A Rio Tinto-backed aluminum company will commit $1.1 billion toward facility modernization in Quebec as Canada’s aluminum sector navigates escalating trade tensions with the United States.
Aluminerie Alouette announced plans to upgrade its Sept-Îles smelter after securing a new electricity agreement with Hydro-Quebec. The announcement comes as President Donald Trump doubled import duties on Canadian aluminum to 50% in June.
Canada announced protective measures on June 19, warning it may raise counter-tariffs by July 21 if trade negotiations stall. “We will adjust our existing counter-tariffs on steel and aluminum products on July 21, to levels consistent with progress that has been made in the broader trading arrangement with the United States,” Finance Minister François-Philippe Champagne said.
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Read: Canada To Adjust Steel Tariffs Against US On July 21
The dispute threatens a vital trade relationship — Canada provided 56% of all US aluminum imports during 2023, representing 3.08 million tons. Trade disruptions are pushing Canada to redirect exports toward European markets.
Quebec produces 70% of North American aluminum, according to Quebec Economy Minister Christine Frechette. Alouette runs Canada’s largest smelter, producing approximately 623,000 metric tons annually. The operation employs 900 people and features joint ownership by Rio Tinto (40%), AMAG Austria Metal AG, and Norway’s Hydro Aluminium.
Canada’s aluminum sector supports 29,500 jobs across nine facilities and generated over $12 billion in exports before the trade dispute. The industry was valued at $9.59 billion in 2023.
Ottawa has established a $10 billion loan facility for affected businesses and is implementing procurement policies favoring Canadian suppliers. Trade negotiations between Prime Minister Mark Carney and Trump broke down in late June, with Trump ending discussions over Canada’s digital services tax.
Canada subsequently scrapped the tax to avoid higher tariffs, but the July 21 deadline for potential Canadian counter-tariff adjustments remains.
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