Canada’s choice to strengthen tariff boundaries to guard its home metal trade amid a commerce struggle with america has elevated the chance that a few of Korea’s metal merchandise might be caught within the crossfire. The difficulties are anticipated to persist as this stems from the influence of excessive tariffs imposed by U.S. President Donald Trump concentrating on Canada.
Based on Bloomberg and different overseas media shops, Canadian Prime Minister Mark Carney held a press convention on Nov. 26 (native time) and introduced metal trade safety measures that decrease the standards for making use of metal tariff fee quota (TRQ). TRQ is a system that exempts or applies low tariffs as much as a sure quantity based mostly on a reference 12 months, however imposes excessive tariffs on volumes exceeding this threshold.
Canada has already established TRQ software standards of fifty% for non-trade settlement nations and 100% for commerce settlement signatory nations together with Korea, based mostly on 2024 import volumes, and is imposing 50% excessive tariffs on export merchandise exceeding these thresholds. By way of this measure, the TRQ software standards for commerce settlement signatory nations together with Korea, which has an FTA, has been lowered once more from the present 100% to 75%. Consequently, Korean metal merchandise will face 50% tariffs on volumes exceeding 75% of final 12 months’s export amount. This implies some Korean metal merchandise that had been tariff-free beneath the Korea-Canada FTA will now face 50% excessive tariffs.
Based on the Korea Worldwide Commerce Affiliation (KITA), Korea exported roughly 620,000 tons of metal merchandise price $780 million to Canada final 12 months, making it Korea’s 14th largest metal export vacation spot by quantity. A metal trade insider said, “We might want to look forward to follow-up measures to precisely assess the influence,” including, “Following america, Canada has additionally raised tariff boundaries, making our response much more difficult.”
With each america and Canada increasing metal tariffs, the North American funding plans of POSCO Group and Hyundai Metal have accelerated. Hyundai Metal and POSCO Group have determined to speculate $5.8 billion in Louisiana to construct an built-in electrical arc furnace metal mill. POSCO Holdings can also be identified to be pursuing strategic partnership and fairness funding with Cleveland-Cliffs, one of many largest metal firms in america.
