Canada will impose a provisional 25% tariff on seven steel products from Oct. 25 to prevent the diversion of foreign steel imports into the country in the wake of duties imposed on steel products exported to the U.S. from across the globe.
The new tariff will be applied in cases where the level of imports from trading partners exceeds historical norms, Canada's Department of Finance said. The products affected are heavy plate, concrete reinforcing bar, energy tubular products, hot-rolled sheet, pre-painted steel, stainless steel wire and wire rod.
The provisional tariffs will remain in place for 200 days. The Canadian International Trade Tribunal will carry out an inquiry to determine if final safeguards are required.
Canada also announced that companies will be granted relief from tariffs on imports of steel, aluminum and other products from the U.S. under extraordinary circumstances, such as a lack of supply in the domestic market. The country had imposed retaliatory tariffs on C$16.6 billion of steel, aluminum and other products from the U.S. in July after Washington imposed a 25% tariff on global steel imports in March.
"Relief is only provided where warranted by exceptional circumstances, and Canadian countermeasures on U.S. imports continue to apply. The government will continue to assess, on a case-by-case basis, relief applications based on market conditions including supply shortages," the department said.
Mexico's economy ministry said it will take necessary measures to protect Mexican steel exporters from the Canadian tariffs in the short term, and will use all available mechanisms under the North American Free Trade Agreement and the World Trade Organization until all Mexican steel products are excluded from Canada's planned surtaxes.
The NAFTA is set to be replaced by the U.S.-Mexico-Canada Agreement.