BURST
Canada’s steel producers have a message for B.C.’s construction sector that has found it difficult to buy domestically produced steel for the major projects they have built in the past.
Tariffs in the U.S. trade war that have escalated from 25 per cent to 50 per cent over the last 10 months have caused cross-border exports to collapse, according to Catherine Cobden, president of the Canadian Steel Producers Association.
That changes domestic market dynamics in terms of the industry’s ability to supply steel to B.C.
“Old assumptions don’t apply,” Cobden said in an interview. “In other words, we have a lot of steel (and) we are very competitive on fairly traded prices.”
Canada produces about 12 million tonnes of steel per year, Cobden said, and previously exported half of it to the U.S. Those exports, however, have fallen by three million tonnes per year and continue to plummet under the U.S. tariff regime.
Diversifying exports is next to impossible in a global market that has a glut of some 600 million tonnes per year of excess steel production, she added.
Cobden led a contingent of industry executives to Victoria this week to lobby for B.C. support on measures to support Canadian steel, arguing that they make sense for an industry “that’s of strategic value to the Canadian economy.”
Prime Minister Mark Carney first unveiled his ideas for a “Buy Canadian” policy favouring Canadian steel, aluminum and lumber in procurement on federally financed projects in September, adding more details in November’s federal budget.
According to documents online, Carney wants to have the policy in place by the spring of 2026 prioritizing Canadian-made materials, or those from “trusted partners” that allow equal market access on some $70 billion worth of federal projects, to make government “our own best customer.”
The prime minister also wants to extend the policy to include the “nation building” industrial projects under consideration for fast-track approval through his recently created Major Projects Office. Four projects on that list already are located in B.C.
Those measures are on top of the tariff measures Carney introduced in July, which added restrictions on tariff-free imports of steel from countries other than the U.S. American products face a tariff of 25 per cent.
B.C.’s construction sector, however, has raised a red flag concerning potential burdens such a policy would put on the West Coast, which is far removed from many of Canada’s steel producers.
B.C.’s Independent Contractors and Business Association CEO Chris Gardner, for instance, recently argued in an opinion article that retaliatory tariffs are effectively a tax on Canadian businesses and consumers, especially when applied to housing and infrastructure.
Association chief economist Jock Finlayson said shipping domestic steel by rail from Ontario to B.C. is more expensive than importing steel from Asia by sea.
Putting tariffs on imports to protect Canadian mills is like “shooting ourselves in the foot,” Finlayson said, arguing Canada would be better off resolving the trade dispute with the U.S.
B.C. Construction Association CEO Chris Atchison added that Canadian steel mills don’t make “the full spectrum of construction-grade products” the industry uses and in the quantities that it needs.
Cobden, however, said Canada’s collapsing exports change that dynamic. She said her association has held discussions with the country’s key railways, CN and CPKC, which have told the association they have the capacity to transport more steel and an interest in co-operating on prices.
“The railways say that they will compete on price for this business,” Cobden said. “They too have lost business to the United States.”
As for the industry not making products builders need, research by the Canadian Steel Producers Association found that their mills produce about 80 per cent of the items that Canada imports, Cobden said, including the estimated annual 1.5 million tonnes of steel brought in through the Port of Vancouver.
“That’s a significant volume of steel, especially for an industry like ours that has just lost market access to the United States,” Cobden said.
“I think we have come to the conclusion as an industry that our U.S. market access has probably changed in some manner for a very long time, so we need to adjust our business models accordingly.”