U.S. business associations oppose tariffs on Canadian aluminum

Major U.S. business associations have voiced opposition to the Trump administration's reportedly proposed tariffs on imported aluminum from Canada, which would hurt American manufacturers and undermine the spirit of the U.S.-Mexico-Canada Agreement (USMCA).

"This attempt to re-impose aluminum tariffs on our Canadian neighbors would be a major mistake. It would completely undermine the spirit of our newly-negotiated USMCA and would reignite trade tensions with our biggest trading partner," National Foreign Trade Council (NFTC) President Rufus Yerxa said Wednesday in a statement.

"It will also hurt the most dynamic U.S. manufacturers in sectors like autos, food products and construction, all in a vain effort to prop up inefficient domestic aluminum producers by branding Canada a national security threat," he said.

Yerxa warned that American exporters will "undoubtedly face Canadian retaliation" and American consumers will also pay the price if the Trump administration moves forward with new tariffs.

"It would indeed be sad if the administration fails to recognize why such an action a few days before entry into force of USMCA would undermine our credibility as a reliable trading partner, not just with Canada, but with other potential free trade partners like the U.K. and Japan," he said.

Neil Herrington, senior vice president for the Americas Department at the U.S. Chamber of Commerce, also said Tuesday that "bringing back these tariffs would be like a bad horror movie."

"Most of the U.S. aluminum sector opposes them, and they'll hurt American manufacturers who use aluminum as an input. Canada will surely retaliate against U.S. exports. This is the wrong way to mark the entry-into-force of the new North American free-trade agreement on July 1," Herrington said.

The warnings from major business groups came after multiple U.S. media reported on Tuesday that the Trump administration is considering re-imposing tariffs on aluminum imports from Canada later this week.

The U.S. business community has widely opposed the imposition of tariffs on imported steel and aluminum since they were first announced in 2018. After considerable push back from the business community, the Trump administration suspended these tariffs for Mexico and Canada as part of USMCA negotiations in May 2019.

The USMCA is scheduled to enter into force on July 1 after all three countries have completed their domestic procedures to implement the agreement.