The Canadian government has announced that it will extend key steel and aluminum tariff measures for one year in order to support domestic workers and businesses, while maintaining protection against steel trade diversion, non-market practices and global excess capacity.
According to a statement released by the Department of Finance, Canada will extend its steel tariff-rate quota regime for imports from non-CUSMA partners until June 27, 2027, while the existing horizontal tariff relief for eligible steel and aluminum products from the US, as well as for eligible steel products subject to derivative tariffs, will be extended until June 30, 2027.
The Department of Finance Canada stated that the extension will provide producers and importers with greater business predictability and longer-term certainty, while helping the government defend the Canadian steel industry and its workers against the impact of trade flows driven by excess capacity and unfair market conditions.
Under the current framework, quota levels will remain based on 20 percent of 2024 import volumes for partners without a free trade agreement with Canada and 75 percent of 2024 import volumes for partners that have a free trade agreement in force with Canada, while imports exceeding the quota limits will continue to be subject to a 50 percent tariff. Canada will also continue to exempt the US and Mexico from the steel tariff-rate quotas.
Following the planned extension, the government intends to consider an allocations-based approach for the administration of quotas for certain product classes, with producers and importers expected to be invited to share their views as part of the ongoing review of the tariff-rate quota framework.