Ottawa targets steel, aluminum in $1.5B tariff relief funding

In response to the United States expanding its tariff criteria last month, the federal government has pledged $1.5 billion in relief.

This financial support comprises a $500 million increase for the regional tariff response fund and the establishment of a $1 billion Business Development Bank of Canada initiative designed to strengthen the manufacturing industry.

The new billion-dollar program is meant to support factories affected by U.S. tariffs, specifically those who export steel, aluminum and copper.

Three-year, low-interest loans of up to $50 million are said to be made available to tariff-hit businesses.

Industry Minister Mélanie Joly says the program is aimed at addressing the pressure on these businesses, but the owner of a Hamilton aluminum products business says it’s “certainly not a game changer.”

Chedo Sobot, the owner of Hamilton’s Sobotec Ltd. that makes aluminum wall panel systems and has been selling them in the U.S. for three decades, says the new loan program isn’t what he wants from Ottawa.

“I don’t feel it’s that critical,” said Sobot. “I think challenging this tariff is more what I would like to see the government do.”

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Sobot says the tariffs make no business sense and he thinks Prime Minister Mark Carney’s Liberal government should focus on getting the Trump administration to see that.

He says that the U.S. needs Canadian aluminum.

“There isn’t enough cast and smelt aluminum produced to satisfy their own needs,” said Sobot.

He also said that the tariffs push costs and prices up for people and businesses on both sides of the border, and arguing Canadian companies are not dumping cheap aluminum products on the American market.

“The pricing we have now that’s higher, they will catch up to that as well,” said Sobot. “We’re not disadvantaging (sic) the companies that compete against us down there, the pricing is quite similar.”

“This decision has impacts in Hamilton,” said Joly.

The industry minister announced the new relief regime for steel, aluminum and copper businesses Monday morning, saying the Business Development Bank of Canada will offer three-year loans, for between $2 and $50 million, with no or low-interest terms.

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“Short-term, our goal is to provide liquidities to companies in order for them to keep their workers,” said Joly. “Medium-term, what we’re trying to do is really to help businesses adapt, pivot, try to get into new markets.”

Joly says the plan is a response to the Trump administration upping the pressure on Canadian manufacturers with changes to existing tariffs on steel, aluminum and copper, that came into effect April 6.

In Hamilton, Sobot says he will consider the loan program as he navigates the turbulence caused by the tariffs.

“I’m trying to figure out how it will help me maintain my current capacity,” said Sobot. “Thats my biggest challenge right now.”

With files from The Canadian Press. 

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