Canada may increase tariffs on U.S. steel and aluminum imports if the two countries fail to reach a trade agreement over the Trump administration’s trade policies within the next month. The new tariffs are scheduled to take effect on July 21, shortly after President Donald Trump’s 90-day pause on reciprocal tariffs expires.
Canada said it will adjust its existing counter-tariffs to “levels consistent with progress that has been made in the broader trading arrangement with the United States.” Additionally, beginning June 30, the Canadian government will limit federal procurement of steel and aluminum products to domestic suppliers.
As part of broader efforts to protect its steel sector, Canada will establish 100% tariff quotas for steel imports from countries with which it doesn’t have a free trade agreement. These quotas will be based on 2024 import levels.
In a press release issued on June 19, the Canadian government stated it’s preparing to take additional steps “to address risks associated with persistent global overcapacity and unfair trade in the steel and aluminum sectors, which are exacerbated by U.S. actions.” Finance Minister François-Phillippe Champagne said Canada is taking “strong, targeted action” to defend its domestic industries while negotiations continue.
The situation follows escalating trade pressure from the United States. In March, the U.S. enforced a 25% tariff on imported steel and aluminum. That rate was doubled to 50% on June 4. The increase is part of a broader push by the Trump administration, which also enacted a baseline 10% global reciprocal tariff that remains in effect during the current negotiation window.
The 90-day pause was designed to give the U.S. time to negotiate deals with key trading partners. While talks have been ongoing between the U.S. and Canada, no formal agreements have been finalized. However, during the G7 Summit in Alberta last week, Canadian Prime Minister Mark Carney and President Trump collectively agreed to solidify a deal within 30 days.
