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| Canadian scrap |
Tariff Threat Risks Disrupting Scrap Supplies
The US tariff threat on Canadian imports in 2026 could disrupt ferrous and aluminum scrap flows. Canada supplies over half of US aluminum scrap imports. Meanwhile, uncertainty surrounds USMCA exemptions, leaving US steel and aluminum makers cautious. As a result, domestic feedstock sourcing may face immediate strain if tariffs are enforced. Producers and traders must monitor policy developments closely to adjust supply chains proactively.
Canadian Scrap Dominates North American Imports
Canada shipped 396,000 tonnes of aluminum scrap to the US between January and October 2025, representing nearly 55% of total imports. Additionally, it supplied 63% of US ferrous scrap, totaling 1.39 million tonnes. In contrast, Mexico provided 223,000 tonnes of aluminum scrap and 444,000 tonnes of ferrous scrap in the same period. Therefore, any trade disruption would significantly affect North American scrap availability and pricing.
Market Uncertainty and Strategic Considerations
The White House has not issued an executive order or clarified which Canada-China deal triggered the threat. Consequently, scrap exporters and US buyers face prolonged uncertainty. Traders may stockpile materials, impacting short-term pricing and logistics. Meanwhile, US producers may explore alternative sources, including domestic recycling or Latin American imports, to mitigate potential shortages.
ScrapInsight Commentary
The potential US-Canada scrap tariff could tighten North American feedstock supply, supporting near-term scrap price stability. Market participants should watch USMCA exemptions and alternative sourcing strategies. Strategic planning will be crucial to avoid operational disruptions if tariffs materialize.
