Canada's Steel Sector Faces Tougher Measures Amid Foreign Dumping Concerns

Canada is examining tougher measures to counter foreign steel dumping amid US tariffs battering the Canadian sector. Industry Minister Melanie Joly says Canada can do more to restrict imports and has put 25% tariffs on Chinese steel. The government is also pushing for relief from steel tariffs in trade talks with the US. Canada's steel industry has significantly reduced shipments to the US and shed jobs, with some producers forced to apply for federal loans.

Canada is intensifying its efforts to counter foreign steel dumping, particularly from China, amidst the ongoing impacts of U.S. tariffs on the domestic steel sector. Industry Minister Melanie Joly has emphasized the need for more restrictive measures to protect Canadian steel producers, who have been significantly affected by the trade tensions.

The Canadian government has already implemented a 25% tariff on Chinese steel and has tightened its tariff-rate quotas to further restrict imports from countries without free-trade agreements. The latest move involves a 25% surtax on steel products from any country, except for the U.S., that contain steel melted and poured in China. This new rule took effect on August 1, 2025 [1].

Minister Joly acknowledged that these measures are a step in the right direction but stressed that more needs to be done. She plans to engage in further discussions with government officials and industry leaders upon her return to Ottawa. The government's policy response will be informed by data on the trade war's impacts and the business decisions of steel plants. Canada is also pushing for relief from steel tariffs in ongoing trade talks with the U.S. [2].

The Canadian steel industry has experienced a significant reduction in shipments to the U.S., leading to job losses and financial strain for many producers. For instance, Algoma Steel Group Inc. reported a large second-quarter loss and has applied for federal loans. The company's share price has tumbled about 50% this year. Prime Minister Mark Carney has indicated that retaliatory tariffs on a long list of U.S. goods will be dropped, but 25% import taxes on US steel will remain in place [2].

The Canadian Steel Producers Association (CSPA) has called for increased government action to protect the domestic steel industry. This includes strengthening tariff-rate quotas and enforcing stricter controls on indirect steel trade. The association has also advocated for Canada to impose a 50% tariff on all US steel entering the country, including the immediate end of a temporary reprieve on US steel used in manufacturing and processing [3].

The industry faces a challenging landscape, with global steel oversupply exacerbated by U.S. tariffs and similar measures elsewhere. This has prompted aggressive export strategies from manufacturers, including China. Recently, Japan's steel lobby has also called for stronger anti-dumping enforcement, while countries like South Korea and Vietnam have imposed levies on Chinese steel [1].

The Canadian government is focused on helping steel companies pivot to other industries, such as defense, and will provide financing assistance. Melanie Joly emphasized that a strong industrial base is crucial for national security and economic resilience.

References
[1] https://oilprice.com/Metals/Commodities/China-Challenges-Canadas-Steel-Tariffs-at-WTO.html
[2] https://www.steelmarketupdate.com/2025/08/21/canadian-steel-producers-call-for-protection-after-us-adds-derivatives-to-s232/
[3] https://www.bloomberg.com/news/articles/2025-08-28/canada-examines-tougher-measures-on-foreign-steel-dumping-minister-says