Canada’s steel sector has been facing intense challenges in recent months, largely due to aggressive U.S. tariffs that have disrupted exports and raised production costs. In response, the federal government is preparing a series of relief measures aimed at stabilizing the industry and supporting thousands of workers who depend on it. Prime Minister Mark Carney is set to unveil these new initiatives as part of a broader strategy to protect and transform key Canadian industries.
As tension rises in North American trade relations, these upcoming policies are positioned as a crucial lifeline to safeguard Canada’s manufacturing capabilities, reduce reliance on unpredictable foreign markets, and make space for domestic producers to grow again.
1. Overview of the New Steel Industry Supports
Prime Minister Mark Carney is expected to announce new federal actions aimed at strengthening the steel sector, which has been heavily hit by American tariff policies. These steps include import restrictions, transportation cost reductions, and expanded market protections.
2. Why the Measures Are Needed
The steel industry is a backbone of Canada’s manufacturing economy. Continued U.S. tariffs have depressed export volumes and resulted in significant financial strain. Without corrective action, producers risk losing both competitiveness and market share at home and abroad.
3. How U.S. Tariffs Have Impacted Canadian Steel
In June, U.S. President Donald Trump imposed a 50% tariff on Canadian steel, sending shockwaves through the industry. Demand dropped, profits shrank, and mills faced mounting pressure to cut costs.
This environment has forced Canada to rethink its supply chain priorities and take a more protective stance.
4. Major Import Reductions and Market Protections
Cuts to Non–FTA Imports
Ottawa plans to sharply limit steel imports from countries without a free trade agreement.
The new cap will reduce imports from 50% of 2024 levels to just 20%, making more room for Canadian-made steel.
Changes to FTA Partner Imports
Imports from FTA partners — except the U.S. — are also expected to see reductions, though the final percentage has not yet been confirmed. Previously, the government applied a 50% tariff on steel from these countries when imports exceeded 2024 levels.
5. Expected Boost for Canada’s Domestic Steel Industry
By trimming foreign supply, the government estimates an additional $854 million in domestic market demand could open up.
This will offer Canadian steel producers a vital opportunity to fill the gap and rebuild stability in the sector.
6. Freight Rate Reductions Through CN Rail
To further support producers, the federal government is working with CN Rail to cut interprovincial freight rates by 50% for steel shipments.
If CN Rail cannot offer a lower rate, Ottawa will subsidize the difference — ensuring transportation costs don’t eat into industry profits.
7. Impacts on Northern Supply Chains
It remains uncertain whether the same freight reductions will apply to steel destined for northern regions such as the Yukon, Northwest Territories, and Nunavut — areas where shipping is already expensive due to sealift and winter road logistics.
8. Political Context Behind the Announcement
These measures come at a time of heightened political friction.
Trade talks between Canada and the U.S. broke down after Ontario aired American TV ads featuring Ronald Reagan’s remarks on tariffs, which frustrated Washington.
Carney — criticized for saying “Who cares?” when asked about his last call with Trump — promised a response this week for workers in the steel, auto, and lumber sectors.
9. Additional Supports for Softwood Lumber
Along with steel-related policies, Carney is also expected to announce new financial and structural supports for Canada’s softwood lumber industry.
10. Conclusion
Canada’s steel sector is at a critical point, pressured by foreign competition and aggressive U.S. tariffs. The upcoming measures from Prime Minister Carney signal a strong commitment to defending national industries, supporting workers, and reinforcing Canada’s economic independence. These steps are expected to provide both immediate relief and long-term transformation for one of the country’s most strategic sectors.