Canada Strengthens Steel Regulations and Boosts Support for Lumber Industry

Citing data from industry insiders, Canada is set to implement stricter regulations on steel imports while enhancing financial support for lumber producers in response to challenges posed by U.S. tariffs.

The administration led by Prime Minister Mark Carney intends to decrease the tariff-rate quota for steel imports from non-trade-deal nations down from 50% to just 20%. This adjustment means that any excess volume beyond this threshold will incur tariffs based on last year’s sales figures in Canada.

Additionally, the government aims to bolster a loan program for softwood lumber businesses with an infusion of C$500 million (approximately $355 million), as revealed by sources who requested anonymity due to the sensitive nature of the discussions.

This policy shift builds upon measures introduced earlier this year that imposed tariffs when import volumes exceeded half of their levels recorded in 2024. Such actions have drawn criticism from China, which expressed concerns over potential impacts on economic relations between the two nations.

The Canadian steel sector has faced significant challenges due to hefty tariffs imposed by the previous U.S. administration on various imported metals. In response, both federal and provincial governments extended emergency loans aimed at supporting companies like Algoma Steel Group Inc., which has been particularly vulnerable under these conditions.

The primary trade association representing Canada’s steel industry has advocated for stronger protective measures against foreign competitors who might seek refuge in Canadian markets following restrictions placed by the U.S.

In retaliation against initial U.S. tariffs of 25%, Canada enacted similar duties; however, when those rates escalated under former President Trump’s policies, Carney opted not to increase Canada’s rates correspondingly.