Quebec premier calls new Trump tariff threats on steel and aluminum 'completely unjustified'
Tariff increase from 25 to 50% 'will be catastrophic for our industry,' says steel producers association
Quebec Premier François Legault is calling U.S. President Donald Trump's latest tariff threat on Canadian steel and aluminum producers "completely unjustified."
He made the remark in a post on X, after Trump announced his intention to double the tariffs on steel and aluminum imports to 50 per cent next Wednesday.
"If he goes ahead with this tariff increase, it will harm our economy, as well as the American economy," Legault wrote in French.
Legault added the situation was being closely monitored as they await to see the details of the executive order.
In the meantime, "assistance programs continue to be available to businesses in need," he said.
Both the Canadian Steel Producers Association (CSPA) and United Steel Workers Canada condemned the increase in U.S steel tariffs.
"We're already in a dire situation with the 25 per cent tariffs imposed on us in March, so an additional 25 per cent will be catastrophic for our industry," François Desmarais, the CSPA's vice-president of trade and industry affairs, told CBC in an interview.
Meg Gingrich, assistant to the national director for the United Steel Workers, agreed, saying the move could deliver a "potentially devastating blow" to the industry.
Gingrich and Desmarais pointed to hundreds of layoffs across the country as a result of the current tariffs and Desmarais noted a "massive drop" in steel shipments to the United States.
Desmarais said in April there were 30 per cent less shipments compared to the same time last year.
"You have to keep in mind that over 50 per cent of Canadian steel production is sold in the United States," he said, adding he worries Canadian producers will be shut out of the market if Trump makes good on the proposed increase.
Both organizations are calling on the federal government to take strong action and reinstate counter tariffs immediately, but some are hoping for a more measured response.
Response needs to be targeted
"We understand that we need to have a political answer to the situation," said Julie White, CEO of the Manufacturiers et Exportateurs du Québec — a business association whose mission is to promote the growth of the Quebec manufacturing sector.
She said, however, that any response needs to be targeted and take into account how it will impact different sectors.
White explained that producers of steel and aluminum are in a different situation than the manufacturers who transform those products.
"If it's inputs on the production that are affected by counter tariffs it's going to up the prices of production a lot and there's going to be an impact on businesses in their costs," she said.
"Are they going to be able to keep producing? Are they going to be able to keep all their workers in place?"
White says the uncertainty from the threat of tariffs has hurt manufacturers and exporters in Quebec more than the tariffs themselves, with those taxes leading to lost contracts and investments being delayed.
"At the beginning a lot of people were afraid of the situation, but we've seen that even if Donald Trump has said a lot of things, not all of them happen," she said, adding it's important to take a step back, think longer term and try to find new opportunities.
As an example, White said, the federal government is set to increase its defence spending, so "how are some manufacturers going to shift their production to make sure they respond to those new contracts?"
Counter tariffs not the only solution
Both Desmarais and Gingrich agree that counter tariffs are only part of the solution.
Addressing issues surrounding the sectors' competitiveness and ensuring the integrity of the market in Canada are paramount.
That, according to Gingrich, would require stemming the flow of unfairly traded steel and aluminum into our borders and could perhaps be achieved with a surtax on countries that don't play by the same rules.
She explained how some steel producers affected by American tariffs are looking for new markets to unload their production.
There's a risk of the Canadian market being flooded and undercut by products that are made for cheap abroad through practices such as overproduction, poor labour and environmental standards as well as currency manipulation, Gingrich said.
Desmarais added another solution to boost the sector would be for governments to require domestic products be used for infrastructure projects.
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With files from Shuyee Lee