Ottawa preparing new measures to shore up Canada’s steel sector facing U.S. tariff pressures

Prime Minister Mark Carney is expected to introduce a package of federal supports aimed at stabilizing Canada’s steel industry as companies continue to absorb the economic impact of steep U.S. tariffs. A federal official, speaking to The Canadian Press, said the measures are designed to protect domestic producers while keeping national supply chains functioning.

According to the official, the federal government plans to restrict steel imports from countries without free-trade agreements with Canada. Those import levels would be reduced from 50 per cent to 20 per cent of what entered the country in 2024. The move is intended to ease pressure on Canadian mills that have reported declining orders and rising costs since the U.S. imposed higher duties earlier this year.

Ottawa is also preparing to work with CN Rail to lower freight costs for steel shipments moving between provinces. The plan would cut rates by half, with the government committing to cover the difference if CN cannot absorb the reduced fares. Lower shipping costs are expected to help steel producers maintain distribution networks, particularly in Western Canada where transportation distances are significant.

The new supports follow the United States' decision in June to raise tariffs on Canadian steel to 50 per cent. Industry groups have warned that the levy has slowed production, reduced export volumes and led to uncertainty for workers and communities that rely on steel manufacturing. The upcoming announcement is expected to be closely watched in regions such as Alberta and British Columbia, where construction and fabrication sectors depend on steady steel supply.