Canada to Curb Steel Imports to Soften Blow From US Tariffs

By Jacob Lorinc, Randy Thanthong-Knight and Mathieu Dion

Jul 16, 2025 (Bloomberg) –Canada will reduce the amount of foreign steel importers can bring into the country tariff-free, a move to help domestic producers suffering from US President Donald Trump’s levies on the sector. 

The government will tighten “tariff rate quota” levels for steel products made in countries that don’t have a free-trade agreement with Canada. Producers from those nations will be able to ship half of last year’s volumes — above that level, a 50% tariff will apply.

Steel-producing countries that have existing trade deals with Canada, such as South Korea, will have more flexibility. They’ll be allowed to ship steel up to 2024 levels before tariffs kick in. 

But there won’t be any change right now to tariffs on US steel, Prime Minister Mark Carney said Wednesday. His government is trying to strike a trade deal with the Trump administration ahead of an Aug. 1 deadline.

“The current trade situation with the United States, and unfair trade practices from other countries — that combination guts our steel industry,” Carney said at a press conference at a steel manufacturing plant in Hamilton, Ontario. “For Canada to build big things again, we need our steel industry to advance, not retreat.”  

Shares of Algoma Steel Group Inc. jumped 4.5% in Toronto, the biggest gain in a month. 

Canada’s steel producers have warned of dramatic job cuts after Trump hiked import taxes on foreign steel and aluminum to 50%. Already, the industry says it has significantly reduced shipments and faced close to 1,000 job losses. 

Canada has so far decided not to match those tariffs, keeping its retaliatory tax on US steel products at 25%. 

Carney said the US trade deals with other countries are going to include “very high tariffs” and that may push steel products into Canada’s comparatively open market. “It’s important that we protect our market from those secondary effects,” he said.

Catherine Cobden, chief executive officer of the Canadian Steel Producers Association, told BNN Bloomberg Television that the government measures are “a big move forward.” 

She applauded Carney’s decision to apply a 25% surtax on steel imports from all countries — except the US — that contain steel melted and poured in China. “It is huge,” she said about China’s production, with “hundreds of millions of tons of steel that they produce, that they do not need, that they then dump in markets like Canada’s.”

The federal government will also change its procurement rules to require companies that have contracts with the federal government to buy steel from Canadian producers. 

On Wednesday, the government also laid out efforts to help workers that have faced job cuts since tariffs were imposed. Canada will deploy C$70 million ($51 million) to provide training and income support for as many as 10,000 affected steel workers. It’s also providing C$1 billion to a fund designed to help steel firms advance new projects. 

“We have the potential to become our own best customer for steel, but we will lose that ability if we don’t manage the profound transformation now underway in the industry,” said Carney.

© 2025 Bloomberg L.P.

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