Canada’s retaliatory tariffs on U.S. goods took effect just after midnight on Tuesday, escalating a trade dispute with its largest trading partner as negotiations between the two countries remain stalled.

The counter-tariffs cover about $20 billion worth of U.S. goods, with duties ranging from 15% to 50% on products including steel, furniture, clothing and electronics.

The measures are a dollar-for-dollar response to tariffs imposed by U.S. President Donald Trump on Canadian goods last month. The latest escalation has heightened concerns over the future of the United States-Mexico-Canada Agreement (USMCA), which is facing annual reviews after Trump declined to extend the pact for another decade.

Canadian and U.S. officials have blamed each other for the collapse of trade negotiations that appeared close to an agreement several weeks ago.

Michael Harvey, executive director of the Canadian Agri-Food Trade Alliance and a member of Prime Minister Mark Carney’s advisory committee on U.S. economic relations, warned that the dispute could trigger an “escalatory spiral,” while acknowledging the Canadian government’s need to maintain leverage.

Trump’s tariffs have already affected Canadian exports including wine, furniture, dairy products, cement, clothing, fishing equipment and hockey gear. The measures cover about $20 billion, or roughly 5%, of Canada’s exports to the United States.

Canada has sent nearly 68% of its total exports to the United States this year, according to government data. About 80% of those shipments have moved duty-free under USMCA exemptions, providing some protection to the Canadian economy.

However, the new U.S. tariffs were imposed under a Depression-era law that does not provide the same USMCA exemptions, adding to uncertainty over investment and economic growth.

Carney said last week that Canada remains prepared to reach a trade agreement that benefits both countries. But a Canadian government source said there are currently no negotiations between ministers or government officials.

Trump has also threatened to raise tariffs on Canadian cars, trucks and auto parts to 50% from Jan. 1, adding further pressure to the already strained bilateral trade relationship.