If the Trump administration buys the argument that Canadian aluminum exports have surged and slaps a 10 per cent tariff back on products imported from Canada, the move could end up hurting Americans instead, warns the head of the association representing Canada’s aluminum producers.
“Canada stands to win more in a situation like this,” said Jean Simard, the president and CEO of the Aluminum Association of Canada.
“Production will keep going on, exports will keep going on, and at the end, unfortunately, it’s the U.S. economy that will bear the brunt of this increase in tariffs.”
The damage, Simard said, will be more on the political side, given how much political capital the Trudeau government spent on persuading the U.S. government to lift steel and aluminum tariffs in May 2019.
Last week, U.S. Trade Representative Robert Lighthizer fuelled D.C. rumours of a possible return to tariffs by telling the Senate Finance Committee that a recent spike in imports is a “genuine concern.”
Followers of Canada’s long-running battle with the U.S. softwood lumber industry have seen this drama play out before.
As with softwood, the U.S. needs imported aluminum to meet its domestic demand.
Tariffs or no tariffs, the U.S. consumes up to six million tonnes of aluminum every year. But its struggling domestic industry produces only 800,000 tonnes of that.
These bandits would tax their own military to buy the votes of morons …– Flavio Volpe, Automotive Parts Manufacturers Association
Now, some players in the U.S. aluminum industry (but not all of them) are leveraging their political influence to gain a price advantage over foreign competition.
Why does this lobbying work? Well, there’s an election coming in November. And the Trump administration draws a straight line between protecting jobs and winning votes.
How the ‘snap back’ works
When the previous round of American steel and aluminum tariffs ended, the joint statement issued by Canada and the U.S. laid out conditions under which tariffs could “snap back,” or re-apply.
“In the event that imports of aluminum or steel products surge meaningfully beyond historic volumes of trade over a period of time,” the statement said (without defining a “meaningful surge” or what that time comparison should be), “with consideration of market share” (again, this ideal share is undefined) “the importing country may request consultations with the exporting country.”
A formal consultation process hasn’t been publicly requested, agreed to or even disclosed. The Canadian side says regular conversations with the Americans about monitoring aluminum shipments have been underway for several weeks; one such conversation involved Canada’s ambassador in Washington last Friday.
“After such consultations, the importing party may impose duties of 25 per cent for steel and 10 per cent for aluminum in respect to the individual product(s) where the surge took place,” the 2019 statement continued. “If the importing party takes such action, the exporting country agrees to retaliate only in the affected sector.”
In other words, no politically-damaging Canadian tariffs on Kentucky bourbon or Florida orange juice next time.
Searching for a surge
All the U.S. lobby needed to reignite this tariff heat was evidence it could spin as a “surge.” In the volatile market conditions of this past year, American protectionism saw its opening.
American manufacturers, including its defence and aerospace industry, have relied for decades on Canadian aluminum from factories like this one in Sept-Iles, Que. (Jacques Boissinot/The Canadian Press)
First came last fall’s rail strikes and last winter’s protest blockades, disrupting the regular flow of aluminum shipments into fits and starts. Then the COVID-19 pandemic hit, shutting down North American automotive production.
Smelters can’t stop production just because their contracts for value-added alloyed steel products are on hold for a few months. The massive costs and environmental risks aren’t worth it.
So earlier this year, Canadian producers pivoted temporarily to primary aluminum ingots — a basic commodity that can be stored in a warehouse until the market picks up, at which point it can be melted into something specific.
This “P1020” aluminum is the focus of the data now being spun around Washington. It’s a commodity that directly competes with output from older and less-efficient American facilities.
‘False’ and ‘unfounded’
Canada rejects the idea of voluntarily restricting production to satisfy American demands. (It’s also not really proper for publicly-traded corporations to do.)
This unwillingness to go along with voluntary export quotas is what sparked the latest tariff threats: higher prices discourage imports by another means.
Simard said the total volume of aluminum coming out of Canada hasn’t changed significantly — only the type of product has changed, for reasons that are entirely short-term and related to the pandemic.
Allegations of a threatening surge are “totally false” and “unfounded,” he said.
“It’s purely market dynamics,” he said, adding that the same substitutions happened during the last financial crisis in 2008-09.
“Everybody is doing this. It’s the only way to keep plants operating and keep the link with the market,” he said. “The problem is caused directly and certainly by COVID. It’s a matter of months for the situation to correct itself.”
An ‘extortion syndicate’
A decision by the Trump administration to reapply the tariff would be curiously timed.
In the new North American trade agreement that takes effect July 1, the Trump administration specifically negotiated requirements for the automotive industry to use more North American steel and aluminum, in an effort to shut out offshore suppliers and repatriate jobs.
Canadian aluminum is geographically convenient and produced in cost-efficient mills, so in theory, the new NAFTA should be a growth opportunity.
But depending on whether a new tariff is applied specifically to P1020 aluminum or across the board — hitting value-added automotive inputs as well — the Trump administration could be taxing automotive suppliers by an extra ten per cent, just as they’re struggling to recover.
Prime Minister Justin Trudeau met workers at the Alouette aluminum plant last May, championing his government’s agreement with the Trump administration to lift steel and aluminum tariffs. The U.S. is now threatening to slap tariffs back on. (Jacques Boissinot/Canadian Press)
“Canada would be foolish to accept quotas of any sort,” said Jerry Dias, the president of Unifor, the union that represents Canadian auto workers.
“The long-term negative ramifications for Canada would be huge. But it would be equally so for the United States. All it does is gouge the American consumer.”
Flavio Volpe, president of Canada’s Automotive Parts Manufacturers Association, said this apparent hustle to slap tariffs back on before the USMCA takes effect (as early as Friday, according to a report earlier this week from Bloomberg News) is further evidence that “an unprincipled extortion syndicate is in charge of U.S. trade policy.”
“The biggest gangsters wear the cleanest suits,” he said. “Has anyone seen this kind of behaviour by trading partners in the history of the post-industrial world?”
“These bandits would tax their own military to buy the votes of morons in an election year,” Volpe said, referring to the wide use of Canadian aluminum in U.S. defence procurement.
‘No harm … no threat’
Deputy Prime Minister Chrystia Freeland’s office emailed a statement to CBC News Tuesday saying the government “will always defend Canada’s aluminum sector and its workers.”
It characterized the state of play as “ongoing conversations with our American partners.”
Shortly after, Treasury Board President Jean-Yves Duclos told reporters that Canada is keeping its commitment to monitor its aluminum trade and prevent other countries from dumping cheap products into the North American market.
“The use and production of aluminum in Canada is no harm and no threat to our American friends and neighbours,” he said. “The free flow of aluminum across our border is a mutual benefit to both countries and workers in both countries.
“It makes our businesses more competitive, in particular in the automobile industry. It also reduces cost to consumers.”
But what happens if the Americans don’t see it that way?
Should Canada limit its retaliation to what was agreed to in the 2019 statement — and target only U.S. aluminum? Or would all bets be off if the U.S. no longer appeared to be operating in good faith?
During a webinar session hosted by the American Council for Capital Formation, Canada’s ambassador in Washington, Kirsten Hillman, wouldn’t be drawn into a discussion of what form of retaliation Canada might pursue this time if the U.S. re-imposes tariffs.
“Like all aspects of our economy there can be challenges, right now in particular,” she said. “But we firmly believe that Canadian aluminum exports to the U.S. aren’t hurting the U.S. market in any way.”
TORONTO – Will Taylor Swift bring chaos or do we all need to calm down?
It’s a question many Torontonians are asking this week as the city braces for the arrival of Swifties, the massive fan base of one of the world’s biggest pop stars.
Hundreds of thousands are expected to descend on the downtown core for the singer’s six concerts which kick off Thursday at the Rogers Centre and run until Nov. 23.
And while their arrival will be a boon to tourism dollars — the city estimates more than $282 million in economic impact — some worry it could worsen Toronto’s gridlock by clogging streets that already come to a standstill during rush hour.
Swift’s shows are set to collide with sports events at the nearby Scotiabank Arena, including a Raptors game on Friday and a Leafs game on Saturday.
Some residents and local businesses have already adjusted their plans to avoid the area and its planned road closures.
Aahil Dayani says he and some friends intended to throw a birthday bash for one of their pals until they realized it would overlap with the concerts.
“Something as simple as getting together and having dinner is now thrown out the window,” he said.
Dayani says the group rescheduled the gathering for after Swift leaves town. In the meantime, he plans to hunker down at his Toronto residence.
“Her coming into town has kind of changed up my social life,” he added.
“We’re pretty much just not doing anything.”
Max Sinclair, chief executive and founder of A.I. technology firm Ecomtent, suggested his employees avoid the company’s downtown offices on concert days, saying he doesn’t see the point in forcing people to endure potential traffic jams.
“It’s going to be less productive for us, and it’s going to be just a pain for everyone, so it’s easier to avoid it,” Sinclair said.
“We’re a hybrid company, so we can be flexible. It just makes sense.”
Swift’s concerts are the latest pop culture moment to draw attention to Toronto’s notoriously disastrous daily commute.
In June, One Direction singer Niall Horan uploaded a social media video of himself walking through traffic to reach the venue for his concert.
“Traffic’s too bad in Toronto, so we’re walking to the venue,” he wrote in the post.
Toronto Transit Commission spokesperson Stuart Green says the public agency has been working for more than a year on plans to ease the pressure of so many Swifties in one confined area.
“We are preparing for something that would be akin to maybe the Beatles coming in the ‘60s,” he said.
Dozens of buses and streetcars have been added to transit routes around the stadium, and the TTC has consulted the city on potential emergency scenarios.
Green will be part of a command centre operated by the City of Toronto and staffed by Toronto police leaders, emergency services and others who have handled massive gatherings including the Raptors’ NBA championship parade in 2019.
“There may be some who will say we’re over-preparing, and that’s fair,” Green said.
“But we know based on what’s happened in other places, better to be over-prepared than under-prepared.”
Metrolinx, the agency for Ontario’s GO Transit system, has also added extra trips and extended hours in some regions to accommodate fans looking to travel home.
A day before Swift’s first performance, the city began clearing out tents belonging to homeless people near the venue. The city said two people were offered space in a shelter.
“As the area around Rogers Centre is expected to receive a high volume of foot traffic in the coming days, this area has been prioritized for outreach work to ensure the safety of individuals in encampments, other residents, businesses and visitors — as is standard for large-scale events,” city spokesperson Russell Baker said in a statement.
Homeless advocate Diana Chan McNally questioned whether money and optics were behind the measure.
“People (in the area) are already in close proximity to concerts, sports games, and other events that generate massive amounts of traffic — that’s nothing new,” she said in a statement.
“If people were offered and willingly accepted a shelter space, free of coercion, I support that fully — that’s how it should happen.”
This report by The Canadian Press was first published Nov. 13, 2024.
TORONTO – Hundreds of Taylor Swift fans lined up outside the gates of Toronto’s Rogers Centre Wednesday, with hopes of snagging some of the pop star’s merchandise on the eve of the first of her six sold-out shows in the city.
Swift is slated to perform at the venue from Thursday to Saturday, and the following week from Nov. 21 to Nov. 23, with concert merchandise available for sale on some non-show days.
Swifties were all smiles as they left the merch shop, their arms full of sweaters and posters bearing pictures of the star and her Eras Tour logo.
Among them was Zoe Haronitis, 22, who said she waited in line for about two hours to get $300 worth of merchandise, including some apparel for her friends.
Haronitis endured the autumn cold and the hefty price tag even though she hasn’t secured a concert ticket. She said she’s hunting down a resale ticket and plans to spend up to $600.
“I haven’t really budgeted anything,” Haronitis said. “I don’t care how much money I spent. That was kind of my mindset.”
The megastar’s merchandise costs up to $115 for a sweater, and $30 for tote bags and other accessories.
Rachel Renwick, 28, also waited a couple of hours in line for merchandise, but only spent about $70 after learning that a coveted blue sweater and a crewneck had been snatched up by other eager fans before she got to the shop. She had been prepared to spend much more, she said.
“The two prized items sold out. I think a lot more damage would have been done,” Renwick said, adding she’s still determined to buy a sweater at a later date.
Renwick estimated she’s spent about $500 in total on “all-things Eras Tour,” including her concert outfit and merchandise.
The long queue for Swift merch is just a snapshot of what the city will see in the coming days. It’s estimated that up to 500,000 visitors from outside Toronto will be in town during the concert period.
Tens of thousands more are also expected to attend Taylgate’24, an unofficial Swiftie fan event scheduled to be held at the nearby Metro Toronto Convention Centre.
Meanwhile, Destination Toronto has said it anticipates the economic impact of the Eras Tour could grow to $282 million as the money continues to circulate.
But for fans like Haronitis, the experience in Toronto comes down to the Swiftie community. Knowing that Swift is going to be in the city for six shows and seeing hundreds gather just for merchandise is “awesome,” she said.
Even though Haronitis hasn’t officially bought her ticket yet, she said she’s excited to see the megastar.
“It’s literally incredible.”
This report by The Canadian Press was first published Nov. 13, 2024.
OTTAWA – Via Rail is asking for a judicial review on the reasons why Canadian National Railway Co. has imposed speed restrictions on its new passenger trains.
The Crown corporation says it is seeking the review from the Federal Court after many attempts at dialogue with the company did not yield valid reasoning for the change.
It says the restrictions imposed last month are causing daily delays on Via Rail’s Québec City-Windsor corridor, affecting thousands of passengers and damaging Via Rail’s reputation with travellers.
CN says in a statement that it imposed the restrictions at rail crossings given the industry’s experience and known risks associated with similar trains.
The company says Via has asked the courts to weigh in even though Via has agreed to buy the equipment needed to permanently fix the issues.
Via said in October that no incidents at level crossings have been reported in the two years since it put 16 Siemens Venture trains into operation.
This report by The Canadian Press was first published Nov. 13, 2024.
