U.S. hits Canada with metal tariffs, Canada hits back

Canada is hitting back against “totally unacceptable” U.S. tariffs on Canadian steel and aluminum.

Canada’s Minister of Foreign Affairs Chrystia Freeland said today that the federal government will impose duties worth $16.6 billion on American steel, aluminum and other products

The dollar figure represents the amount of steel and aluminum that Canada exported to the U.S. in 2017.

Freeland, in an Ottawa press conference with Prime Minister Justin Trudeau this afternoon, said the tariffs will take effect on July 1 and will remain in force until the U.S. drops its tariffs on Canadian steel and aluminum.

The list of U.S. goods subject to duties is posted on a federal government website, here.

The list includes many food and drink items, such as:

• Ketchup

• Yogurt

• Whisky

• Coffee

• Pizza

• Orange juice

• Prepared meats, of bovine

• Waters, including mineral waters

Also on the list are some agricultural products, specifically fungicides, insecticides and herbicides.

U.S. steel imports will be hit with a 25 percent tariff, while other products will have a 10 percent duty. The proposed list isn’t set in stone, as the federal government plans to consult with Canadians about the retaliatory measures for the next 15 days.

The tariffs are in response to a U.S. decision, announced Thursday morning.

U.S. Commerce Secretary Wilbur Ross said America will impose import tariffs of 25 percent on steel and 10 percent on aluminum, for Canada, Mexico and the EU.

The move wasn’t a shock, as President Donald Trump and U.S. Trade Representative Robert Lighthizer unveiled the tariffs earlier this year. They have held off on formally implementing the tariffs on Canada, Mexico and the EU, until now.

Trudeau, who spoke briefly at the Ottawa press event to announce the response, said the U.S. tariffs were “totally unacceptable.”

Europe and Mexico also responded to the U.S. decision.

Mexico announced tariffs on imports of U.S. pork bellies, grapes, apples and other goods.

The EU also fired back, saying it would impose duties on long list of U.S. products, such as Kentucky bourbon and Harley Davidson motorbikes.

The tariffs on steel and aluminum for Canada, Mexico and the EU might be a temporary tactic, but U.S. agriculture industry groups were displeased by the decision.

“This announcement opens the floodgates to billions in new tariffs on American agriculture…. These tariffs will harm U.S. farmers and take many American farm operations to the breaking point,” said Brian Kuehl, executive director of Farmers for Free Trade, a U.S. lobby group.

Kuehl said American farmers will suffer because the affected nations are targeting American ag commodities and agri-food products.

“The addition of new retaliatory tariffs on everything from bourbon, to rice, to orange juice and cranberries, will only widen the pain to additional farmers across the country.”

In addition to the steel and aluminum tariffs, Trump is also engaged in a trade war with China. The Chinese have proposed retaliatory tariffs on key U.S. commodities like soybeans and pork.

Kuehl said American producers are sick of the trade skirmishes and day to day uncertainty around trade.

“American farmers overwhelmingly supported President Trump in 2016 but will not be silent in the face of trade wars that harm U.S. agriculture. This summer, as lawmakers return home, the voices of farmers who are bearing the brunt of trade chaos… will be heard.”

The National Corn Growers Association also took aim at the duties on steel and aluminum, questioning why the U.S. is provoking a trade war with its closest allies.

“Imposing tariffs has the potential to undermine positive relationships… and erode long-standing market access,” said North Dakota farmer Kevin Skunes. “NCGA urges policymakers to strengthen cooperation with our trading partners and stay at the negotiating table.”

Trump said he would slap tariffs on Canada and Mexico if the negotiations around the North American Free Trade Agreement were stalled or not moving in the right direction, for the U.S.

The three countries have been negotiating a new NAFTA deal since last August, but finalizing a deal in 2018 now looks extremely unlikely.

Contact robert.arnason@producer.com

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