Don’t treat us like North Korea: Canadian aluminum producers offended by Trump
Jeff Lagerquist, CTVNews.ca Staff
Published Saturday, March 3, 2018 3:52PM EST
Last Updated Saturday, March 3, 2018 6:24PM EST
A group representing Canada’s aluminum producers is angry that a seven-decade trade relationship with the U.S. is being undermined by President Donald Trump’s threats to impose tariffs on foreign metals.
Trump announced the tariffs on Thursday, telling a group of U.S. metal industry executives that imported steel will be slapped with a 25 per cent tariff and foreign aluminum will face a 10 per cent tariff. Canada is the top supplier of both to the U.S., with $15 billion a year in combined sales.
Trump has partially justified the proposed duties with a Cold War-era law that was meant to ensure the U.S. is not forced to rely on imports from unfriendly nations if war disrupts global trade. The plans for tariffs on aluminum and steel follow a report from the U.S. Department of Commerce that suggests cheap imports are a national security threat.
That justification has been particularly hard for Aluminum Association of Canada president Jean Simard to accept.
“I find it very contemptuous,” he told CTV News Channel on Saturday. “The U.S. has been provided by Canada with responsibly-produced, low carbon, fairly traded aluminum for about 70 years. (Now) we are dealt with like we were North Korea.”
Trump has not spelled out how the tariffs could be applied to Canada, or other nations, offering only passing remarks via Twitter about the benefits of “easy to win” trade wars and recovering lost jobs.
Prime Minister Justin Trudeau has said Trump’s security threat premise “makes no sense” when it comes to Canada.
“That's why this is absolutely unacceptable, and it's a point we've made many times, that I've made directly with the president,” he said at an event in Barrie, Ont., on Friday. “It's one that we're going continue to engage with all levels of the U.S. administration on.”
The U.S. purchased 86 per cent of Canada’s aluminum exports in 2016 at a cost of US$6.98 billion, according to figures from the United Nations COMTRADE database on international trade. About 90 per cent of the aluminum used by U.S. companies to produce everything from beer cans to fighter jets comes from outside the country.
“Today the average plant in the U.S. is about 40 years old. It’s not competitive. The price of energy is too high to be competitive,” Simard said. “What the president has announced is more of a protectionist measure than anything else to try to bring back jobs that will cost a tremendous amount of money to the U.S. economy.”
Simard said U.S. manufactures have gotten used to “tremendously” cheaper prices thanks to China’s massive aluminum production capacity, while domestic smelters have sat idle. He predicts the resulting upward pressure on aluminum prices will weigh on the U.S. economy, and said a maximum of only 1,900 jobs stand to be gained.
“The last economic analysis as of yesterday demonstrates that they are going to kill 20,000 to 90,000 jobs in the downstream industry, because basically the U.S. will now be paying 10 per cent more for their aluminum than in the rest of the world,” Simard said.