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Ottawa Considers New Measures to Protect Domestic Steelmakers From Dumping and Economic Strain
Canada is preparing to introduce stronger trade protection measures in response to rising volumes of foreign steel imports and increasing pressure from U.S. tariff policy. Industry Minister Melanie Joly confirmed on June 11 that the federal government is evaluating new actions to shield domestic producers from unfair dumping practices, especially from low-cost Asian economies.
“We cannot accept any form of unfair practices… that’s enough,” Joly stated, signaling a policy shift toward more aggressive trade defense instruments, possibly including higher tariffs or safeguard mechanisms. Though Joly did not confirm whether China would be directly targeted, the context strongly suggests Beijing’s export flows are under review.
U.S. Tariff Escalation, Chinese Retaliation Shape Canadian Response
The move comes just days after U.S. President Donald Trump raised steel and aluminum tariffs on Chinese imports from 25% to 50%, reigniting global trade tensions. Canada currently applies 25% levies on Chinese steel and aluminum, aligning itself more closely with U.S. policy to defend domestic producers from subsidized or underpriced imports.
In retaliation, China has imposed 100% tariffs on Canadian canola, with additional duties on pork and seafood, and is scrutinizing trade flows of electric vehicles and metals. Despite these frictions, Prime Minister Mark Carney spoke with Chinese Premier Li Qiang last week, signaling a cautious attempt to ease diplomatic strains while keeping trade leverage in reserve.
Domestic Steel Sector Faces Shutdowns and Rising Import Pressure
The urgency of Canada’s response is underscored by recent market activity. On June 11, ArcelorMittal’s long products division announced the closure of a Hamilton, Ontario plant, citing “persistent economic challenges, rising steel imports into Canada, and market conditions.” The shutdown will affect 153 workers.
Other key producers—including Cleveland-Cliffs and Algoma Steel—are watching Ottawa’s next moves closely as they face competitive pressure from low-cost steel producers in Asia and the Middle East. Joly emphasized the government is in active dialogue with steel CEOs and labor unions, suggesting a coordinated response is in the works.
In addition to tariffs, the government may mandate the use of Canadian steel in federal infrastructure projects, a move long requested by domestic industry stakeholders.
ScrapInsight Editorial Commentary
Canada’s steel sector stands at a crossroads, caught between U.S. protectionism and Chinese trade retaliation. To remain competitive, Ottawa must balance diplomacy with decisive action. A steel-focused procurement policy, paired with targeted tariffs, could support jobs and stabilize domestic capacity—without triggering a full-scale trade war.
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