Nations denounce Trump tariff on metals and warn of retaliation

Trump's announcement of the tariffs took leaders in Canada and Mexico, the United States' biggest trading partners, especially by surprise.

Nations targeted by President Donald Trump's tariffs on steel and aluminum decried the measures as unfair Tuesday and threatened to retaliate in a growing trade dispute that threatens to further roil economic markets and strain the United States' relations with major allies.

Prime Minister Justin Trudeau of Canada, the United States' biggest supplier of both metals, described Trump's 25% tariffs on all steel and aluminum imports as "unjustified" and "unacceptable."

Trudeau said he hoped to avert the imposition of the tariffs -- which will not go into effect until March 12 -- by highlighting their "negative impacts on Americans and Canadians."

He added that Canada would "also be working with our international partners and friends" to pressure the Trump administration. Asked whether he was ready to respond with countertariffs, Trudeau said Canada "will stand up strongly and firmly if we need to."

European countries also warned of retaliation in response to Trump's tariffs. Ursula von der Leyen, the president of the European Commission, called the levies "unjustified.''

Leaders in Mexico said the tariffs were "unjustifiable" and risked undermining the economic integration of the North American market that was forged over the past two generations.

Noting that the United States has a trade surplus with Mexico in steel and aluminum, Marcelo Ebrard, the country's secretary of the economy, said he planned to appeal to Trump's common sense to try to fend off the tariffs.

"We take his word for it -- common sense -- not shooting ourselves in the foot, not destroying what we have built in 40 years," Ebrard told reporters.

Trump's announcement of the tariffs on Monday took leaders in Canada and Mexico, the United States' biggest trading partners, especially by surprise. Last month, the president threatened 25% tariffs on all imports from both nations, prompting them to warn of retaliation.

But a trade war was averted at the last minute when Trump and the leaders of both countries reached separate deals that yielded a 30-day postponement of the tariffs last week. Both agreements involve beefing up security at the borders the United States shares with Mexico and Canada.

The sudden imposition of tariffs on Canada's steel and aluminum weeks before the end of the reprieve left political and business leaders in the country feeling whipsawed. Canada's economy is much smaller than the United States' and would suffer significantly from the tariffs. It now faces a repeat of the down-to-the-wire negotiations that have dominated news coverage in recent weeks.

The tariffs are likely to deepen Canada's mistrust of the Trump administration, heighten feelings of betrayal among Canadians and further fuel discussions about the need to strengthen ties to countries other than the United States.

Trump revealed that he was prepared to impose 25% tariffs on all steel and aluminum imports into the United States on Sunday while speaking to reporters aboard Air Force One en route to the Super Bowl.

Canada was the biggest supplier of steel to the United States last year, followed by Brazil and Mexico. It is also a major supplier of aluminum to the United States.

Canada's steel industry, which employs 23,000 people, exports almost all of its products to the United States. There is little demand for Canadian steel in other markets, which are increasingly dominated by China.

The aluminum sector, which employs 9,000 people in Canada, is more competitive globally, though the United States is its major buyer.

During his first term, Trump levied tariffs on steel and aluminum imports from all over the world, angering Canada, Mexico and other allies. He eventually exempted major steel-producing countries such as Brazil, South Korea and Australia in exchange for quotas limiting their exports to the United States. He removed the barriers on steel and aluminum for Canada and Mexico with the signing of a revised trade agreement among the three countries.

This time, Trump has laced tariff threats against Canada with talk of annexing the country and turning it into the 51st state. While the government initially dismissed Trump's comment as a joke, Trudeau told business leaders Friday that he regarded the threat as real.

Trump, in an interview with Fox News on Sunday, said that he was serious about annexing Canada.

On Tuesday, Trudeau pushed back against Trump.

"This is a moment of pride," Trudeau said, speaking in Paris where he was attending a conference on artificial intelligence. "This is a moment of pulling together. This is a moment for Canada to be solid in our identity."

Mexico was the third largest supplier of steel to the United States in 2024, according to the American Iron and Steel Institute.

A spokesperson for the Mexican steel trade association, Canacero, said it would wait to assess the impact on the industry, which is concentrated in northern Mexico and supplies steel for everything from cars to washing machines to construction materials.

When Trump imposed tariffs in his first term -- 25% on steel and 10% on aluminum -- Mexico retaliated with countertariffs on key American products, including pork, apples, cheese, cranberries, bourbon whiskey and Harley Davidson motorcycles, according to Valeria Moy, the general director of the Mexican Institute for Competitiveness.

The tariffs were lifted about a year later with the signing of the revised free trade agreement among the United States, Canada and Mexico.

While the short-lived tariffs on steel and aluminum did not lead to significant gains for U.S. manufacturers, Moy said that it was not surprising that Trump was considering turning to them again.

"It represents a win that's easy for Trump to communicate," Moy said. "It benefits -- in the short term -- an industry that's become emblematic in the United States."

Brazil exported $4.5 billion worth of steel to the United States last year. The United States was by far the largest international market for Brazilian steel, but that represented only about 11% of Brazil's steel sales, most of which are domestic.

The last time Trump implemented tariffs against steel imports, he largely exempted Brazil. Experts believed at the time that because the United States had a trade surplus with Brazil, Trump did not see it necessary to target the country with tariffs, said Carla Beni, an economist who tracks international trade at the Fundação Getulio Vargas, a university in Brazil.

Tariffs on Brazilian steel could backfire on the United States, Beni said. Brazil imports more than $1 billion a year in coal from the United States -- much of it to make steel -- so harming the Brazilian steel industry could hit the U.S. coal industry, she said.

"This could be very interesting for Brazil at the negotiating table," she said. "Because if I produce less steel, I'm going to need less coal."