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Canada’s steel industry warned of “catastrophic” job losses, factory slowdowns and supply chain disruption after US President Donald Trump doubled tariffs on imports to 50 per cent.
Trump’s latest tariff move sparked anger across the border, as Canada’s Prime Minister Mark Carney had only last month travelled to the White House to repair relations frayed after Washington imposed heavy levies on its biggest trading partner.
Canada is the largest supplier of steel and aluminium to the US, accounting for nearly a quarter of US steel imports in 2023 and about half of aluminium imports last year.
“A 25 per cent tariff is difficult, but a 50 per cent one is catastrophic,” said Catherine Cobden, president of the Canadian Steel Producers Association.
Steel is a C$15bn (US$11bn) industry that employs 23,000 Canadians and supports an additional 100,000 indirect jobs, according to the CSPA.
“Steel tariffs at this level will create mass disruption and negative consequences across our highly integrated steel supply chains and customers on both sides of the border,” said Cobden.
As newly elected prime minister, Carney went to the Oval Office in early May hoping to reset relations damaged by Trump’s threats to annex Canada and hit it with 25 per cent tariffs.
The two leaders said they were open to renegotiating the US-Mexico-Canada Agreement, a trade deal that succeeded the North American Free Trade Agreement during Trump’s first term and is up for review next year.
But on Friday, Trump told a rally in West Mifflin, Pennsylvania, that he would double steel and aluminium tariffs to 50 per cent, in an escalation of his global trade war.
Cobden said Trump’s new threat “essentially closes the US market” to Canada and will “have unrecoverable consequences”.
The Aluminium Association of Canada said they were waiting for “clearer and more formal legal confirmation” before commenting on the potential implications.
International trade minister Dominic LeBlanc said Canada remained “resolute” in defending its workers and communities.
“As we negotiate a new economic and security relationship with the US, Canada’s new government will stand strong to get the best deal for Canadians,” he said in a post on social media platform X on Saturday.
The tariff announcement came in the same week Trump said it would cost Canada $61bn to be part of his ambitious “Golden Dome” missile defence shield but would be free if Ottawa gave up its sovereignty to become the 51st US state.
A spokesperson said Carney “has been clear at every opportunity, including in his conversations with President Trump, that Canada is an independent, sovereign nation, and it will remain one”.
The US president unveiled the increased levies on Friday as he touted a $15bn partnership between Nippon Steel and US Steel at a rally in Pennsylvania, promising to erect a tariff “fence” around domestic metals production.
The new levies will come into effect on Wednesday, the president wrote in a Truth Social post following the event.
Earlier in the week, a US federal appeals court paused a ruling that deemed Trump’s “liberation day” tariffs illegal.
Canada has announced “a dollar-for-dollar” response to the US tariffs that will affect steel products worth C$12.6bn, aluminium products worth C$3bn and additional US goods worth C$14.2bn.
These tariffs launched in March are on top of initial retaliatory levies on C$30bn of US goods. But in mid-April, Canada quietly softened its stance by easing some of the countermeasures on US carmakers and manufacturers.
Canada’s ministers and provincial leaders are meeting in Saskatoon, Saskatchewan province, on Monday as part of Carney’s efforts to diversify the economy away from over-reliance on the US.
“This isn’t trade policy, it’s a direct attack on Canadian industries and workers,” said Marty Warren, the United Steelworkers’ national director for Canada.
“Thousands of Canadian jobs are on the line, and communities that rely on steel and aluminium are being put at risk. Canada needs to respond immediately and decisively to defend workers.”
Goldy Hyder, president of the Business Council of Canada, said it was best “not to take the bait” from Trump’s statements and stay focused on a renewal of the USMCA.
“These moving goalposts is just a strategy to try and get Canada to give more,” he said.
