Donald Trump is threatening to slap a massive 250% tariff on lumber and diary imports from Canada, as tensions continue to rise between the two North American neighbours. The threat comes despite the US President agreeing to expand the number of goods exempted from his new 25% levies on Canada and Mexico introduced last week.

The 78-year-old Trump accused Canada of “ripping off” Americans for years in a furious outburst on Friday. “Canada has been ripping us off for years on lumber and on dairy products,” he said in an Oval Office address Friday, citing Toronto’s 241% tariff on US dairy exports to the country.

“We’re going to charge the same thing. It’s not fair. It never has been fair, and they’ve treated our farmers badly.”

The US President added the levy may be enforced as earlier as the beginning of next week.

Trump’s remarks come just day after he held a “colourful” telephone conversation with Canada’s outgoing prime minister Justin Trudeau on Wednesday.

Trudeau told reporters that a trade war between the two allies was still likely in the foreseeable future, despite some targeted relief.

He said: “Our goal remains to get these tariffs, all tariffs removed.”

Canadian trade minister Mary Ng dismissed Trump’s accusations, saying they were “not true”.

She said that Trump’s proposed reciprocal tariffs on dairy and lumber are “completely unjustified.”

Ng told reporters: “I learned about it just as I was walking into this press conference.

“These tariffs if imposed in that order of magnitude is completely unjustified.”

Canada’s high levies on certain US dairy products only kick in if exports hit a certain quota, and are applied on sliding scale basis.

Some US politicians were left incensed when a trade dispute panel found in favour of Canada in a 2023 ruling, arguing that the high import taxes did not violate the United States-Mexico-Canada Agreement (USMCA) signed by Trump in his first term.

At the time, Wisconsin Senator Tammy Baldwin said: “Wisconsin dairy farmers work hard every day to bring world class products to market, and they deserve a level playing field with their global competitors.,” she said.

“This decision flies in the face of the agreement our country made with Canada and puts our Made in Wisconsin dairy products at a disadvantage.”