Just one week after an announcement that tariffs on Canadian imports into the U.S. were put on pause for at least 30 days, U.S. President Donald Trump announced new 25 per cent tariffs on all steel and aluminum imports, including from Canada and Mexico.
“We were being pummeled by both friend and foe alike,” said Trump. “It’s time for our great industries to come back to America.”
Trump announced his intention to bring in the tariffs while aboard Air Force One on his way to Super Bowl LIX Sunday.
According to the Canadian Steel Producers Association, there is $20 billion in trade of steel between our two countries and 40 per cent of Canada’s steel imports comes from the United States.
The unpredictable nature of the 47th U.S. President has forced many businesses in eastern Ontario to be flexible, coming up with contingency plans for whatever may come next.
“In 70 years, the company has gone through some rollercoaster issues like this, but I must say, this one is the most severe,” said Judah Silverman, Chief Administrative Officer and co-owner of Ottawa-based Ambico.
“Our biggest priority is on our staff and how is affects them on a daily basis. We keep telling them their jobs are secure.”
Ambico has been operating in Ottawa since 1955, manufacturing doors, frames, and windows. Some of their biggest clients are south of the border.
During his first term, Trump imposed a 25 per cent tariff on steel and 10 per cent tariff on aluminum, but he later backed off, granting several trading partners duty-free exemptions, including Canada, Mexico and Brazil.
Silverman says they were forced to navigate that experience, and they are now planning for the potential outcomes this time around.
“We are reaching out to our customers, especially those in the U.S., and comforting them. We’re telling them that we have their back to whatever extent that we can,” said Silverman.
“It’s likely the price of steel will rise. When there were tariffs on steel in 2018, that’s essentially what happened. Steel prices rose a little bit, but we were able to handle that and cover that, and we hope to do so again.”
Dennis Darby, President, and CEO of Canadian Manufacturers & Exporters says the latest move by Trump to impose tariffs on steel and aluminum will likely result in inflation.
“Steel and aluminum are the most ubiquitous materials and Canada, of course, is a great supplier and a very needed supplier so, it’s very disheartening at this point and we’ll probably have to retaliate like we did in 2018,” he said.
“It’s not like tomorrow, the U.S. could find another source. In fact, we are their number one source for these two materials. So, the problem is, it will be inflationary. It will add costs to supply chains and so, it either hurts companies, hurts employees, and certainly the consumer will pay.”
Everything from vehicles and aerospace parts to pipes for the oil and gas sector and cans are expected to increase in price.
Darby argues these latest tariffs are unjustified and misguided, and the U.S. should be working with Canada to reduce imports from China.
“Voices in the U.S. are the ones that are going to have to convince Mr. Trump that this is not to anyone’s benefit,” he said.
“Canada and the U.S. worked together a few months ago, before Mr. Trump was elected, to put tariffs on China, who actually is guilty of dumping steel and aluminum into North America… It’s ironic that now, a few months later, we’re at the pointy end of the stick.”
