Canadian wool and yarn producers look to untangle themselves from the U.S.

U.S. President Donald Trump's tariffs have created a tangled web of complications for Canadian wool producers and hobbyists, leading some to sever ties with their American customers. Judy Enright Smith, owner of Wabi Sabi yarn shop in Ottawa, has had enough of the back-and-forth. She recalls a recent visit from her American supplier who wore an "Elbows Up" T-shirt, expressing her frustration with the situation.

The U.S. has imposed a 50% tariff on greasy wool imports and some finished wool products, impacting Canadian producers who send their raw wool south for scours, a process that removes impurities. Greasy wool, the raw material post-shearing, contains hay, bugs, and other barnyard materials along with lanolin, which is extracted for cosmetic use.

Canada's industrial processing capabilities are not on par with those of the U.S. or other nations, resulting in Canadian producers often relying on foreign mills to transform the raw wool into yarn and other products. More Canadian producers are now shipping their raw wool to China and the Czech Republic to avoid U.S. tariffs and trade tensions.

Matthew Rowe, chair of the Canadian Wool Council, laments the rupture in a long-standing trading relationship during a period of rising wool prices, adding that Canada's top market, the U.S., is now closed to them. Enright Smith has decided to stock European products instead and is seeking more Canadian-made wool. One Canadian mill, Briggs and Little in New Brunswick, operates independently from U.S. tariffs as it processes wool entirely within Canada.

However, even this mill is not entirely immune, as it uses some U.S.-made parts and materials subject to tariffs. Another Canadian wool mill owner, Anna Hunter, has stopped shipping to the U.S. following the cancellation of the de minimis exemption for imports. She envisions a new domestic wool industry with decentralized regional processing facilities to support a more robust domestic textile industry.

Hunter emphasizes the need for Canadian knitters to start thinking of wool as a commodity worth investing in and to buy local. The Canadian wool industry faces the challenge of ramping up mill capacity and changing consumer perceptions of wool. If the tariff dispute isn't resolved soon, it will be a particularly tough fall for producers as shoppers prepare for winter wardrobes.