The United States has doubled its protectionist stance by increasing tariffs on imported steel and aluminum to 50%, which has alarmed Canadian producers and raised concerns across North American supply chains. The decision, signed by US President Donald Trump and effective June 5, is already being felt sharply in Canada, the largest steel exporter to the U.S.
US Commerce Secretary Howard Lutnick defended the tariff hike during testimony before the Senate Appropriations Committee on Wednesday, June 5.
He gave national security as the primary rationale behind the decision and said, “You can’t fight a war without steel and aluminum production in America,”. “If you don’t have the ability to make your own steel and aluminum, you can’t fight a war, and that is what the president’s doing. He’s trying to make sure that we make sufficient steel and aluminum to protect our defence.”
However, the move has triggered backlash, particularly from Democratic Senator Jeanne Shaheen of New Hampshire, who questioned whether the Pentagon had been consulted and raised concerns about long lead times and reduced access to key materials.
Shaheen cited a ball bearing manufacturer in her state that relies heavily on Canadian and Indo-Pacific steel suppliers, noting that lead times for materials had jumped from 20 weeks to more than two years.
Lutnick downplayed the access issue, calling it a “cost issue,” not a supply crisis. When Shaheen pushed back, highlighting the real-world production delays faced by US companies, Lutnick insisted that tariffs were monetary and not equivalent to sanctions.
Canadian steel and aluminum producers, however, are warning of significant damage. Catherine Cobden, President and CEO of the Canadian Steel Producers Association, said the tariff hike is “creating chaos and disruption throughout North American supply chains and delivering a crushing blow to the Canadian steel industry.”
Cobden noted that even at the previous 25% tariff rate, Canada experienced layoffs, lost investments, and a drop in US shipments. “At a 50 per cent tariff rate, the US market is effectively closed to Canadian steel, and will leave billions of dollars of Canadian steel without a market,” she said.
Trump and his administration have justified the tariff hike by arguing that relying on foreign steel, especially from China, poses a national security risk. White House economic advisor Kevin Hassett warned that countries like China are “dumping” steel to dominate global production and prepare for potential military conflict.
Canada has long been a critical supplier of steel and aluminum to the US, particularly for the defense and aerospace sectors. Canadian materials have supported American military manufacturing from World War II through modern conflicts. To counter the latest tariffs, the Carney administration has pledged to increase domestic defense production using Canadian steel and aluminum to reduce reliance on the US and support local industries.
With these dynamic trade tensions, the ripple effects of Trump’s tariff policy are felt in Canadian and US industries, which depend on steady, affordable access to raw materials. The debate over economic security versus national defense is far from over.
US Commerce Secretary Howard Lutnick defended the tariff hike during testimony before the Senate Appropriations Committee on Wednesday, June 5.
He gave national security as the primary rationale behind the decision and said, “You can’t fight a war without steel and aluminum production in America,”. “If you don’t have the ability to make your own steel and aluminum, you can’t fight a war, and that is what the president’s doing. He’s trying to make sure that we make sufficient steel and aluminum to protect our defence.”
However, the move has triggered backlash, particularly from Democratic Senator Jeanne Shaheen of New Hampshire, who questioned whether the Pentagon had been consulted and raised concerns about long lead times and reduced access to key materials.
Shaheen cited a ball bearing manufacturer in her state that relies heavily on Canadian and Indo-Pacific steel suppliers, noting that lead times for materials had jumped from 20 weeks to more than two years.
Lutnick downplayed the access issue, calling it a “cost issue,” not a supply crisis. When Shaheen pushed back, highlighting the real-world production delays faced by US companies, Lutnick insisted that tariffs were monetary and not equivalent to sanctions.
Canadian steel and aluminum producers, however, are warning of significant damage. Catherine Cobden, President and CEO of the Canadian Steel Producers Association, said the tariff hike is “creating chaos and disruption throughout North American supply chains and delivering a crushing blow to the Canadian steel industry.”
Cobden noted that even at the previous 25% tariff rate, Canada experienced layoffs, lost investments, and a drop in US shipments. “At a 50 per cent tariff rate, the US market is effectively closed to Canadian steel, and will leave billions of dollars of Canadian steel without a market,” she said.
Trump and his administration have justified the tariff hike by arguing that relying on foreign steel, especially from China, poses a national security risk. White House economic advisor Kevin Hassett warned that countries like China are “dumping” steel to dominate global production and prepare for potential military conflict.
Canada has long been a critical supplier of steel and aluminum to the US, particularly for the defense and aerospace sectors. Canadian materials have supported American military manufacturing from World War II through modern conflicts. To counter the latest tariffs, the Carney administration has pledged to increase domestic defense production using Canadian steel and aluminum to reduce reliance on the US and support local industries.
With these dynamic trade tensions, the ripple effects of Trump’s tariff policy are felt in Canadian and US industries, which depend on steady, affordable access to raw materials. The debate over economic security versus national defense is far from over.
