US President Donald Trump said the United States will impose a 50pct tariff on Canadian steel, automobiles and automotive parts from January 1, 2027, escalating trade tensions after bilateral negotiations collapsed over the weekend.
Canadian steel already faces a 50pct US levy, which Trump said would be maintained and extended alongside the new tariffs on Canadian cars, trucks and automotive parts.
The announcement followed the breakdown of trade talks between Washington and Ottawa. US Trade Representative Jamieson Greer said Canada had rejected further concessions sought by the US after negotiators had made progress toward a broader agreement.
Reports indicated that Canada opposed a proposed 4 mln ton quota for steel exports to the US, while Washington also sought changes to automotive rules and concessions in other areas of bilateral trade.
Canada is preparing retaliatory measures from September 8, with Prime Minister Mark Carney saying Ottawa will match US tariffs dollar-for-dollar on selected US steel, agricultural and manufactured goods.
The escalation raises risks for North American steel and automotive supply chains, which rely heavily on cross-border trade. US steel producers could benefit from reduced Canadian competition, while Canadian mills face continued pressure to redirect volumes to other markets if access to the US market becomes more restrictive.