Trump Threatens to Double Canadian Steel, Aluminum Tariffs to 50%

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Researched by Industrial Info Resources (Sugar Land, Texas)--U.S. President Donald Trump said Tuesday he would explore doubling 25% tariffs on all steel and aluminum product imports from Canada in direct response to Ontario's 25% surcharge on electricity sent to three U.S. states--although the Canadian province has since agreed to suspend the tax. Regardless, the U.S.' trade war with Canada, Mexico and China rolls along.

Trump in February reinstated a 25% tariff on steel imports from foreign nations and increased the tariff on aluminum from 10% to 25%; both 25% tariffs are set to go into effect March 12.

The president's actions also remove all product exclusions and country exemptions for steel and aluminum, including a carve-out for Canada and Mexico negotiated during the United States-Mexico-Canada Agreement (USMCA).

"Based on Ontario, Canada, placing a 25% Tariff on 'Electricity' coming into the United States, I have instructed my Secretary of Commerce to add an ADDITIONAL 25% Tariff, to 50%, on all STEEL and ALUMINUM COMING INTO THE UNITED STATES FROM CANADA, ONE OF THE HIGHEST TARIFFING NATIONS ANYWHERE IN THE WORLD," Trump posted Tuesday morning on his Truth Social media platform.

However, in a March 11 post on X, CNBC's Megan Cassella reported, "President Trump has NOT yet signed formal paperwork to officially lift tariffs to 50 percent on Canadian steel and aluminum, I'm told -- a senior admin official tells me it is 'in the works.' This remains a threat, rather than an action, until that paperwork is prepared and signed."

In a joint statement from Ontario Premier Doug Ford and U.S. Commerce Secretary Howard Lutnick, the two said they had a "productive conversation about the economic relationship between the United States and Canada." They plan to meet in Washington on Thursday to discuss the renewal of the USMCA ahead of reciprocal tariffs set to go into effect on April 2. "In response, Ontario agreed to suspend its 25% surcharge on exports of electricity to Michigan, New York and Minnesota," Ford and Lutnick said.

Trump also said Tuesday if "egregious, long time Tariffs," by Canada, such as those on a variety of U.S. dairy products, are not dropped, he will on April 2 increase the tariffs on automobile imports--which will "essentially, permanently shut down the automobile manufacturing business in Canada." The president last week delayed tariffs on automobiles covered under the USMCA until that date.

For more information on the back-and-forth trade conflict between Canada and the U.S., see March 11, 2025, article - Canada's New PM Tells U.S. to Show Some Respect and March 7, 2025, article - Trump Pauses Mexico, Canada Tariffs for USMCA-Compliant Goods Until April.

U.S. steel-related stakeholders have applauded Trump's efforts to employ tariffs and boost U.S. production.

On March 10, five steel industry trade groups, including The American Iron and Steel Institute (AISI) and Steel Manufacturers Association (SMA), sent a joint letter to Trump reiterating the industry's support for tariffs under Section 232 of the Trade Expansion Act of 1962, which were initially implemented by the president in 2018, and for "the elimination of the steel Section 232 exclusion process that has been exploited as a loophole by foreign producers seeking to avoid tariffs."

Leon Topalian, the chief executive officer of Nucor Corporation (NYSE:NUE) (Charlotte, North Carolina), the largest steel producer in the U.S., addressed the tariffs in the company's latest earnings call in late January. "Section 232 measures have been critical in providing support for our domestic steel industry, but they've been weakened over time," he said. "Country exemptions and quota arrangements, including with Mexico and Canada and the EU, should be replaced with tariffs, and the Section 232 measures should be extended to downstream steel products such as fabricated structural steel."

The Aluminum Association, however, said tariffs on Canadian aluminum would negatively impact the U.S. aluminum industry. "Canada is the indispensable trading partner," the trade group said in a white paper highlighting the countries' aluminum trading relationship. The U.S. sources about two-thirds of its primary aluminum from Canada, the group said, and exports $2 billion worth of aluminum products to Canada.

The trade group also noted one industry job in Canada equates to 13 aluminum industry jobs domestically.

Public support will strengthen the $10 billion-plus in private U.S. aluminum industry investments since 2013, the association added. "To be successful, these investments need reliable access to aluminum from Canada."

In an interview with CNBC Tuesday morning, Ontario's Doug Ford said the 50% tariff on aluminum would only "hurt the U.S. ... only 16% of the aluminum is produced in U.S. They can't get it anywhere else other than from Quebec in Canada."

In response to Tuesday's developments, incoming Canadian Prime Minister Mark Carney, who is soon expected to be sworn in, through a spokesperson reiterated that the country would keep its tariffs on the U.S. in place "until the Americans show us respect and make credible, reliable commitments to free and fair trade."

White House Spokesperson Karoline Leavitt said Tuesday Trump and Carney had not spoken, although "certainly, his phone is always open."

But Canada is not the only trade war participant retaliating against Trump's tariffs. China's retaliatory measures went into effect Monday, adding a 15% tariff on products like chicken, wheat, corn and cotton, as well as a 10% tariff on products like soybeans, pork, beef, fruits, vegetables and dairy products. Goods that shipped before Monday and arrive in China before April 12 will not be subject to the new tariffs.

Industrial Info Resources (IIR) is the leading provider of industrial market intelligence. Since 1983, IIR has provided comprehensive research, news and analysis on the industrial process, manufacturing and energy related industries. IIR's Global Market Intelligence (GMI) helps companies identify and pursue trends across multiple markets with access to real, qualified and validated plant and project opportunities. Across the world, IIR is tracking over 200,000 current and future projects worth $17.8 Trillion (USD).