Prime Minister Mark Carney is set to announce significant new support measures for Canada's steel sector as it continues to grapple with punishing 50 per cent tariffs on exports to the United States.
New Import Restrictions and Shipping Relief
The federal government will implement two key initiatives to assist struggling steel producers. First, Canada will further restrict the volume of steel that countries without free trade agreements can import duty-free, lowering the limit to just 20 per cent of their 2024 shipment volumes. Second, new policies will aim to reduce the costs of shipping steel by rail within Canada, addressing long-standing concerns from Western provinces.
These announcements, scheduled for Wednesday afternoon according to a source not authorized to speak publicly, come as domestic steel manufacturers face increasing difficulty finding markets for their products with U.S. access severely constrained.
Broader Trade War Impacts
The support extends beyond steel, with Carney also planning measures to aid other sectors caught in the ongoing trade conflict, including softwood lumber producers. The situation has reached critical levels for companies like Algoma Steel Inc., which received a $400-million federal loan and $100 million from Ontario this summer. The company derived more than half its revenue from U.S. sales last year but expects those sales to drop to zero by year-end if tariffs remain.
The Canadian Steel Producers Association had lobbied for even stricter import limits, requesting the government cap all foreign steel at 25 per cent of 2024 volumes, regardless of free-trade status. The government's approach has evolved through 2025, starting in June with limits matching 2024 volumes for non-free-trade countries, then reducing to 50 per cent in July with a 50 per cent tariff on excess volumes.
Regional Shipping Challenges Addressed
British Columbia and other Western provinces have repeatedly highlighted the prohibitive costs of shipping steel from Central and Eastern Canada, where most industry is concentrated in Ontario and Quebec. Trade groups and provincial ministers have urged the federal government to consider these rail costs when designing import restrictions, making the new shipping cost reduction policies particularly significant for national market integration.
The latest measures represent the government's continuing effort to balance protection for domestic industry against the realities of interprovincial trade barriers and global market pressures.
