Trump to raise steel tariffs to 50% to help Nippon-U.S. steel deal
President Donald Trump said he would be increasing tariffs on steel to 50% from 25%, saying the move would help protect American steelworkers during a visit to a United States Steel Corp. plant on Friday.
Trump was visiting the plant to champion an expected deal between United States Steel Corp. and Japan's Nippon Steel Corp. as one that would ensure the iconic American firm remains U.S.-owned and operated, even as details on the agreement remain vague. He said the new tariffs would benefit the new venture's US operations.
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Winnipeg Free Press
43 minutes ago
- Winnipeg Free Press
‘Hard to look at the bright side'
Lost sales, higher prices and material shortages have recently hit Manitoba businesses reliant on steel and aluminum — and it could get worse. U.S. President Donald Trump announced last week he'd raise tariffs on steel and aluminum imports to 50 per cent, a doubling of the current levy. As of Monday afternoon, the change is proposed to begin Wednesday. Current tariffs already have a 'deep and profound' impact across the supply chain, said Catherine Cobden, president of the Canadian Steel Producers Association. MIKE DEAL / FREE PRESS Steel in various forms wait to be shipped to customers. Premier Wab Kinew and Selkirk Mayor Larry Johannson speak flanked by employees and in front of a giant Canadian flag hanging in one of the buildings at the Gerdau Manitoba Steel Mill, 27 Main St., Selkirk, Thursday morning. Reporter: Gabrielle Piche 250327 - Thursday, March 27, 2025. Gerdau SA's Selkirk steel plant is a CSPA member. A majority of the company's steel is exported to the United States; it employs upwards of 500 Manitobans. Gerdau previously directed a reporter to the CSPA for comment. Across Canada, steel shipments to the United States dropped roughly 30 per cent in April, Cobden said. Twenty-five per cent tariffs came into effect in March. 'This will close the market for Canadian exports to the United States,' Cobden said of the prospect of a 50 per cent levy. Selkirk Mayor Larry Johansson considers himself an 'optimistic kind of mayor.' '(But) it's hard to look at the bright side when they raise the tariffs another 25 per cent,' he said. For now, he's clocked activity in Gerdau's lot — plenty of semi-trucks. Gerdau employees haven't been laid off to date, the United Steelworkers confirmed. A 50 per cent tariff would be a 'massive challenge' to Gerdau and similar mills, said Scott Lunny, a United Steelworkers director. 'Who pays the price for that, often, is workers.' 'There's customers I supply in the U.S. that, when he does things like this, they just stop buying and wait six weeks.'– Richard Bobrowski, Imperial Steel owner Meantime, Imperial Steel hasn't laid off staff, despite recording a 25 per cent drop in sales year-over-year. The Winnipeg company, which makes thin-wall steel tubing, exported roughly 70 per cent of its products to the U.S. in 2024. 'You get going for a few weeks, and all of a sudden the president of the United States makes a statement,' said Richard Bobrowski, Imperial Steel owner. 'There's customers I supply in the U.S. that, when he does things like this, they just stop buying and wait six weeks.' American clients are sourcing within their home country more, Bobrowski added. Imperial Steel struggles to give consistent pricing — between tariff changes and recent steel price fluctuations — and U.S. customers are hesitant to sign on, wondering what change could occur before a shipment arrives. Imperial Steel currently splits the 25 per cent import tariff with its American patrons. It made a decision Monday: it won't swallow more than 12.5 per cent of a 50 per cent tariff. 'Which will then stress our company's ability to compete,' Bobrowski said. 'That's when the government has got to get involved.' The Manitoba government tabbed $300 million for tariff-impacted businesses and farmers in its Budget 2025 contingency plan. The funding hasn't yet been used. Evolution Wheel has avoided tariffs on both sides of the border, said owner Derek Hird. The Winnipeg-based construction-grade solid tire maker imports steel from the United States; it's exempt from Canada's reciprocal tariffs because of a carve-out for manufacturers. The company mainly ships south of the border. But the turnaround time has lengthened — Evolution Wheel hasn't been able to source the specific steel it needs. 'Companies … are just buying up huge amounts of stock, and there's no supply,' Hird said. 'You're … fighting for scraps on what's available in the market right now.' 'Companies … are just buying up huge amounts of stock, and there's no supply,' Hird said. 'You're … fighting for scraps on what's available in the market right now.'– Evolution Wheel owner Derek Hird Supply chain issues have resulted in lost sales, Hird added. Meantime, he's paying more for the steel he purchases. So, too, is Northern Steel Buildings, a steel shop enterprise in Morden. It gets steel from Canada and the United States, and it pays Canada's 25 per cent reciprocal tariff. The tariffed products can be cheaper than Canadian steel, said general manager Rick Friesen. That won't be the case if a 50 per cent fee comes online on Canada's side. 'If the Canadian government decides to retaliate … I think that will hinder the Canadian economy and growth,' Friesen said. The economic uncertainty is damaging, said Chuck Davidson, president of the Manitoba Chambers of Commerce. 'We continue to … move the goalposts at the whim of the (U.S.) president.' If businesses feel further tariff effects, government assistance could be needed, he added. The Canadian Steel Producers Association is calling for Ottawa to implement tariffs to incentivize domestic steel use. Local producers compete with unfairly traded international steel that retails cheaper, Cobden asserted. Manitoba is among the jurisdictions pledging to use more Canadian steel. In March, Premier Wab Kinew declared government infrastructure projects requiring steel would source Canadian. These announcements are appreciated, Cobden said, but the projects might be too late to mitigate the damage of a 50 per cent tariff. 'If the Canadian government decides to retaliate … I think that will hinder the Canadian economy and growth.'– Northern Steel Buildings general manager Rick Friesen However such a levy isn't a given, said Gary Mar, Canada West Foundation president. 'I think the best idea is to … wait and see what the president actually does first.' Monday Mornings The latest local business news and a lookahead to the coming week. He believes Americans will push back against tariffs as they feel pain in their pocketbooks. The impact hasn't reached its peak, Mar stated, noting hundreds of U.S. politicians will run for office again next year. Meantime, Manitoba companies are attempting to dodge tariffs. Northern Steel Buildings is consulting agencies about a reciprocal tariff exemption. It's heard of other companies being successful, Friesen said. Eascan Automation in Winnipeg, which creates robots, is tapping Canadian companies to bulk order aluminum goods from Europe for direct shipment into Canada. The goal is tricky because Eascan orders custom parts and its supplier distribution centres are in the United States, said chief executive Camila Bellon. Canada exported $20 billion worth of steel and iron to the U.S. last year and $4.1 billion in aluminum, per Natural Resources Canada data. Gabrielle PichéReporter Gabrielle Piché reports on business for the Free Press. She interned at the Free Press and worked for its sister outlet, Canstar Community News, before entering the business beat in 2021. Read more about Gabrielle. Every piece of reporting Gabrielle produces is reviewed by an editing team before it is posted online or published in print — part of the Free Press's tradition, since 1872, of producing reliable independent journalism. Read more about Free Press's history and mandate, and learn how our newsroom operates. Our newsroom depends on a growing audience of readers to power our journalism. If you are not a paid reader, please consider becoming a subscriber. Our newsroom depends on its audience of readers to power our journalism. Thank you for your support.
Canada Standard
an hour ago
- Canada Standard
What are Canada's governing Liberals going to do about AI?
Fresh off his election victory, Prime Minister Mark Carney has been focused on standing up to Donald Trump's claims on Canada as the 51st state and American tariffs. But while that political drama unfolds, one topic that seems to have quietly slipped under the radar is the rise of artificial intelligence. Despite its transformative impact on everything from jobs to national security, AI received surprisingly little attention during the campaign and in the first weeks following Carney's victory. The consequences of that lack of attention are already starting to show, as emissions and electricity costs continue unabated without a clear vision of where AI fits in. Read more: Anxious over AI? One way to cope is by building your uniquely human skills Although Carney has appointed former journalist Evan Solomon as Canada's first-ever AI minister, it's not yet clear what action the Liberal government plans to take on AI. The Liberals' "Canada Strong" plan outlining the prime minister's proposals is scarce on details. Still, it provides some clues on how the Liberals see AI and what they believe it offers to the Canadian economy - and also what they seem to have misunderstood. First, the plan includes some robust initiatives for improving Canada's digital infrastructure, which lags behind other leading countries, especially in terms of rural broadband and reliable cell service. To accomplish these goals, the Liberals say they'll incentivize investment by "introducing flow-through shares to our Canadian startup raise money faster" for AI and other technologies. In other words, they will reuse the model of mining and oil companies whereby investors can claim a tax deduction for the same amount as their investment. A major question is whether Canada's investment ecosystem has enough big players willing to take these risks. The plan gets less promising as it comes to the implementation of AI within "the economy of tomorrow." The Liberals say they plan to build more data centres, improve computing capacity and create digital supply chain solutions "to improve efficiency and reduce costs for Canadians." All that that sounds OK - so far. But how will they do this? The Liberals plan to establish the Bureau of Research, Engineering and Advanced Leadership in Science (BOREALIS), linking AI development directly to the Canadian Armed Forces and the Communications Security Establishment Canada, which provides the federal government with information technology security and foreign signals intelligence. This approach to AI is focused on what it offers to Canada's defence, whether by manufacturing semiconductors or improving intelligence gathering, so that it can rely less on the U.S. Similarly, Canadian defence tech firms will access funding to help reduce dependence on American suppliers and networks. The Liberals are pledging sovereignty and autonomy for Canada's defence and security, all enabled by "the construction and development of AI infrastructure." What goes unsaid is the intense power needs of data centres, and the consequences for emissions and climate action of "building the next generation of data centres" in Canada. New data centres cannot be built without also constructing more renewable energy infrastructure, and none of this addresses emissions or climate change. If the centres crop up in big numbers as planned, Canadians could also see their electricity costs go up or become less reliable. That's because finding space within the existing grid is not as easy as it may sound when AI data centres require over 100 megawatts (MW) of electricity demand versus five to 10 MW for a regular centre. With the rapidly evolving market for AI-based data centres, Canadian policymakers need to provide clear guidance to utilities in terms of their current decisions on competing industrial-scale demands. As the Canadian Climate Institute points out: "Anything less risks higher rates, increased emissions, missed economic opportunities - or all of the above." So far, the Liberal plan fails to address any of these concerns. What else does the "economy of tomorrow" hold? Apparently, it means more efficient government. According to the Liberal plan, AI "is how government improves service delivery, it is how government keeps up with the speed of business, and it is how government maximizes efficiency and reduces cost." Despite otherwise clashing with the Trump administration, this language is reminiscent of Elon Musk's Department of Government Efficiency (DOGE), which has also centred its use of AI. Read more: DOGE's AI surveillance risks silencing whistleblowers and weakening democracy The Liberals will open an Office of Digital Transformation, which aims to get rid of red tape and "reduce barriers for businesses to operate in Canada." They don't seem to really know what this would actually look like, however. They say: "This could mean using AI to address government service backlogs and improve service delivery times, so that Canadians get better services, faster." Their fiscal plan points out that this frame of thinking applies to every single expenditure: "We will look at every new dollar being spent through the lens of how AI and technology can improve service and reduce costs." The economy will also benefit, the government argues, from AI commercialization, with $46 million pegged over the next four years to connect AI researchers with businesses. This would work alongside a tax credit for small and medium-sized businesses to "leverage AI to boost their bottom lines, create jobs, and support existing employees." But a new report by Orgvue, the organizational design and planning software platform, shows that over half of businesses that rushed to impose AI just ended up making their employees redundant without clear gains in productivity. Creating a tax credit for smaller companies to introduce AI seems like a recipe for repeating the same mistake. Much of the Liberal plan seems to involve taking risks. There's a shortsightedness on this rapidly advancing technology that requires significant guardrails. The government seem to view AI as a solutions machine, buying into the hype around it without taking the time to understand it. As policy is properly hashed out in the weeks and months to come, the Liberals' feet will have to be held to the fire on the issue of AI. Canadians must benefit from its limited uses and be protected from its abuses.
Calgary Herald
an hour ago
- Calgary Herald
Bank of Canada expected to hold policy rate as bar to cut is ‘quite high'
Article content Economists expect the Bank of Canada to maintain its cautious approach by holding its policy rate in place on Wednesday as it continues to assess the impact of U.S. President Donald Trump's trade war on the Canadian economy. Article content 'We expect them to be on hold again at the June meeting,' said Jason Daw, head of North American rate strategy at the Royal Bank of Canada. 'Given that they went on hold at the April meeting, the bar for them to cut again would be quite high, and the data that we've had in the interim has been mixed and not really sending them a signal to do anything at this time.' Article content Article content Canada's central bank remains in a tight spot, as it weighs the upside risks to inflation against the downside risks to growth brought on by U.S. tariffs. Daw said the market is putting the likelihood of a policy rate cut on Wednesday at just 25 per cent and has only priced in one-and-a-half cuts for the remainder of the year. The Bank of Canada's policy rate currently sits at 2.75 per cent, after it paused for the first time at its April meeting, following seven consecutive cuts. Article content Article content In April, core measures of inflation ran above three per cent and GDP for the first quarter came in better than expected, at an annual rate of 2.2 per cent, higher than the 1.8 per cent Bank of Canada forecast. Article content While the headline number was positive, much of the growth was driven by exports and inventory building, as businesses raced to get ahead of Trump's tariff announcements at the beginning of the year. Under the surface, final domestic demand was flat and residential investment contracted. A flash estimate for April by Statistics Canada showed the economy grew at a monthly rate of 0.1 per cent. Article content Article content Article content Desjardins Group chief economist Jimmy Jean said he disagrees with the market assessment and still expects a rate cut on Wednesday. Jean said the Bank of Canada should be looking through the strong headline GDP number and focus its attention on underlying weaknesses in the economy, including the flat household spending and final domestic demand, in addition to the weakness in the Canadian housing market. Desjardins is forecasting the economy will begin to contract in the second quarter of this year. Article content Article content 'To me this is almost a no-brainer that they should cut and look through those very fleeting influences,' Jean said. Article content Data in April also showed a deterioration in the labour market brought on by the trade war. The unemployment rate rose to 6.9 per cent during the month, as employment in the manufacturing sector fell by 31,000 due to tariff uncertainty. Economists expect the jobless rate to peak above seven per cent this year.
