New Made In America rules hurt Canadian steel, but not like tariffs did

© Can Stock Photo / akiyoko

The head of the Canadian Steel Producers Association wants to be precise. New Made In American rules hurt, but not like the U.S. tariffs hurt steel producers.

Catherine Cobden admitted an executive order signed Monday by U.S. President Trump hurts Canadian steel producers on two fronts. First, the new rules mean 95 per cent of components used in U.S. federal public projects must be of U.S. origin. Secondly, the timing of the executive order comes when Canadian steel producers are still recovering after American tariffs on Canadian steel were lifted in May.

As for other materials, 75 per cent must be made in the U.S. That is up from 50 per cent previously.

“We lost over a billion dollars in investments. We have paid over a billion dollars in tariffs. We had thousands of job losses. We are on very tender ground in terms of re-establishing and building the financial performance of the industry,” said Cobden.

However, Cobden stressed the executive order only applies to federal procurement projects.

“It’s not applicable to the entire U.S. market,” she said. “While we’re discouraged and disappointed in the development. It’s not in the same order of the tariffs.”

Made In America rules are not new. They have been in place for years, and steel producers have been pressuring the federal government to get an exemption. Cobden said there are a couple of options Ottawa should consider pursuing.

“Would that be an exemption? Would that be Buy North American rather than Buy American?” she explained. “There’s different methods. That’s all we’re looking for, is the ability to serve the market in a free and fair way.”

The rules also do not just apply to Canada. They apply to all non-American steel. However, Cobden said the trick is persuading the U.S. government Canadian steel is different.

“The real issue is that in the big picture of the world, there is an overcapacity of steel. That over-capacity is often supported by heavy government subsidies, poor labour situations, poor environmental performance,” she said. “In North America, we stand well above that in all of those aspects.”