Canada Fires Back: 50% Counter-Tariff on Steel from US Effective Sept. 8
Canada on Tuesday announced counter-tariffs on C$27.6 billion (about US$19.9 billion) of American goods, doubling its duty on US steel and aluminum to 50% effective 12:01 a.m. September 8, in what Ottawa billed as a “dollar for dollar, rate for rate” answer to Washington.
“Canada must respond, and today we are, in a proportionate, targeted, and strategic way,” Finance Minister François-Philippe Champagne said at a news conference in Ottawa, per Reuters. “Effective September 8, Canada will impose counter tariffs of up to 15, 25, or 50 percent on $27.6 billion in imports from the United States of America.” He added: “When the United States of America asked too much and offered too little, we made a choice. We chose Canada.”
For the steel trade, the headline number is the rate reset. Steel and aluminum products that had been carrying a 25% Canadian counter-tariff move to 50%, matching the US Section 232 rate on Canadian metal, according to the Department of Finance Canada. Certain steel and aluminum derivative products land in the 25% bucket, alongside appliances, cheese, and fish and seafood. Electronics and tools take 15%. In all, more than 700 US product lines are covered, drawn from goods targeted by US Section 338 and Section 232 actions. Existing Canadian counter-tariffs, including those on autos, stay in place, and Ottawa’s tariff remission framework remains available for exceptional-relief requests.
The retaliation follows the collapse of talks late Friday and the US imposition, at midnight Saturday, of 50% tariffs on roughly $20 billion of Canadian goods, covering wine, furniture, dairy, cement, clothing and hockey equipment, and notably not exempting USMCA-qualifying products. Prime Minister Mark Carney suspended negotiations, telling reporters in Ottawa that “we cannot accept what they have offered, and we will not give what they have asked.” He said Canada had been prepared to drop its remaining steel, aluminum and auto counter-tariffs had Washington substantially lowered its own.
US Trade Representative Jamieson Greer said the administration had offered to cut tariffs on steel, autos and lumber, and that Washington is “moving forward with measures that respond to Canadian retaliation.” President Trump has separately threatened to double tariffs on Canadian vehicles, auto parts, steel and trucks to 50% starting January 1, 2027.
Ottawa paired the tariff list with a C$7.5 billion support package for exposed workers and companies, including cash-flow funding for small and medium-sized businesses and a new Canada Strong Diversification Fund administered through the Strategic Response Fund.
What Is Impacted: US Steel Exports to Canada by Product
The US imposed 25% Section 232 duties on Canadian steel in March 2025 and raised them to 50% in June 2025. Canada responded with a 25% counter-tariff on US-made steel, which it kept in place when it removed most of its other surtaxes on US goods effective September 1, 2025. WSD analysis of Canada-reported import data (mirror statistics for US exports) shows the US shipped 2.55 million net tons of steel products to Canada in 2025, down 24.3% from 3.37 million net tons in 2024. January–June 2026 volume was 1.14 million net tons, down 20.0% from 1.42 million net tons in the first half of 2025. June 2026 shipments of 191,380 net tons were roughly level with June 2025 at 193,498 net tons. The US share of total Canadian steel imports was 38.5% year-to-date, up from 36.9% for full-year 2025.
Sheet products account for the majority of the remaining trade. On the WSD sheet definition (galvanized, HR wide strip including coil plate, CR plate and sheet, other coated, HR and CR narrow strip, electrical and tinmill, excluding cut-to-length plate), the US shipped 1.46 million net tons to Canada in 2025, or 57.3% of all US steel tonnage crossing north. The sheet subtotal was 690,159 net tons in the first half of 2026, down 8.9% year-on-year, and sheet’s share of the total rose to 60.8%. On an annualized basis, US sheet exports to Canada have fallen about 518,000 net tons since the start of 2024, from 1.90 million to 1.38 million.
By class, galvanized is the largest line item in the trade, at 567,083 net tons in 2025 (22.2% of all US steel exports to Canada) and 259,524 net tons in H1 2026, down 9.4%. HR wide strip including plate in coil was 282,683 net tons in 2025 and 138,617 net tons in H1 2026, down 3.7%, with June up 18.8% year-on-year. Cold-rolled splits two ways in the WSD scheme: CR plate and sheet at 99,324 net tons in H1 2026, down 10.3%, and CR narrow strip at 64,327 net tons, up 7.3%. HR narrow strip fell 18.7% to 85,626 net tons, other coated fell 25.5% to 19,665 net tons, and electrical steel was near flat at 20,601 net tons.
On an annualized basis, doubling first-half volumes, US steel exports to Canada run at 2.27 million net tons in 2026, against 2.84 million on the 2025 first half and 3.58 million on the 2024 first half, down 20.0% year-on-year and 36.7% versus 2024. The sheet subtotal annualizes to 1.38 million net tons in 2026, from 1.52 million in 2025 and 1.90 million in 2024, a 27.3% decline over two years. Sheet’s share of the annualized total rose from 53.0% in 2024 to 60.8% in 2026. Galvanized annualizes to 519,048 net tons, down 21.0% from 2024; HR wide strip including plate in coil to 277,234 net tons, down 36.8%; other coated to 39,330 net tons, down 70.6%. Electrical steel is up 50.7% from 2024 at 41,202 net tons, and CR narrow strip is up 7.3% this year at 128,655 net tons.
US Steel Exports to Canada, Sheet Products by WSD Class (annualized net tons, H1 × 2)
| WSD product class | Ann. 2024 | Ann. 2025 | Ann. 2026 | ’26 vs ’24 |
| Galvanized | 656,677 | 572,756 | 519,048 | -21.0% |
| HR wide strip (incl. plate in coil) | 438,366 | 288,020 | 277,234 | -36.8% |
| CR plate & sheet | 272,720 | 221,381 | 198,648 | -27.2% |
| HR narrow strip | 212,996 | 210,732 | 171,251 | -19.6% |
| CR narrow strip | 138,106 | 119,927 | 128,655 | -6.8% |
| Electrical steel | 27,335 | 41,395 | 41,202 | +50.7% |
| Other coated | 133,753 | 52,825 | 39,330 | -70.6% |
| Tinmill products | 17,915 | 8,680 | 4,950 | -72.4% |
| Sheet subtotal | 1,897,868 | 1,515,717 | 1,380,319 | -27.3% |
| All steel products | 3,583,865 | 2,838,794 | 2,270,074 | -36.7% |
Source: WSD analysis of Canada-reported import statistics, Canadian Steel Trade Analysis. Annualized = January–June actual doubled; not seasonally adjusted and not a forecast. On the same method, 2024 annualizes about 6% above the true full-year figure and 2025 about 11% above, so the comparison is best read as a directional run-rate. Metric tonnes converted to net tons at 1.10231.
A significant share of this material is automotive-grade sheet sold under annual contracts already priced and placed for the year, so the September 8 rate increase will not stop those volumes immediately. Canadian vehicle assemblers and parts producers will pay a 50% duty on US-sourced coil. Automotive-exposed and advanced high-strength grades are qualified plant-by-plant and line-by-line, and requalifying a substitute supplier typically takes quarters rather than weeks. The near-term effect is higher input costs for Canadian auto manufacturing rather than a volume loss at US mills.
Whether Canadian OEMs and their suppliers source elsewhere at the next contract round is constrained by USMCA. To qualify for preferential treatment, vehicle producers must certify that at least 70% of their steel and aluminum purchases originate in North America, and from July 1, 2027 that steel must also be melted and poured in North America. Offshore coil will not meet that test. The available substitutes are Canadian domestic production and Mexican supply that can be qualified. The USMCA joint review is under way.