To Canada’s dismay, on Thursday, US President Donald Trump announced that the US will be reimposing trade penalties on Canadian aluminum that were only lifted last year. According to Trump, Canadian steel producers had flooded the US with aluminum exports that have been allegedly destroying the country’s industry and job market.
The reignited trade feud comes just several weeks after the US, Mexico, and Canada finally put a new trade pact in place that was previously signed two years ago alongside the G20 Summit. Although the goal of the pact was to mitigate trade disputes between the three countries, there are evidently disagreements that still remain – such as Trump’s latest tariff announcements.
In response to the renewed call for 10% tariffs on Canada’s aluminum exports, Deputy Prime Minister Chrystia Freeland reacted with apprehension, arguing that such tariffs would only fuel the already complicated problems posed by the current COVID-19 pandemic for industrial workers and local economies. Freeland condemned the unwarranted tariffs, and vowed Canada will retaliate with dollar-for-dollar measures.
Canada has a highly advanced and skilled aluminum production industry, which puts it at the lowest carbon footprint compared to other steel producers of the same size. The country is also the world’s fourth largest manufacturer of aluminum, and produced a total of 2.8 million metric tonnes in 2019.
Information for this briefing was found via Government of Canada. The author has no securities or affiliations related to this organization. Not a recommendation to buy or sell. Always do additional research and consult a professional before purchasing a security. The author holds no licenses.