U.S. President Donald Trump arrives on the South Lawn of the White House in Washington, D.C., U.S., ON March 9, 2025.
| Photo Credit: Reuters
U.S. President Donald Trump announced massive new tariffs on Canadian steel and aluminium Tuesday (March 11, 2025), while threatening to “shut down” its auto industry and saying the best way to end the trade war was for Washington’s ally to be absorbed into the United States.
Mr. Trump’s shock new threats came hours before a midnight deadline for ramping up the Republican’s increasingly global trade offensive.
On his Truth Social platform, Mr. Trump announced that he would increase tariffs on Canadian steel and aluminium imports by an additional 25% for a total of 50% duties on those commodities for the neighbour.
This is in addition to tariffs of 25 percent on steel and aluminium imports from around the world, including exporters in Brazil, Mexico and United Arab Emirates.
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The upcoming levies, which currently allow for no exceptions, threaten to hit everything from electronics to vehicles and construction equipment — and have manufacturers scrambling to find cost-effective domestic suppliers.
The country facing the most aggressive action is Canada, historically one of the United States’ closest allies and top trading partners, but now locked in an extraordinarily bitter war of words with the Republican, as well as constant threats over its sovereignty.
Canada’s incoming prime minister Mark Carney struck a defiant note Sunday (March 9. 2025), vowing to stand up for “the Canadian way of life” and saying Canadians are “always ready” for a fight if needed.
Canada supplies half of U.S. aluminium imports and 20% of U.S. steel imports, noted industry consultant EY-Parthenon.
Also Read | Canada’s Ontario Province slaps 25% tax increase on electricity exports to U.S.
Mr. Trump said his new supercharged tariffs were in response to Canadian province Ontario’s imposition of a 25% tax on electricity exports to the United States. Mr. Trump said he would also be announcing an electricity national emergency in the area hit by the price increases.
But he also ramped up his threats, warning that if what he called “egregious” Canadian tariffs are not dropped he will also impose car import tariffs starting April 2 “which will, essentially, permanently shut down the automobile manufacturing business in Canada.”
In the same lengthy social media post, Mr. Trump said the “only thing which makes sense” is for Canada to join the United States as a 51st state.
“This would make all Tariffs, and everything else, totally disappear. Canadians taxes will be very substantially reduced, they will be more secure, militarily and otherwise, than ever before, there would no longer be a Northern Border problem,” Mr. Trump said.
Also Read | Trudeau not willing to lift retaliatory tariffs if Trump leaves any tariffs on Canada
Costs and opportunities
If some companies are bracing for a damaging period of elevated production costs, others are sensing an opportunity.
Drew Greenblatt, owner of metal product manufacturer Marlin Steel, said the incoming levies on imported steel have already boosted his new orders.
“We only use American steel, so we’re thrilled with the tariffs,” he told AFP, adding that these helped him gain an edge over a competitor that was using Chinese metal imports.
But producers who use foreign sources of steel have warned that higher import costs will ripple through the world’s biggest economy.
Also Read | Trudeau calls Trump’s tariffs ‘very dumb’, says U.S. appeasing Putin while launching trade war against Canada
Even as some domestic companies stand to benefit as tariffs bring them more business, a major U.S. maker of steel products warned that American steel prices would surge to match the elevated costs of foreign goods.
Supply constraints nudge prices higher, making items like nails for example more pricey given that much of their cost comes from original steel.
Purchasers in industries like homebuilding would therefore end up spending more money.
They could end up passing these costs on to consumers, making homes even less affordable, the manufacturer cautioned, speaking on condition of anonymity.
Published – March 11, 2025 09:16 pm IST