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

Canadian wool and yarn producers are grappling with the consequences of U.S. President Donald Trump's tariffs, which have disrupted their supply chains and led many to seek alternative markets. Judy Enright Smith, owner of Wabi Sabi yarn shop in Ottawa, has had enough of the red tape and extra costs imposed by the tariffs. She is now looking to Europe for a replacement customer base and plans to distance herself from U.S. labels in her store.

The U.S. has imposed 50% tariffs on greasy wool imports and certain finished wool products, impacting Canadian wool producers who ship their greasy wool south for scoured processing. Canada lacks the same level of industrial processing facilities found in the U.S., meaning many Canadian producers rely on foreign mills to transform their raw wool into yarn and other products. Some Canadian producers are now shipping their wool to China and the Czech Republic to avoid the U.S. tariffs and trade tensions.

Matthew Rowe, chair of the Canadian Wool Council, describes the situation as an "unfortunate rupture" in a long-standing trading relationship, particularly at a time when wool prices are rising. Enright Smith is frustrated that stocking U.S. labels in her store no longer makes moral sense, despite their popularity with some customers. She is actively seeking alternative sources of wool products in Canada.

One Canadian mill, Briggs and Little in New Brunswick, is partially insulated from the tariffs as it processes wool entirely within Canada. However, the oldest operating Canadian mill still faces some tariffs due to the use of U.S.-made parts and materials. Industry leader Anna Hunter of Long Way Homestead in Manitoba is contemplating a major shift in the Canadian wool industry, envisioning a new system based on decentralized regional processing facilities to support a more robust domestic textile industry.

Hunter argues that decoupling Canadian wool from the U.S. will require a change in mindset, recognizing wool as a valuable commodity worth investing in, rather than merely a byproduct of the sheep industry.