Canada 50% Tariff List Changes (World Briefing 10/26)

From 30 October the US will change which Canadian products face its 50% additional duty under Section 338 of the Tariff Act of 1930. Plywood sheets, some paper products, certain machinery and refrigeration equipment, and certain packing crates come off the list, while certain valves, carpets and waste products go on. In the same week, Drewry’s World Container Index hit a 15-week high, and tanker freight out of the Middle East remains steep. Check HS codes on any Canada-linked cargo first, then the validity and surcharges on your freight quotes.

Key takeaways

• Canada duties: a Section 338 proclamation signed on 23 October changes the scope of the 50% duty from 30 October. It applies regardless of USMCA origin and on top of Section 232 tariffs.
• Container rates: the Drewry WCI rose 2% to $4,585 per 40ft container on 22 October, the highest in 15 weeks.
• By route: Shanghai–Los Angeles $8,007 (+2%), Shanghai–New York $10,166 (+1%), Shanghai–Rotterdam $3,632 (+3%), Shanghai–Genoa $4,152 (+5%).
• Tankers: Kpler says Middle East Gulf–China VLCC freight has reached $24 a barrel, or 25% of the FOB crude price.

Top stories

What changes in the US 50% duty on Canadian goods?

Some products leave the list and others join it. According to the White House, plywood sheets, some paper products, certain machinery and refrigeration equipment, and certain packing crates and boxes are removed, and certain valves, carpets, waste products and others are added. The changes take effect on 30 October 2026.

The action further amends Proclamation 11048, the motor-vehicle-related Section 338 duty announced on 20 July and modified on 8 September. The duty applies whether or not goods qualify under USMCA, and it stacks on Section 232 tariffs. Check the exact HTS codes in the proclamation’s annex. Earlier context is in the 10/24 briefing.

Source: White House fact sheet

Why are container rates at a 15-week high?

US import demand is supporting Transpacific rates, while carriers are cutting Asia–Europe capacity with blank sailings. The Drewry WCI rose 2% to $4,585 per 40ft container on 22 October, its second weekly gain in a row.

Drewry says Asia–Europe blank sailings rise from two this week to eight next week, so it expects rates there to edge up. Transpacific blank sailings fall from six to two, and it expects those rates to hold steady. Vessel waiting time at Shanghai fell from 97 hours in week 38 to 38 hours in week 42. Only two containerships sailed into the Gulf in week 42, down from five the week before.

Source: Drewry World Container Index

How much Hormuz risk is priced into tanker freight?

Kpler puts Middle East Gulf–China VLCC freight at $24 a barrel and Gulf of Oman loadings outside the Strait at $12 a barrel. Freight now makes up 25% of the FOB crude price for Gulf loadings, up from 17% at the start of the conflict and about 5% before the war.

Kpler notes that shuttle tanker operations under US Navy escort keep barrels moving, so flows have not collapsed. If attacks continue at the current pace, it expects the market to adjust through lower loadings rather than much higher rates. Importers of oil and chemical feedstocks should account for freight’s larger share of landed cost.

Source: Kpler

Practical implications for trade

• Customs: if you ship or source Canadian goods for the US, check before 30 October whether your HS codes are on the added or removed lists (see our HS code guide).
• Freight: Asia–Europe rates may rise further as blank sailings increase. Check quote validity and the surcharge reference date.
• Costs: the won closed at 1,324.6 per dollar in Seoul on 23 October. Freight swings may move import costs more than the exchange rate.
• Contracts: with duties and freight changing quickly, revisit who bears which cost under your Incoterms (see Incoterms 2020 summary).

What to check now: Section 338 coverage of any Canada-linked goods, spot quotes and blank-sailing schedules on key routes, and freight and insurance terms for Middle East feedstocks.

FAQ

Does USMCA origin exempt goods from the Section 338 duty?

No. The White House says the duty applies to all covered goods regardless of USMCA origin. Where Section 232 tariffs apply, it is charged on top of them.

Where can I find the updated product list?

The HTS codes are listed in the proclamation’s annex. It is safest to also check the Federal Register version and US Customs and Border Protection (CBP) guidance.

Will container rates keep rising?

Drewry expects Asia–Europe rates to rise slightly next week and Transpacific rates to stay stable. That is a forecast, so confirm with live quotes.

Sources

• https://www.whitehouse.gov/fact-sheets/2026/10/fact-sheet-president-donald-j-trump-further-modifies-canadian-products-subject-to-tariffs-under-section-338/ (White House, Section 338 scope change)
• https://www.drewry.co.uk/supply-chain-advisors/supply-chain-expertise/world-container-index-assessed-by-drewry (Drewry, WCI 22 Oct)
• https://www.kpler.com/blog/crude-tanker-rates-hit-new-highs-as-hormuz-risk-escalates (Kpler, Gulf tanker freight)
• https://biz.chosun.com/policy/policy_sub/2026/10/23/JC27V3YJONBVLGMKBWVJWA5NOU/ (Chosun Biz, won close on 23 Oct)