Jul. 17, 2025 - Prime Minister Mark Carney unveiled a sweeping industrial strategy aimed at reinforcing Canada’s steel sector, as the country grapples with U.S. tariffs and surging global steel distortions. The measures are designed to curb harmful trade diversion, strengthen domestic supply chains, and prepare Canadian producers for deep shifts in global steel markets.

Canada is among the most exposed advanced economies to structural shifts in the steel industry, given its large export volumes, open import market, and high per capita consumption. “Our steel industry will be central to Canada’s competitiveness, our security, and our prosperity,” said Carney in announcing the initiative.

The government will impose a series of targeted tariff changes, reducing the steel import quota for non-free trade agreement (non-FTA) countries to 50% of 2024 volumes, with a 50% tariff on imports above that threshold. For FTA partners outside the U.S., the quota will remain at 100% of 2024 levels with the same overage tariff, while existing USMCA rules covering U.S. imports remain unchanged.

Further, by the end of July, a 25% tariff will apply to all steel imports from non-U.S. countries containing steel “melted and poured in China.” These measures, according to government statements, aim to “prevent harmful trade diversion amid current tensions in global steel trade,” particularly in light of U.S. tariffs that have disrupted North American supply chains.

Beyond defensive tariffs, the government pledged C$1 billion through the Strategic Innovation Fund to help Canadian steel producers develop new products and onshore capabilities. Another C$70 million will go toward Labour Market Development Agreements to support and reskill up to 10,000 affected workers in the steel sector.