Carney Vows Tougher Tariffs on Non-U.S. Steel Imports to Protect Canadian Industry

Prime Minister Mark Carney has announced a series of sweeping trade measures aimed at curbing the influx of cheap, foreign steel into Canada, following a sharp 30% decline in domestic production and growing distress in the steel sector.

Speaking in Hamilton on Wednesday, Carney unveiled new quotas and tariffs that will drastically limit steel imports from countries without free trade agreements with Canada—particularly targeting China and Turkey.

“These quota changes will ensure Canadian steel producers have a bigger share of the Canadian market,” Carney said. He confirmed that imports from non-free trade partners will be cut to half of 2024 levels, and any volume beyond that will face a 50% tariff.

Imports from free trade countries—except the U.S. and Mexico—will also be capped at 2024 levels, with a 50% tariff for excess steel.

Additionally, steel products from any non-U.S. country containing steel melted and poured in China will face a 25% additional tariff, as Ottawa seeks to target China’s indirect steel exports.

Carney emphasized the severity of the situation: “Imports currently supply two-thirds of Canada’s steel consumption—compared to one-third in the U.S. and one-sixth in the EU.”

Agreements under the Canada-U.S.-Mexico Agreement (CUSMA) will remain unchanged.

🔩 Industry Reaction

The announcement was met with cautious relief by industry leaders.
Catherine Cobden, CEO of the Canadian Steel Producers Association, welcomed the move, saying, “This puts us in a better position than we were yesterday. The new caps will help Canadian steelmakers recapture the domestic market.”

Still, she warned that the situation remains fragile, with the sector bracing for further losses in the wake of U.S. tariffs. President Trump’s hike to 50% tariffs on Canadian steel and aluminum has already led to layoffs and declining output.

Michael Garcia, CEO of Algoma Steel, also expressed cautious optimism: “This is a step forward. The previous tariff quotas left the window wide open—this closes it a little.”

The real test, he said, will come in the form of the Aug. 1 negotiations with the U.S.

🇺🇸 U.S. Tariffs Still Loom

Carney acknowledged that some U.S. tariffs may remain, despite Canadian efforts to secure full free trade access. He declined to outline Canada’s response if a deal isn’t reached by the August deadline.

Conservative MP Shelby Kramp-Neuman, trade critic, called the quota changes “a step in the right direction,” but said any deal that includes tariffs is unacceptable.

“He ran on not backing down,” she said of Carney. “Now he has to follow through.”

Bloc Québécois Leader Yves-François Blanchet accused Carney of “renouncing and compromising without results,” demanding the Prime Minister admit his failure to deliver full U.S. free trade.

💰 Investment in Canadian Steel

To support the struggling industry, Carney announced $70 million in training and income support for up to 10,000 affected steelworkers, along with $1 billion in innovation funding for steel companies through the Strategic Innovation Fund.

He also pledged to prioritize Canadian steel in future federal contracts for housing, infrastructure, ports, and defense.

“Canadian steel will build millions of homes, bridges, and our security infrastructure,” Carney said. Changes to federal procurement rules are expected soon, requiring contractors to use Canadian-made steel for government-funded projects.