Tariff Turbulence: Canadian Metals Face Harsh U.S. Duties Despite Trade Uptick

 

Canadian Aluminum and Steel Exports Hit Hard by U.S. Tariffs in June

Canada’s aluminum and steel sectors bore the brunt of escalating U.S. trade duties in June 2025, even as overall exports to the United States saw a modest rise. According to Statistics Canada, exports of unwrought aluminum and iron and steel products dropped more than 11% in June, coinciding with the U.S. doubling its global tariffs on these metals to 50%.

Despite this setback, Canadian exports to the U.S. rose 3.1% month-over-month, driven largely by energy shipments and strategic frontloading by exporters ahead of anticipated tariff hikes. However, total exports were still down 12.5% compared to June 2024, highlighting the lingering impact of trade uncertainty.

The U.S. tariff escalation—part of President Trump’s broader protectionist strategy—also included a 35% duty on non-CUSMA compliant Canadian goods and a 40% penalty for transshipped items. While 90% of Canadian exports still qualified for duty-free access under CUSMA, the remaining share faced steep cost increases.

In response, Canada unveiled a six-point countermeasure plan, including reciprocal procurement rules, tightened origin requirements, and a $10 billion loan facility to support affected manufacturers. These moves aim to stabilize domestic industries and preserve supply chain integrity amid rising trade tensions.

Economists caution that while June’s uptick in trade may signal resilience, the broader picture remains fragile. “Canadian trade still hasn’t found a new footing,” said CIBC’s Andrew Grantham, noting that the second quarter saw a 12.8% drop in total exports following a record-setting Q1.

As negotiations continue between Ottawa and Washington, the fate of Canada’s metals sector hangs in the balance—caught between economic diplomacy and tariff warfare.