Prime Minister Mark Carney has unveiled a series of initiatives to support Canada’s steel and lumber industries, which have been negatively impacted by U.S. tariffs. The measures include financial aid and measures to restrict foreign products in the Canadian market.
In an official statement from Carney’s office, the government is targeting steel imports from countries with and without free trade agreements with Canada. For nations without such agreements, Canada is reducing tariff rate quotas for steel products from 50 percent to 20 percent of 2024 levels. This move aims to limit the amount of steel that can be imported at lower duty rates.
During a press conference, Carney mentioned that these actions could result in over $850 million in increased domestic demand for Canadian steel. Additionally, for countries with free trade agreements with Canada, excluding the United States and Mexico, their quotas for steel products are being reduced from 100 percent to 75 percent of 2024 levels.
The government is also terminating the temporary remission of Canadian tariffs on steel imports used in manufacturing, food and beverage packaging, and agricultural production by January 31, 2026. Catherine Cobden, the President and CEO of the Canadian Steel Producers Association, expressed optimism about the new measures, stating that they provide the industry with a competitive edge in the trade dispute with the U.S.
Regarding the lumber sector, which has been struggling under U.S. tariffs, Canada will allocate $500 million through the large enterprise tariff loan facility to assist lumber companies facing financial challenges. An additional $500 million will be provided to the Business Development Bank of Canada’s softwood lumber guarantee program. The government will establish a streamlined process for companies to apply for support programs.
Moreover, the federal government is urging railway companies to slash freight rates for transporting Canadian steel and lumber between provinces by 50 percent starting in the spring. This initiative will involve funding Canadian National Railway and Canadian Pacific Kansas City, with an estimated cost of approximately $146 million for one year.
Derek Nighbor, President, and CEO of the Forest Products Association of Canada, praised the government’s actions and emphasized the importance of efficiently distributing the funds to address the industry’s immediate needs.
The steel and aluminum sectors have been heavily impacted by trade tensions between the U.S. and Canada. President Donald Trump imposed tariffs on Canadian steel and aluminum, escalating them to 50 percent. Recent developments include Trump ceasing trade discussions with Canada due to an Ontario government advertisement that used President Ronald Reagan’s words to convey an anti-tariff message to an American audience. Talks with the U.S. have not yet resumed, as confirmed by Carney in recent statements.