Canadian steel group sees U.S. tariffs persisting as Stelco layoffs deepen sector pressure
Canadian steel producers are planning for enduring U.S. tariff barriers as planned Stelco layoffs underscore the sector’s reliance on export access.
Canada’s steel industry is being urged to plan around a prolonged period of U.S. tariff barriers rather than a near-term return to normal market access. Appearing before the Senate foreign affairs committee on Oct. 8, John Cuddihy, a vice-president of the Canadian Steel Producers Association, said the association expects tariffs to remain part of the commercial landscape for the long term and called on Ottawa to reinforce Buy Canadian procurement rules. [1]
Cuddihy’s assessment was based on his view that the U.S. financial and policy environment could make broad tariff removal difficult. He also told the committee that U.S. steel producers had benefited substantially from the trade conflict. The comments are an industry outlook, not an announcement of a new U.S. tariff measure or a change in the applicable duties. [1]
The report linked that uncertainty to mounting pressure at Hamilton’s Stelco plant. Cleveland-Cliffs plans to lay off roughly 350 workers there, although Cuddihy declined to comment on the effect of that decision. Prime Minister Mark Carney accused the U.S. owner of betraying Canadian workers and said federal funding was available to help keep employees working at the facility. [1]
Cleveland-Cliffs chief executive Lourenco Goncalves said government money would not have changed the factors behind the decision. He said Canadian demand cannot absorb the volume of galvanized steel produced at the plant, making exports to the United States necessary. That reliance leaves producers exposed when access to the U.S. market is constrained, while also illustrating why the industry group is seeking greater domestic demand through procurement policy. [1]
Industry Minister Mélanie Joly has challenged the company’s plans in writing. Her letter to Stelco president Paul Simon expressed extreme disappointment and cited commitments associated with Cleveland-Cliffs’ 2024 acquisition of Stelco to maintain unionized and non-unionized employment levels, regardless of business strategy or market conditions. The federal response signals a potential effort to hold the company to those conditions, but the report does not establish that the layoffs have been reversed or that procurement rules have changed. [1]
This is a moderate-significance industry-impact development because the Canadian Steel Producers Association is publicly advising that U.S. steel tariffs may endure, while a major Canadian producer’s planned roughly 350-worker layoff highlights the exposure created by dependence on U.S. export demand. The rating is not higher because the report documents an assessment and policy request rather than a newly imposed tariff, confirmed layoff reversal, or enacted Buy Canadian measure. [1]