Rapid Policy Update: United States of America applies Tariffs on Canadian Steel and Aluminum, Canada Retaliates

· by Huzaifa Saeed

As of Midnight, June 1st, 2018, President Donald Trump and the United States Government has applied a 25% Tariff on Canadian Steel and 10% on Canadian Aluminum. This tariff is an implementation of a section 232 investigation that was extensively covered in March 2018, with significant advocacy and negotiation efforts from the Chamber network, industries on both sides of the border and Canadian Government leading to a temporary exemption for Canada, European Union and other United States allies.

Over the past two months, the negotiations on the application of Steel and Aluminum Tariffs on Canada had been incorporated within the NAFTA negotiations, with the Canadian Government most recently fast-tracking enhancements to the Special Import Measures Act and resources for the Canada Border Services Agency on April 26th. This was in response both to ongoing injuries to the Canadian Steel industry due to foreign steel dumping, but also to address concerns by the United States of the”transshipment” of foreign steel through Canada into United States.

These Tariffs are a disappointment to our membership as a legislative decision, as it creates significant disruptions to a highly integrated North American supply chain, damaging relationships between businesses and suppliers while generating substantial uncertainty for the Hamilton economy. Given Canada’s historic role with the United States as a steadfast military ally, our organization also disagrees with the justification and legal premise of the Tariffs under Section 232 regulations.

In the Hamilton region, the steel industry directly employs 10,000 people and, through $2 Billion in local procurement, supports another 30,000 jobs. More than 40% of the 5.8 million tonnes of steel exported to the US – much of it integrated into the US auto, energy, construction and food packaging industries – is made in Hamilton. The steel industry is also preparing to play an active role in the Toronto-Hamilton-Waterloo Advanced Manufacturing Supercluster, which just received significant federal investment.

The Canadian Government launches Counter-Tariffs

In response to the US Tariffs, the Canadian Government has taken a bold and unprecedented step of applying counter tariffs on certain goods exported from the United States as of July 1st, with a 25% Tariff on Steel products and 10% on a strategic list of consumer products, intended to put political and economic pressure on elected officials outside the White House. You can see the full list of items here. Members of public and stakeholders have until June 15th, 2018 to provide feedback in support of or against the specific Canadian Tariffs.

Our Response

We are currently coordinating with our members, governments, the Canadian Steel Producers Association, the Buffalo-Niagara Partnership and the Canadian Chamber of Commerce to gather ongoing information and continue our advocacy efforts on this issue. We’ve also been active in local, national and international media to consistently outline the business case for a Canadian exemption from Tariffs, the ongoing need to invest in remedies and protections against unfair import activity in the Steel and Aluminum Industries and the harmonious integration of our supply chain with the United States.

Selected Media Coverage:

Global News: What U.S. steel, aluminum tariffs mean for Canadians — and their wallets

CP24: U.S. tariffs on steel are ‘bad news’ for Hamilton, mayor says

Toronto Star: In Hamilton, where thousands owe their paycheques to steel, a city braces for Trump’s tariffs

Hamilton Spectator: Hamilton steelmakers brace for ‘chaos’ from U.S. tariffs

CBC Hamilton: US steel tariffs will ‘unleash chaos’: Hamilton Chamber of Commerce

CBC National: Canada retaliates to U.S. tariffs on steel, aluminum (Video)

AM900 CHML (Scott Thompson Show): How big are the concerns of our local chamber in regards to the Steel and Aluminum tariffs and how they’ll impact business in the city?

AM900 CHML (Bill Kelly Show): Hamilton steelmakers, tariffs and LRT

CBC Metro Morning: CEO of Hamilton Chamber of Commerce on steel and aluminum tariffs

For more information please contact: Huzaifa Saeed | Policy & Research Analyst | Hamilton Chamber of Commerce | t: 905-522-1151 ext: 230 | e: h.saeed@hamiltonchamber.ca