Amid mounting global steel trade tensions and possible trade diversions, Canada is stepping up to defend its domestic steel sector. Mark Carney, prime minister of Canada, has unveiled a comprehensive strategy to stabilize the market, shield Canadian steelworkers, and inject new investment into domestic production. The plan includes tough import restrictions, direct industry funding, and procurement reforms to prioritize Canadian steel in major national projects.
Major import restrictions to prevent trade diversion
Canada will tighten the tariff rate quota levels for steel products from non-FTA countries to 50 percent of 2024 volumes with the countries being subject to 50 percent tariff if above quota levels, it will introduce a tariff rate quota level for steel products from FTA partners (excluding US) at 100 percent of 2024 volumes and apply a 50 percent tariff on steel imports above those levels. The changes to tariff rate quotas will take effect in the coming days. Canada will also implement 25 percent additional tariffs on steel imports from all non-US countries containing steel melted and poured in China before the end of July.
Meanwhile, the government is reviewing its remission framework to favor the use of Canadian steel in Canadian-made products. Also, Canada will reassess its existing steel trade arrangements, consistent with progress made in the bilateral discussions with the US and taking into account broader steel negotiations.
Strengthening Canada’s steel workforce
The government will invest significantly to ensure Canada’s transition toward a resilient steel ecosystem. Allocating $70 million to Labor Market Development Agreements; providing $1 billion for the Strategic Innovation Fund to help steel companies scale competitive domestic production and create jobs; enhancing the Business Development Bank of Canada Pivot to Grow initiative to provide support to eligible steel small and medium-sized enterprises facing liquidity challenges are among these investments.