New trade and procurement measures aimed at increasing the use of steel from Canada have come into effect.
Prime Minister Mark Carney announced the package on Nov. 26, 2025, following months of trade disruption and high U.S. tariffs on Canadian steel. Most measures took effect on Dec. 26, 2025.
“Steel and lumber are core to Canada’s competitiveness,” Carney said at the time, adding the government was moving “with urgency and determination” to protect workers and businesses.
The policy tightened tariff-rate quotas on imported steel to shift demand toward Canadian producers. Steel imports from countries without a free trade agreement were capped at 20 percent of 2024 levels, down from 50 percent. Imports above those limits face higher duties.
For countries with a free trade agreement, excluding the United States and Mexico under the Canada–United States–Mexico Agreement, quotas were reduced to 75 percent of 2024 levels.
Canada also imposed a 25 percent tariff on selected steel-derivative products, including items such as wind towers, prefabricated buildings, fasteners and wires. The measures apply regardless of whether those products contain recycled material.
Temporary tariff remissions for some imported steel used in manufacturing and packaging were scheduled to phase out by Jan. 31, 2026, giving businesses time to adjust supply chains toward Canadian sources.
The measures followed a sharp escalation in trade pressure in 2025, when the United States raised tariffs on Canadian steel and restricted access to Canada’s largest export market. Global steel oversupply during the same period increased concerns about low-priced foreign steel being redirected into Canada.
For Canadian auto recyclers, the policy shift could influence scrap demand. When steel imports are restricted, domestic producers have historically relied more on local feedstock. Past trade actions have been associated with steadier buying programs and fewer abrupt price swings, rather than guaranteed price increases.
