Tariff Turmoil Hits Furniture as Canada, Mexico and China Duties Take Effect

Originally published March 3, 2025. This version was rebuilt from White House orders and fact sheets, the ISM manufacturing report and the Census Bureau's advance retail sales report for the FIN archive, and the facts are as of that date.

The first week of March 2025 turned tariff threats into tariff bills. Duties on the country's three largest trading partners were set to take effect at once, while furniture factories and stores were already running soft.

The short version

• The White House said it was proceeding with tariffs on Canada and Mexico under IEEPA.
• An order dated March 3 raised the China fentanyl tariff from 10% to 20%.
• ISM listed Furniture & Related Products among industries contracting in February.

Three borders at once

On March 3 the White House said it was proceeding with tariffs on imports from Canada and Mexico under the International Emergency Economic Powers Act, citing fentanyl and border security. The same day an order struck 10 percent and inserted 20 percent in the China fentanyl tariff, on top of the Section 301 duties already in place.

Furniture supply chains run through all three countries, from components and fabrics to finished goods. Importers faced higher duties on all three at the same time.

Update. On March 6 the White House exempted goods that qualify for USMCA preference, leaving 25% on non-qualifying goods. The Supreme Court later ruled that IEEPA does not authorize these tariffs.

Factories slow

The ISM manufacturing index was 50.3% in February, and the New Orders Index fell to 48.6%. The Prices Index jumped 7.5 points to 62.4%.

ISM listed Furniture & Related Products among the five industries reporting contraction in February, and among those with declining new orders and employment. Furniture makers were cutting back before the new tariffs even took effect.

Stores start soft

The Census Bureau's advance report showed furniture and home furnishings store sales down 1.7% in January from December but up 3.7% from a year earlier. Total retail and food services sales fell 0.9% for the month.

A weak start to the year, falling factory orders and higher import costs together pointed to a cautious spring, with retailers deciding how much of the new duties to pass on.

The quarter ahead

Furniture went into the second quarter of 2025 with tariffs on the country's three largest trading partners and soft demand at home. Pricing, sourcing and inventory decisions made in March would shape the rest of the year.

Related on FIN

• Follow the Tariff Dollars
• Furniture Orders Rose 9%. Factories Still Aren't Hiring for It.

Sources

• The White House, Fact sheet on tariffs on imports from Canada and Mexico (Mar. 3, 2025)
• The White House, Further amendment to duties addressing the synthetic opioid supply chain in China (Mar. 3, 2025)
• The White House, Fact sheet adjusting tariffs on Canada and Mexico (Mar. 6, 2025)
• Supreme Court of the United States, Opinion in Learning Resources, Inc. v. Trump (Feb. 20, 2026)
• Institute for Supply Management, Manufacturing PMI, February 2025
• U.S. Census Bureau, Advance monthly retail sales, January 2025