OTTAWA — Prime Minister Mark Carney says the federal government is rolling out a new suite of supports to shore up the domestic steel and lumber industries hit hard by U.S. tariffs.
Carney said at an event on Parliament Hill Wednesday that since U.S. President Donald Trump launched his global tariff campaign, many of Canada’s “strengths have become our vulnerabilities.”
He pointed out that in 2024, 75 per cent of Canada’s exports — and 90 per cent of its lumber, aluminum and steel exports — went to the U.S. He said Canada must now find new markets within the country for those products.
Many of the measures Carney unveiled Wednesday are aimed at boosting the use of Canadian steel and lumber in domestic homebuilding and infrastructure projects.
The new plan tightens the quota on steel imports from countries that don’t have free trade pacts with Canada from 50 per cent to 20 per cent of 2024 levels.
That measure is meant to allow Canadian steel producers to fill the gap in the domestic market, opening up an estimated $854 million in domestic demand.
Countries outside of the United States and Mexico that do have trade pacts with Canada will also see their quotas dropped from 100 per cent to 75 per cent of last year’s levels.
Any steel imported above those thresholds will be hit with a surtax of 50 per cent.
Ottawa is also levying a new global 25 per cent tariff on steel-derivate products such as wind towers, prefabricated buildings, fasteners and wires.
Those measures, which take effect on Dec. 26, include sharper declines in quotas than the measures Carney announced in July.
“We are limiting foreign steel imports to ensure that Canadian steel producers have a bigger share of the Canadian market. Doing so will unlock hundreds of millions of dollars in domestic demand for Canadian producers,” Carney said in prepared remarks.
The steel industry continues to be hammered by the 50 per cent tariffs Trump imposed in June.
Softwood lumber, which has long been a target of U.S. tariffs, is currently taxed at 45 per cent after the Trump administration increased the rate last month.
Carney also said the federal government is adding an extra $500 million in loan guarantees for the softwood lumber industry on top of other measures to encourage homebuilders to use made-in-Canada materials.
The federal affordable housing agency Build Canada Homes will also prioritize funding for shovel-ready housing projects using Canadian wood products that can start work in the next 12 months.
Carney said Build Canada Homes alone will create $70 to $140 million in new demand for Canadian wood.
With north-south supply chains hampered by tariffs, Carney also announced measures to help domestic firms send their products across the country instead.
Starting next spring, the federal government will offer subsidies to rail companies to cut freight fees in half on shipments of steel and lumber across provincial borders for a year.
Canada is also extending a remission program launched last spring that offers producers in the manufacturing, food and beverage and agricultural production industries relief on Canada’s steel tariffs. That program, which was set to expire on Dec. 15, will now end on Jan. 31 of next year.
Carney said that while that program can’t be sustained indefinitely, it will be extended again to give domestic firms more time to adjust their supply chains to use more Canadian steel.
A senior government official told a technical briefing before Carney’s announcement that this will be the last extension of the program, which was first expected to end in October but was extended for two months at that time.
Ottawa is also setting aside $100 million over two years to support work-sharing agreements, which see the federal government offer employment insurance boosts when employers have to reduce hours for staff.
The federal government says the boosted income replacement will help 26,000 Canadian workers in sectors including steel and lumber.
This report by The Canadian Press was first published Nov. 26, 2025.
Craig Lord and Nick Murray, The Canadian Press
