Industry Minister Melanie Joly says government intervention will be necessary for the Canadian steel industry’s survival, as U.S. tariffs continue to threaten it.
“Survival, and I think eventually, much more than that, the fact that they can thrive,” Joly said in an interview on the Vassy Kapelos Show across the iHeart Radio network on Thursday.
In March, the U.S. placed a 25 per cent tariff on Canadian steel and aluminum, doubling the tariff rate to 50 per cent in June.
Joly pointed to efforts to get Canadian shipyards to use domestic steel and for the government to leverage its procurement purchasing power to support the industry as examples of other potential measures the federal government is willing to pursue, beyond what has already been announced.
On Wednesday, the prime minister announced additional tariffs that target steel originating in China in an effort to protect the Canadian market.
In February, Canada laid out a series of counter-tariffs in response to the U.S. measures at the time, but has yet to respond to the doubling of steel and aluminum levies specifically.
Joly said she hopes Wednesday’s announcement will “calm down the anxiety in the steel sector,” while helping to protect jobs in the industry.
In a statement Wednesday, the United Steelworkers union called the announcement, specifically the changes to tariff rate quotas, a “major win for workers.”
But many industry stakeholders and experts are still concerned.
In an interview on The Vassy Kapelos Show on Wednesday, François Desmarais of the Canadian Steel Producers Association said diversifying the market, including domestically, is likely not enough to make up for the drop in exports to the U.S., because the latter is such a significant importer of Canadian steel, and the global market is oversaturated.
According to Desmarais, shipments to the U.S. fell by about 25 per cent and there were about 1,000 job losses in March, after U.S. President Donald Trump announced his initial round of 25 per cent tariffs on steel and aluminum. Once Trump increased the rate to 50 per cent last month, “basically all our export to the U.S. have stopped,” Desmarais said.
Joly said the steel industry should be seen not just as key to the manufacturing sector, but also to defence, as Canada has promised to meet its NATO defence spending target sooner than the previous government hoped to.
“Definitely, the steel industry is impacted by the tariffs that are imposed by the White House,” Joly told Kapelos, when asked whether the sector is at risk of collapse.
“They needed to pivot,” she also said. “They needed it to make sure, first, that we protect the Canadian market from any form of dumping from foreign steel, and at the same time, we need to support them as we’re creating much more a domestic market for them, maybe through defence procurement or maybe also through our major infrastructure projects to make sure that they build, or they develop the type of steel that our industries need here.”
Canada and the U.S., meanwhile, have been in ongoing negotiations for a new economic and security deal.
Last month, Carney said he and Trump were working toward a deal by July 21. But the U.S. president last week issued a new threat to impose 35 per cent tariffs on Canadian imports as of Aug. 1.
A White House official has confirmed to CTV News that the increased 35 per cent tariff will not apply to Canadian goods that comply with the Canada-U.S.-Mexico Agreement (CUSMA). Carney has since revised the deadline to reach an agreement by Aug. 1.
Pressed on whether the Canadian government will accept a deal with Trump that includes some baseline levies — after Carney shifted his tone earlier this week and cast doubt on securing a tariff-free deal with the president — Joly called the U.S. a “difficult administration,” and repeated that Canada will not negotiate in public.
“At this time in the negotiations, we’ll let the prime minister do his work, and we will make sure also, of course, that we don’t negotiate in public,” Joly said, when asked about the federal government’s concessions to the U.S. after campaigning on the promise of a strong response to Trump.
“And these are complex negotiations for every country on Earth,” Joly added. “So, it is important that we stand strong. It is important that we defend Canada and Canadians interest, and we will make sure to be there, and we have Canadians’ back.”
