Canada curbs steel imports to shield domestic industry from Trump tariffs

Canada will restrict tariff-free import of cheap, foreign steel to help domestic manufacturers reeling from levies imposed by the US, Prime Minister Mark Carney has announced.

Speaking at a news conference in Ontario, Carney also pledged to diversify its trading partners away from the US and prioritise the use of Canadian steel.

The announcement comes in the wake of punitive tariffs imposed by President Donald Trump - first a 25% levy on Canadian steel in March, later doubling it to 50% in June.

On Tuesday, the prime minister raised the possibility that US tariffs may remain in place even after a bilateral agreement.

Speaking to reporters on Wednesday, Prime Minister Carney noted that imports currently accounted for nearly two-thirds of Canada's steel consumption, while over 90% of Canadian steel exports were destined for the US - a level of dependency he described as "unsustainable".

Under the new measures, the government will tighten its tariff rate quotas - from 100% to 50% of 2024 steel import volumes from countries without free trade agreements with Canada.

Any imports exceeding that limit will face a 50% tariff.

Carney also targeted China in his announcement, saying there would be an additional tariff on steel imports from non-US countries "containing steel melted and poured in China".

He added that there will be no changes to the products that are exempt under the Canada-US-Mexico free trade agreement (Cusma).

The prime minister also pledged to change the federal government's policy to require contractors to use Canadian steel.

He added that Canada's "big projects" - such as the push to build more housing and to strengthen the defence sector - will use Canadian steel.

These changes will ensure Canadians are "giving ourselves far more than any foreign government can take away", he said.

Canada's steel and aluminium industries are among the hardest hit by Donald Trump's sector specific tariffs.

Catherine Cobden, the president and CEO of the Canadian Steel Producers Association, told CBC News that there had been a 30% fall in steel production since Trump first imposed his metal tariff in March.

"This is something we should have been doing all along, but it's fantastic to see that we are making progress," Cobden said referring to Carney's announcement.