By Ray Rivers
July 18th, 2025
BURLINGTON, ON
“… the new caps [on steel imports] will help Canadian steelmakers “recapture domestic market.” (Catherine Cobden, president and CEO of the Canadian Steel Producers Association)
One day on our farm in Ottawa a neighbour’s prized Charolais cattle broke through our fences and stampeded through our garden – munching and trampling as a heard of cattle will do. Our neighbour was as angry as we were, complaining that he might have lost some of his prized herd. After he had rounded up his herd I recall him telling me – “good fences make better neighbours”.
To Trump, globalization is dead and free trade lies fragmented in the trash can of history.
US president Trump, love him or hate him, is the most powerful leader that country has seen in over half a century. He believes in America first and that America doesn’t need the rest of the world to be successful. He believes in fences, such as his wall with Mexico, his immigration policy, and more recently his economic tariffs on imports.
Thanks in large part to Trump, globalization is dead and free trade lies fragmenting in the trash can of history. Trump’s world view is pure economic nationalism. Low-tariff trade has weakened rather than strengthened the US economy in his view.
His plan is to change all that through protectionist trading rules. And as the world’s largest economy goes, so will much of the rest of the planet. it’ll only be a matter of time before the other nations on this planet follow suit with their own protective economic tariffs.
This week, Canadian PM Carney came into stride with Trump. At a press conference in Hamilton, Carney laid out the beginning of Canada’s new international trade strategy. Quotas on foreign made steel are being introduced and all imports beyond those quotas will face a 50% tariff. In addition, steel originating from China, a nation long known for its unfair trade practices, will be penalized by a further 25%.
Meanwhile restrictions on imports from the US await negotiations between the two countries. But Carney has already signalled that any trade deal is unlikely to be tariff-free. Canada produces around 12 million tonnes of steel annually, exporting a good portion of that mainly to the US. But Canada is also a significant importer of foreign made product – an opportunity for import substitution.
By making foreign steel more expensive, tariffs will encourage Canadian industry to use domestic rather than imported steel products. It is a promising first step in this brave new world before us.
Trump’s 50% steel tariffs are already impacting our steel industry, so it is not too early to act. At stake are the livelihoods of 23,000 workers in the industry and another estimated 100,000 indirect spin off jobs. By making foreign steel more expensive, tariffs will encourage Canadian industry to use domestic rather than imported steel products. It is a promising first step in this brave new world before us.
The second step will be to create new opportunities for steel products. In addition to expanding the acquisition of military hardware the recently enacted Bill C-5 calls for big nation-wide projects, many of which will require steel. Carney’s announcement of new tariffs also sends a signal to Mr Trump that Canada ‘gets it’ – we’re not afraid of the tariff fence Mr. Trump is building and we will protect our economy.
When the first US-Can free trade deal was signed in 1988 Canada had been the 7th largest world economy, with an annual GDP growth rate of 5%. We have since slipped to ninth or tenth place and our manufacturing sector has been hollowed out by the elephant living next door and through the predatory trade practices of emerging Asian nations.
Mr. Trump’s shift in trade policy has come at lightening speed and many Canadians and Canadian companies have yet to wake up to the reality that their world has changed and they too need to change. Trump considers this period in history to be America’s golden age. There is no reason why it shouldn’t be Canada’s as well. And good fences will just make us all better neighbours.
Ray Rivers, a Gazette Contributing Editor, writes regularly applying his more than 25 years as a federal bureaucrat to his thinking. Rivers was once a candidate for provincial office in Burlington. He was the founder of the Burlington citizen committee on sustainability at a time when climate warming was a hotly debated subject. Ray has a post graduate degree in economics that he earned at the University of Ottawa. Tweet @rayzrivers
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I worked as a direct employee for four Canadian steel companies and did contract work for two others. They were all Canadian owned at that time except Gerdau Cambridge.
Fact no basic steel mills are Canadian owned today. All of them compete for capital with other divisions that are outside of Canada. Most if not every steel mill today have narrowed their product range to profitable pruducts to suit the North American integrated market.
While it is noble to say & think these divisions of larger foreign companies will readily update their facilities to supply domestic product it is highly unlikely. Precious capital will be diverted & layoffs will occur unless Carney is successful in significantly reducing or eliminating steel tariffs.
There is a snowballs chance in…..of diverting & selling significant steel tonnage to Europe, China, South Korea etc. for a number and varied reasons.One of them is competitiveness & as Canada is now I believe the only country with a carbon tax on heavy industries let’s start right there.
A country 5500 miles across today has no mill capable of rolling rail sections. Sydney Steel closed decades ago. The few wide flange and I beam sections that Algoma might roll today are insignificant on major projects that I have been active on for 30 years.
These politicians can talk the talk, they certainly can’t walk this walk. While Carney’s announcements have merit they are at least 25 years too late to save what remains of now whatis entirely a foreign owned industry.
Hmmm, looking forward to other readers’ comment. So, for the time being, as many say in the UK, “No comment.” BB in VA
I largely agree with you Ray …but I must point out that “good neighbours” do not go out to deliberately encroach on THEIR neighbour’s property!