Prime Minister Mark Carney of Canada announced steps on Wednesday to block steel from China and other countries now subject to U.S. tariffs from overwhelming the Canadian market.
“The trade actions of the United States are further transforming global steel market dynamics and supply chains,” Mr. Carney told reporters. “Canada will be one of the countries most impacted by these developments.”
President Trump’s imposition of a 50 percent tariff on steel has set off turmoil in markets around the world, including in Canada, where steel is an important industry.
Mr. Carney’s government says that because of the U.S. tariffs, China was looking to export more steel to Canada. Many countries, including Canada, argue that Chinese exports like steel are sold at prices well below what it cost to produce them.
Last month, Mr. Carney said countries that do not have a free-trade agreement with Canada, including China, would be subject to 50 percent tariffs if their steel shipments to Canada exceeded 2024 levels.
But Canadian steel officials complained that this would not be enough to protect the domestic industry from what they feared would be a surge of foreign steel.
So on Wednesday, Mr. Carney ratcheted up the pressure, announcing that countries without free-trade agreements would now face 50 percent levies if their steel exports exceeded more than half of what they sent in 2024.
Steel producers in countries that do have free-trade deals with Canada would be capped at last year’s shipment levels. Anything beyond that would face a 50 percent tariff. (Canada has already placed a 50 percent tariff on steel from the United States).
“This is a big step forward,” said Catherine Cobden, the president of the Canadian Steel Producers Association.
Mr. Carney’s announcement, made at a steel plant in Hamilton, Ontario, a city west of Toronto home to Canada’s two largest steel mills, came a day after he acknowledged that he likely cannot meet his objective of eliminating Mr. Trump’s tariffs through negotiations.
Mr. Carney declined to say what, if any, levels of U.S. tariffs Canada would now accept. “It would be a bad response in the middle of a negotiation,” he said.
Mr. Trump has also placed a 50 percent duty on aluminum. Canada is the largest exporter of steel and aluminum to the United States.
Last week Mr. Trump escalated his trade battle with Canada, warning that he planned to impose 35 percent tariffs on other Canadian imports on Aug. 1.
He noted that Canada had retaliated against the United States by imposing its own levies and repeated claims that Canada had not done enough to stem the flow of fentanyl across the border, an assertion not supported by data.
It’s not clear if the new American tariffs would exclude products that qualify under the current free trade agreement between Canada, the United States and Mexico.
Mr. Trump has also vowed to put tariffs on copper and suggested that he would target Canada’s closed market for dairy products, as well as the country’s exports of pharmaceuticals and lumber.
The U.S. tariffs have effectively blown apart the trilateral free trade agreement Mr. Trump signed during his first term.
In addition to his trade measures, Mr. Trump has provoked anger and resentment among many Canadians by repeatedly calling for Canada’s annexation as the 51st state and insisting that it is not economically viable as a nation.
When Mr. Trump began introducing protectionist measures, some analysts wondered if Canada might abandon Mexico and attempt to make a two-country deal with the United States. Mexico has long been a competitor with Canada for jobs and investment, particularly in the automotive sector.
But as relations further weaken with the United States, Canada’s s relations with Mexico appear to be growing closer.
President Claudia Sheinbaum of Mexico said at a news conference in Mexico City on Wednesday that she and Mr. Carney had “discussed strengthening relations with Canada in different areas, mainly trade” during the Group of 7 summit of leading industrial nations last month in Canada.
She said that the two leaders had a telephone call this week and that Mr. Carney would come to Mexico for meetings.
Emily Williams, a spokeswoman for Mr. Carney, said no date has been set for the meeting, but that it would occur “in the coming months.”
Ian Austen reports on Canada for The Times based in Ottawa. He covers politics, culture and the people of Canada and has reported on the country for two decades. He can be reached at [email protected].
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