President Donald Trump announced he is raising tariffs on Canadian steel and aluminum to 50% in response to Ontario’s levy on U.S. electricity imports. The new rate takes effect on March 12, doubling a previously planned 25% tariff. Trump’s announcement came one day after Ontario Premier Doug Ford slapped a 25% surcharge on energy exports to the Canadian province’s three U.S. state customers: New York, Michigan and Minnesota.
Ford has also threatened to cut off the exports entirely. The Ontario surcharge was put in place in response to the tariffs Trump has enacted on Canadian products, Ford said. The electricity tariff will be paid by utility providers in the three states, netting the province an estimated $300,000 to $400,000 per day, Ford said during a March 10 press conference, noting that the tariff will add roughly $100 per month to the bills of 1.5 million households and businesses. Ford said decisions to lower, raise, or “shut the electricity off completely” will be contingent upon the actions taken by Trump in the weeks ahead. He also said that the electricity surcharge could impact more than New York, Michigan, and Minnesota because when the three states have a surplus, they sell it to neighboring states like Ohio or Pennsylvania. Ford said he has spoken with the governors in the states impacted by the electricity tariff to apologize for the measure the province has put in place.
Canada’s dollar weakened after the Truth Social post.
Trump also said he will shortly be declaring a National Emergency on Electricity “within the threatened area,” saying “this will allow the U.S to quickly do what has to be done to alleviate this abusive threat from Canada.”
Trump also warned of further tariff hikes on April 2 if Canada does not remove tariffs on U.S. dairy and other goods. “If other egregious, long time Tariffs are not likewise dropped by Canada, I will substantially increase, on April 2nd, the Tariffs on Cars coming into the U.S. which will, essentially, permanently shut down the automobile manufacturing business in Canada,” Trump wrote.
Trump reiterated his notion that Canada should become part of the United States, saying it would make tariffs go away and make Canada more secure. He framed such an outcome as inevitable: “The artificial line of separation drawn many years ago will finally disappear,” he wrote. Canadian officials first thought this idea was a joke but are now taking the president’s threats seriously.