This past Tuesday afternoon, the U.S. Trade Representative announced that after consultations with the Canadian government, the U.S. government had determined they would place the recently imposed 10% tariff on hold, and instead, they would impose a quota system on Canadian aluminum. The U.S. quotas limit Canadian aluminum exports to be between 70,000 and 83,000 tonnes per month until December. If Canadian exports exceed the quota by more than 5% the tariffs will be applied retroactively.

The reversal comes the same day that Canada was expected to unveil its plans for retaliation. The new U.S. trade decision led Prime Minister Justin Trudeau and Deputy Prime Minister Chrystia Freeland to suspend their plans of imposing retaliatory tariffs of $3.6 billion in US aluminium products. “These measures were an error from the very beginning,” said Chrystia Freeland, “this is really a day when common sense has prevailed and that’s good news.”

Canadian and American aluminum producers have been complaining for weeks about the negative consequences that the tariffs were inevitably going to bring to their industry. Though we believe the quotas are as misguided as the tariffs, it is our hope that the lifting of the tariffs will ease some of the tension between countries allowing them to focus in their efforts for economic recovery.

Written by: Ariana Delgado

Last modified: September 18, 2020