US-Canada trade war: Steel and aluminum producers warn tariffs will damage industries

The Canadian Steel Producers Association has warned of “devastating repercussions” for the future of North American industries amid the escalating US-Canada trade war. Meanwhile, the US Aluminum Association says it supports President Trump’s efforts to strengthen the US industry but wants tariff-free access to Canadian aluminum, emphasizing the need for a reliable and affordable metal supply to sustain growth.

Last week, the Canadian government responded to the US’ 25% tariffs on all Canadian steel and aluminum products. Following a “dollar-for-dollar” approach, Canada imposed 25% reciprocal tariffs on a list of steel products worth CA$12.6 billion (~US$8.76 billion) and aluminum products worth CA$3 billion (~US$2.087 billion). 

It furthermore imposed import tariffs on additional US goods worth CA$14.2 billion (~US$9.88 billion), for a total of CA$29.8 billion (~US$20.75 billion). 

These latest retaliatory tariffs come in addition to Canada’s 25% counter-tariffs on CA$30 billion (~US$20.874) of imports from the US, which were implemented on March 4 in response to the US International Emergency Economic Powers Act (IEEPA) tariffs.

US aluminum affordability

The US aluminum industry has reportedly invested more than US$10 billion since 2016, mostly in mid- and downstream production and recycling. This investment has been driven by growing demand, a competitive tax environment, and strong, targeted trade enforcement the president supported in his first term, according to US Aluminum Association’s president and CEO, Charles Johnson.

“For this growth to continue, the US aluminum industry needs two things: long-term market certainty and a reliable supply of affordable metal, which today comes in large part from Canada,” he tells Packaging Insights.

The US-Canada trade war will severely harm North America’s steel industry, warns Cobden.The Aluminum Association represents the full value chain of aluminum production and jobs in the US, including companies that make 70% of the aluminum and aluminum products shipped in North America.

“President Trump’s administration is aggressively pursuing multiple tariff initiatives on behalf of the broader US economy. The US aluminum industry needs certainty in this tariff landscape to support our growth and investment,” reiterates Johnson. 

“This action closes loopholes in existing Section 232 tariffs that will support our industry’s expansion. However, we encourage President Trump and his administration to deliver a deal with Canada to ensure robust metal supply for US manufacturers and consumers as he did in his first term.”

Canadian steel concerns

Meanwhile, the Canadian Steel Producers Association’s president and CEO, Catherine Cobden, says that the US tariffs have “deeply damaged” the trading relationship between Canada and the US. 

“These tariffs will have devastating repercussions on both sides of the border for workers and communities that rely on a strong North American steel industry. Indeed, many are already feeling the impacts.”

“We welcome the announcement of Canada’s retaliatory tariffs, as well as ongoing efforts by the government to resolve this trade war. However, we remain deeply concerned about the significant disruption and ongoing uncertainty being created by the US for our industry.”

Cobden says that to build resiliency and long-term prospects for the sector in Canada, it is calling on the government to act with urgency to address long-standing concerns around “unfair trade within our own borders.”

She urges Canada to enact tariffs on all steel and steel derivatives from China and “other known trade offenders” to address “unfair” steel trade in Canada.

“As witnessed by Canadian trade cases, there remains significant levels of ‘dumping’ and other unfair practices which erode our industry’s ability to compete.”The Canadian government says it will continue releasing counter-tariffs if the Trump administration does not back down.

“We ask all municipal, provincial, and federal governments to step up and ensure they are prioritizing Canadian steel in all their publicly funded infrastructure projects. This would be a strong and timely show of support for Canada’s steel industry and the workers and communities that depend on it. We are long overdue for ensuring that Canadian-made steel is being prioritized for domestic projects.”

Canada threatens further tariffs

The Canadian government says that unless the US IEEPA tariffs and other “unjustified” US tariffs are addressed, the country will apply counter-tariffs on additional imports from the US on April 2, following the public comment period. The scope could also be increased further, if new tariffs are imposed, warns the government.

It furthermore plans to mitigate the impact of these countermeasures on Canadian workers and businesses by ensuring that its recently established remission process will consider requests for exceptional relief from these new tariffs.

“While we urge the US administration to reconsider their decision to impose tariffs, Canada will remain firm in standing up for our jobs, our industries, and our workers,” says the government.

“In the weeks and months ahead, additional measures will be brought forward to support businesses and workers as needed. The federal government will also continue to work closely with provinces and territories to ensure complementary support is in place across all jurisdictions.”