US President Donald Trump announced on Monday He will impose prices On 25% on steel and aluminum against several countries, including Canada, in its last salvo of commercial threats against other nations.
This is not the first time, however, Trump imposed such rates against Canada – in 2018, he imposed 25% on steel and 10% on aluminum. These prices lasted about a year.
Prime Minister Justin Trudeau has not yet commented on the proposed threat.
But as prices come into force, here is what you need to know about Canada commercial relationship of both products with the United States
What amount of steel trade is made with us?
Canada is the first steel exporter to the United States, according to data from the American trade department, with About 566,000 metric tonnes Sent on the other side of the border last month.
According to the Canadian Steel Producers Association, A total of $ 20 billion in commerce Steel between the two countries takes place each year, 40% of imports from Canada.
The US Census Bureau via the American Iron and Steel Institute has shown that a total of 6.6 million net tonnes were imported from Canada to the United States last year, Brazil, sending just over four million and 3.5 million from Mexico.
How much aluminum trade is made with us?
More than 9,500 aluminum workers live in Canada, According to the Canada aluminum associationWorking in an industry, he says generates more than “200 billion dollars in economic production in the American economy alone”.
The United States imports more aluminum than steel with about half of all aluminum from other countries. The majority of aluminum imported in the United States comes from Canada.
Last year, Canada exported 3.2 million tonnes – twice the amount of the following nine countries combined, According to the United States Department of Commerce.
The Aluminum Association in the United States notes that around 90% of American scrap metal aluminum comes from Canada or Mexico, noting that you would need billions of dollars of investment over decades to make the United States “Fully self -sufficient for its metal needs ”.
What industries could be affected?
Almost all industries that use steel or aluminum are affected, according to experts.
“If you think of the household appliances we have at home, many of them use it,” Opher Baron, professor of operations management at the University of Toronto, told Global News.
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“Also in terms of manufacturing and machines, once again, all our machines come from steel. If you want to increase your manufacturing base in the United States … you want to have a good steel to come so that you can the product, you can get your own machines, etc. So these are things that will be injured and prices will increase, “
It is not only manufacturing companies that could be struck either, from car manufacturers to construction and even to the production of drinks
“Steel goes into buildings, it goes into bridges and goes to schools, it goes to a number of products that we produce,” said Philippe Poureaux, partner in value creation at Pwc Canada. “You also think that your soda packaging enters aluminum cans, the same with beer and other products.”
How could it have an impact on communities?
Ontario Prime Minister Doug Ford criticized the prices on Monday, saying that the province “would react hard”.
Ontario is home to six of the country’s 13 steel factories, including ArcelorMittal Dofasco in Hamilton, Ontario, which, for calls, calls a “home” for steel production, Stelco in Hamilton and Nanticoke, Ontario, and Algoma Steel at Sault Ste. Marie, have.
Purchase notes between 70 and 80% of Canada steel are produced in Ontario, although some are also produced in provinces such as Quebec, Alberta and Manitoba.
It’s not just Ontario, but it could be affected. According to Investissement Quebec, Quebec represents almost 90% of aluminum produced in the country.
A price on aluminum, like steel, would have an impact more than the plans that produce products. Communities built around them would also feel problems.
“These are vegetable cities based on the aluminum industry,” said Saibal Ray, president of James McGill in supply chain management at McGill University. “All the other people who depend on the factory, be it restaurants, whether people who drive trucks, everything will be affected.”
He added that if the prices cannot lead to layoffs in the factories themselves, the prices could lead companies to make investments in the United States to avoid prices or scrap expansion plans that could prevent new employment hires.
Why does Trump want prices?
The last time Trump imposed prices on the Canadian steel and aluminum industries, he cited national security as a reason.
This time, Trump’s sales advisor Peter Navarro said that the measures would help producers in the country and will devote American economic and national security.
“The tariffs of steel and aluminum 2.0 will end foreign spills, stimulate domestic production and will secure our steel and aluminum industries as skeleton and pillar of American economic and national security industries” , he told journalists.
“It’s not just a matter of trade. This involves ensuring that America should never count on foreign nations for critical industries such as steel and aluminum. »»
For awakening, there was an uncertainty about the reason why Trump pushes the prices this time, but he thinks that Trump’s “America First” position could be part.
However, he added that it was difficult to say that if it was a short or long -term goal, as this could take several years to open new factories or revive the previously abundant installations in the Trump’s last term space.
Baron said he believed that a big goal behind Trump prices is to change things, to use it as a negotiation tactic.
“One of the problems when you perform a large administration, like the United States, is that the standard ways to do it eternity,” said Baron.
By broadcasting pricing threats early, Trump is able to obtain movements from other countries. The Baron underlined the recent actions taken by Canada and Mexico on their borders shared with the United States which led to the postponement of generalized prices of 25%.
“He has no years, he wants things to move quickly, so I think that is the main motivation for him,” he said.
–with Canadian press files