The Importance of the US-Mexico-Canada Agreement for Idaho

1Why USMCA Matters for Idaho

The United States–Mexico–Canada Agreement (USMCA) underpins Idaho’s trade relationships with its two largest regional partners. Together, Canada and Mexico account for 40% of Idaho’s goods exports and one-six of its goods imports, and purchase nearly a half a billion dollars of Idaho services exports. In total, trade with Canada and Mexico supports about 75,000 Idaho jobs.

WCIT championed USMCA as the successor to the North American Free Trade Agreement (NAFTA) because of its improvements it made, while ensuring continued tariff-free access for exporters and stabile supply chains for importers. More recently, USMCA has significantly mitigated the impact of new federal tariff actions. As the statutory 6-year USMCA review begins, WCIT’s top priority is the continuation of the USMCA and to ensure we “do no harm” to the integrated supply chains that have grown over the past 33 years of North American partnership.

2Exports to Canada & Mexico

The USMCA remains vital for keeping Idaho exporters competitive in Canadian and Mexican markets. From April 2025 to March 2026, 40% of Idaho’s total goods exports went to these two partners. Businesses exported $1.6 billion in goods to Canada (33% of total exports) and $311 million to Mexico (6%). Yet exports have struggled recently with exports to Canada down 12% and exports to Mexico down 3% compared to the year ending in March 2025. Uncertainty around the outcomes of USMCA negotiations could further undermine Idaho companies’ export performance.

Figure 1. Idaho goods exports to Canada and Mexico (rolling 12 months, Dec. 2020–Mar. 2026).

From April 2025 to March 2026, top goods exports to Canada included lead concentrates, live bovine animals, fertilizers, clad precious metal articles and butter. While lead concentrate and bovine animals experienced notable growth, most export categories fell from the previous 12-months period. Among the top five exports to Canada, clad precious metal articles saw the steepest decline: from $273 million in the year ending in March 2025 to $117 million in the most recent 12 months. Other leading exports experienced moderate decline: fertilizers exports decreased by 10% and butter exports fell by 12%. Gold exports fell from $73 million in the year ending in March 2025 to just $9,537 in the most recent 12 months, which is why it no longer ranks among the top five exports to Canada.

Leading goods exports to Mexico included prepared frozen vegetables, wheat, seeds, potatoes and wheat flour. Seeds and potatoes experienced some growth and other leading exports experienced moderate decline. The top five export products to Mexico remained the same for the year ending in March 2025 and the most recent 12 months. While no individual dairy product cracked the top five exports, collectively they are a major export category. Idaho’s exports to Mexico included $8 million in cheese and curd exports, $7 million in in whey exports, and $6 million in milk and cream exports for the year ending in March 2026.

Some products are especially reliant on Canadian and Mexican markets. Between April 2025 and March 2026, Idaho exported $1.4 billion worth of goods for which at least 90% of total exports went to Canada and Mexico. These highly dependent exports include lead concentrate, bovine animals, clad precious metal articles, phosphoric acid, and zinc concentrate.

Idaho also relies on Canada and Mexico for services exports. In 2024, services trade to these partners totaled $453 million, led by personal travel, business travel, freight & port services, industrial processes, and technical services.

3Imports & Tariff Protection

The USMCA is equally critical for imports. While theoretically enabling tariff-free access from Canada and Mexico, tariff costs have spiked since early 2025. From April 2025 to March 2026, Idaho imported $1.2 billion in goods from Canada (14% of total imports) and $126 million in goods from Mexico (1.6%). Of Idaho’s imports from Canada and Mexico from April 2025 to March 2026, an estimated $1.1 billion (82%) claimed USMCA. This led to significant direct tariff savings of about $26 million, though they are partially offset by $11 million in estimated Section 232 tariff payments on USMCA-claiming imports.

Yet USMCA’s indirect benefits are even more significant following the imposition of tariffs of up to 25% on Mexico and 35% on Canada for imports that did not comply with USMCA rules. As clearly shown in the graph below, USMCA-claiming imports have risen sharply even as total imports have fallen.

Figure 2. Idaho goods imports from Canada and Mexico — USMCA-claiming vs. non-claiming — with average tariff rate (Jan. 2020–Mar. 2026).

Much of the new claims can be attributed to products that previously faced no tariffs (e.g., lead, certain wood products) or very low tariffs (e.g., oilcake) regardless of the country of origin. While tariff reductions historically did not justify the compliance costs of claiming benefits, avoiding the IEEPA tariffs made it worthwhile. Despite the carveout for USMCA-compliant imports, Idaho businesses paid an estimated $6.3 million in extra IEEPA tariffs on imports from Canada and Mexico in the 12 months ending in March 2026.

While the IEEPA tariffs were struck down, high USMCA claim rates could continue if the exemptions for USMCA-claiming imports are extended to future tariffs. IEEPA was immediately replaced by 10% Section 122 tariffs. The IEEPA tariff exemptions, such as for USMCA-eligible goods, were continued. The lower Section 122 rates and high USMCA-claim rates limited Section 122 costs to an estimated $345,000 in March 2026.

Imports subject to Section 232 tariffs have not been so fortunate and remain fully subject to higher tariff rates, regardless of whether they meet USMCA rules. In total, Idaho businesses paid $9.1 million in additional tariffs on steel and aluminum, $1.5 million on timber and lumber, and $774,000 on autos and auto parts between April 2025 to March 2026. Pending Section 232 investigations threaten tariffs on billions more in imports, including $90 million in imports on the critical minerals 232 list and over $5 million in imports on other Section 232 lists.

Imports from Canada and Mexico also could be affected by new Section 301 investigations into structural excess capacity and enforcement of forced labor prohibitions, though for now it seems likely that any new Section 301 tariffs would include a carveout for USMCA-compliant goods.

From April 2025 to March 2026, top goods imports from Canada included oilseed meal, lumber, prepared frozen vegetables, sulfur and particle boards. Lumber has seen the largest tariff due to the Section 232 tariffs imposed.

Leading goods imports from Mexico during the period from April 2025 to March 2026 included prepared fruits and nuts, tractors, melons and papayas, construction machinery parts, and paper and paperboard. Tractors and construction machinery parts saw the large tariff increases, though for the rise for construction machinery parts also reflects a big jump in import values.

Certain products are sourced almost exclusively from these partners. Between April 2025 and March 2026, Idaho imported $418 million worth of goods for which Canada or Mexico was the sole supplier.

Key imports into Idaho where Canada accounts for a very high share include oilseed meal, sulfur, firearm parts, kraft pulp and bovine meat.

Similarly, Idaho is particularly dependent on imports of prepared fruits and nuts, tractors, melons and papayas, plastic monofilaments and car bodies from Mexico.