Steel, Aluminum Makers Push Trudeau Government on China Tariffs

Steel and aluminum producers in Canada are urging Prime Minister Justin Trudeau’s government to swiftly impose new tariffs on Chinese products, saying metals from the Asian powerhouse are flooding the Canadian market and threatening local jobs.

Catherine Cobden, president and chief executive officer of the Canadian Steel Producers Association, told a news conference in Ottawa on Thursday that the US and Mexico are already working to boost levies on Chinese aluminum and steel.

“China does not play by the rules. Government should be under no illusion that they do. And I think the steel industry is a very poignant example of this,” she said. “We have been feeling the devastating effects of Chinese overcapacity for over a decade.”

Canada wrapped up a 30-day consultation on measures to restrict Chinese electric vehicle imports earlier this month, including a review of higher tariffs meant to align policy with the US and European Union. Finance Minister Chrystia Freeland met with steel and aluminum makers during the talks and appears to be mulling levies beyond just those on EVs. 

Imports of Chinese steel, iron and aluminum products totaled around C$5.6 billion in 2023, according to Bloomberg calculations on Statistics Canada data. While that’s a decrease from the nearly C$7.2 billion imported in 2022, it’s nearly 70% more than the average between 2010 and 2020. 

On a quantity basis, the amount of the metals imported from the Asian powerhouse in 2023 was more than double the average between those years, the data show.

Cobden said the amount of Chinese steel pouring into Canada has grown even though there are already multiple direct tariffs in place — a signal that the current approach isn’t working. “Doing nothing is not an option. Failure to act risks good jobs in steel and aluminum communities right across this country.”

Jean Simard, president and chief executive officer of the Aluminum Association of Canada, said at the news conference that the actions by the US and Mexico leave Canada as the sole tariff-free point of entry for China into North America. 

“In doing so, we expose ourselves to becoming a source of entry for Chinese products that will cause harm to our most important trading partner, the US, throughout our value chain and will eventually harm us.”

Western democracies are increasingly concerned about China’s overproduction of key goods, seeing it as an effort to dominate supply chains and undercut their own industries. Freeland has accused China of having an “intentional, state-directed policy of overcapacity.”

The government is reviewing the results of the consultations and has not said when it will announce a decision. Imposing tariffs will risk reprisal from China, its second-largest trading partner. China previously banned Canadian canola for three years after Canada arrested Huawei executive Meng Wanzhou on a US extradition warrant.

With assistance from Jay Zhao-Murray.

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