asking where the first risks may appear.
Canada has said its new retaliation will concentrate on steel, dairy, appliances, agricultural equipment, pulp and paper and electronics.
Tennessee already exports industrial machinery, electronics and metal products to Canada.
That overlap makes those sectors worth watching.
It does not prove every product within them will be tariffed.
The tariff code still matters more than the category headline.
Automobiles and auto parts require their own analysis.
They represent an important part of Tennessee’s Canada trade, but both countries already maintain separate sector-specific tariff structures affecting vehicles and parts.
The current U.S. Section 338 motor-vehicle proclamation itself excludes certain articles already subject to Section 232 duties.
Canada also maintained earlier countertariffs on autos, steel and aluminum even after removing many other retaliatory tariffs in 2025.
That means a new Canadian retaliation package cannot simply be treated as a clean additional layer on every Tennessee-built vehicle or component.
Again, the product code matters.
The next Tennessee story is about companies, workers and orders
Trade figures can establish the scale.
They cannot tell us how Tennessee businesses are responding.
Those questions now belong with the people buying, making and selling the products.
Are Tennessee manufacturers already paying more for Canadian inputs?
Are exporters accelerating shipments before Sept. 8?
Have Canadian customers delayed orders?
Are Tennessee suppliers being asked to lower prices to offset duties?
Can manufacturers find different suppliers or customers?
Which Tennessee industries believe they are insulated?
Which are already preparing for retaliation?
Those answers will require manufacturers, farmers, trade economists, chambers of commerce and elected officials to move the discussion from tariff policy to what is actually happening on the ground.
For now, Tennessee knows the size of the relationship.
Canada buys about one out of every six dollars of goods Tennessee sends abroad.
What Tennessee does not yet know is how much of that relationship sits directly in the line of fire.
Canada has announced the sectors.
The product list is still coming.
Once it arrives, the next step is straightforward:
match Tennessee’s exports against it, tariff code by tariff code.
That is when Tennessee will finally know how much of its largest foreign market is actually exposed.
I am a retired detective and criminal justice / government educator based in Tennessee. I founded The Redemption Project, as a place to focus on civics, rebuild non-partisan trust, and provide educational and emotional grace while learning about the news. I also have a column in Knox TN Today. My reporting and commentary have also appeared in other outlets including; Governing, The Arizona Capitol Times, South Florida Sun Sentinel, Police1, among other state and regional outlets.
