Suppliers in Canada, Mexico Halt US Orders Amid Trump Tariffs

Steel producers in Canada and Mexico have begun halting new orders to the United States, reflecting growing concerns over the possibility that President Donald Trump may reimpose tariffs on steel imports. While both nations were exempt from the broad steel tariffs enacted during Trump’s first administration, the industry now faces heightened uncertainty.

Trump recently signaled his intent to implement tariffs of up to 25% on steel imports from Mexico and Canada by Feb. 1, reigniting fears of trade disruptions. JPMorgan Chase & Co experts say that the proposed tariffs are likely to disrupt supply chains and significantly impact industries dependent on these critical imports, potentially resulting in wide-ranging economic consequences.

Following Trump's announcement, Canada’s Stelco informed its US customers that it is temporarily suspending sales quotes. Likewise, Mexican steel suppliers have stopped accepting orders, awaiting clarity on the policy direction, according to Flack Global Metals.

“There is significant uncertainty among Mexican steelmakers regarding their strategy for the US market. They have shifted from concern to confidence and now back to concern. The volatility is unsettling,”  says Jeremy Flack, CEO, Flack Global Metals.

Canada is the largest foreign supplier of steel to the United States, with Mexico ranking third, as per data from the US Commerce Department. In 2023, the US consumed about 91Mt of steel, with imports accounting for 27% of the total demand, according to Morgan Stanley.

Cleveland-Cliffs, the second-largest steel producer in the United States, is preparing to adjust to any changes. “President Trump will do what he sees fit. He has a plan, and I will follow accordingly. We need to put America first,” says Lourenco Goncalves, CEO, Cleveland-Cliffs.