Canada will impose a 25% tariff on U.S. toilet paper and facial tissue, along with 50% duties on paper towels, napkins and raw wood pulp, as part of retaliation for Washington’s 50% tariff on roughly $20 billion of Canadian goods. The measures, covering close to 900 American products, take effect September 8 after U.S.-Canada trade talks broke down in late August 2026. The dispute revives memories of the COVID-19 toilet paper shortage, when sales jumped 734% on March 12, 2020, and about 70% of grocery stores worldwide experienced shortages despite mills continuing production. Canada supplied $328 million of U.S. toilet paper in 2024, while Canadian northern bleached softwood kraft pulp (NBSK), a key paper-making input, accounts for roughly 30% of a standard U.S. toilet paper roll and nearly half of U.S. paper towel production. Procter & Gamble said the tariffs represent a roughly $0.25-per-share earnings headwind and is raising prices on part of its product range. Ottawa has announced a C$7.5 billion relief package for affected small and medium-sized businesses, while the American Forest & Paper Association says any shortages are more likely to be localized and urges consumers not to stock up. The wider dispute includes Canadian duties on U.S. dairy, fish and seafood, U.S. tariffs on Canadian cars and auto parts, and President Donald Trump’s threat to raise the auto tariffs to 50% if no agreement is reached by January 1, 2027. The tariff pressure comes as Trump’s economic standing weakens ahead of the midterm campaign season: 39% of Americans approve of his job performance, 30% approve of his handling of inflation, and 31% name inflation and prices as their top concern.