Canada, Mexico steelmakers refuse new U.S. orders
Stelco has been telling U.S.-based consumers it is pausing sales quotes
Some steelmakers in Canada and Mexico are telling customers that they are refusing new orders to the United States on concerns that President Donald Trump soon will reimpose duties.
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Canada’s Stelco Holdings Inc. has been telling U.S.-based consumers it is pausing sales quotes, according to a person familiar with the matter. Mexico-based steel suppliers also stopped taking orders for material this week as they await potential action from Trump, according to Flack Global Metals, a large buyer.
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Trump this week signalled plans to impose previously threatened tariffs of as much as 25 per cent on Mexico and Canada by Feb. 1. While the two countries are exempt from a sweeping 25 per cent steel tariff the U.S. imposed during the first Trump administration, there’s increasing concern in the industry that the metal won’t receive a carve out.
“There’s a lot of trepidation and changing commercial policy by the Mexican steelmakers with regards to their approach to this market,” Jeremy Flack, chief executive of Arizona-based steel distributor Flack Global Metals, said. “They’re off balance because of this. They’ve gone from concerned to unconcerned to concerned again.”
Canada is the top foreign import source of steel into the U.S. and Mexico is the third largest, according to U.S. Commerce Department data. The U.S. consumed about 91 million tons of steel in 2023, with imports accounting for about 27 per cent of that total demand, according to research by Morgan Stanley.
Stelco parent Cleveland-Cliffs Inc., based in the U.S., didn’t immediately respond to requests for comment.
Cleveland-Cliffs, the second-largest U.S. steel producer, agreed to buy Canada-based Stelco last year. When asked last week at a briefing about the possibility that Trump would slap tariffs on the company’s newly owned Canadian steel, CEO Lourenco Goncalves said he will abide by Trump’s policies.
“President Trump will do what President Trump wants to do. He has a plan, and I will play accordingly,” Goncalves said. “I’m a big boy. I bought Stelco knowing that Stelco is in Canada. And you know what? America first.”
Bloomberg.com
