Steel and aluminum tariffs may rise if no deal is reached by July
Canada warned on Thursday it could raise tariffs on U.S. steel and aluminum as early as July 21 if trade negotiations with the Trump administration do not yield results. The move would see existing 25% counter-tariffs increased in response to America’s ongoing 50% metal import duties.
“We must safeguard Canadian workers and businesses from the unjust U.S. tariffs that exist at present,” said Prime Minister Mark Carney at a press conference. Talks between the two countries are ongoing, with a provisional deadline set for mid-July.
Canada introduces new rules to protect domestic industry
Alongside the potential tariff increase, Ottawa announced new procurement rules for federal projects, mandating the use of Canadian-produced steel and aluminum or that from countries with reciprocal trade agreements. The government will also establish tariff-rate quotas to restrict imports from non-trade-agreement countries.
These changes aim to counter the risk of dumping, as Canada fears global producers might reroute their shipments to avoid U.S. tariffs. “The quotas are a consequence of the U.S. actions,” Carney said.
Trade tensions lift Canadian steel stocks
Shares of Algoma Steel Group Inc. surged as much as 7.9% on the Toronto Stock Exchange following the announcement, reaching C$9.85 — the highest level since March. The rally underlines investor optimism that domestic producers will benefit from stricter import controls.
Carney emphasized Canada’s readiness to support businesses affected by market instability, referencing a C$10 billion federal loan facility to aid firms struggling to secure traditional financing.
Ongoing talks, but no guarantee of compromise
While Carney confirmed ongoing communication with President Donald Trump, he left the door open to walking away if a trade agreement fails to align with Canadian interests. “It’s a negotiation,” he said. “If it’s in Canada’s interest, we’ll sign it. If it’s not, we won’t.”
Cabinet ministers Dominic LeBlanc and Melanie Joly joined Carney during the announcement. LeBlanc noted he is in regular contact with U.S. officials, including Commerce Secretary Howard Lutnick and Trade Representative Jamieson Greer.