Carney Unveils New Measures to Bolster Canadian Steel and Lumber Industries

Prime Minister Mark Carney has announced several new initiatives aimed at revitalizing Canada’s steel and lumber industries. These measures are designed to fortify the sectors against the impact of U.S. tariffs, which have significantly affected their performance.

New Measures for the Steel and Lumber Industries

The Canadian government is introducing changes that will reduce foreign imports of steel and boost domestic production. This announcement comes as the steel and lumber sectors face increased pressure from U.S. tariffs.

Tariff Adjustments and Their Implications

• For countries without a free trade agreement with Canada, tariff rate quotas for steel imports will be decreased from 50% to 20% of 2024 levels.
• For countries with a free trade agreement, excluding the U.S. and Mexico, quotas will drop from 100% to 75% of 2024 levels.

According to Carney, these adjustments could potentially create over $850 million in domestic demand for Canadian steel. The goal is to empower local industries to better compete against foreign imports.

Support for Lumber Producers

In addition to steel, the government will provide substantial support for the lumber industry, which has also suffered due to U.S. tariffs that reach as high as 45%. A total of $500 million will be allocated from the large enterprise tariff loan facility to assist lumber firms facing financial difficulties.

• An additional $500 million will be made available through the Business Development Bank of Canada’s softwood lumber guarantee program.
• A streamlined process will be implemented for companies to access support programs.

The premier of British Columbia, David Eby, previously urged the government to act swiftly, calling the situation a national emergency.

Freight Rate Subsidies

To further support these industries, the Canadian government intends to reduce freight rates for transporting steel and lumber by 50%. This initiative will commence in the spring and is expected to cost approximately $146 million over one year.

Industry Reactions and Future Outlook

Catherine Cobden, president of the Canadian Steel Producers Association, has expressed optimism about the new measures, stating they give the industry a “fighting chance.” Derek Nighbor, CEO of the Forest Products Association of Canada, also welcomed the measures and emphasized the importance of timely execution.

The Canadian steel and lumber sectors are navigating challenging conditions exacerbated by ongoing trade tensions with the U.S. As Carney aims to bolster these industries, he emphasizes the necessity for effective government support and adjustment to new market realities.