U.S. reverses extra 25% tariffs on Canadian steel, aluminum

The United States on Tuesday reversed its plan to impose extra 25 percent tariffs on Canadian steel and aluminum, after the Canadian province of Ontario dropped tariffs on electricity exports to three U.S. states.

"After President Trump threatened to use his executive powers to retaliate with a colossal 50 percent tariff against Canada, Ontario Premier Doug Ford spoke with (Commerce) Secretary (Howard) Lutnick to convey that he is backing down on implementing a 25 percent charge on electricity exports to the United States," White House spokesman Kush Desai said in a statement.

Earlier on Tuesday, U.S. President Donald Trump said on social media that he would impose an additional 25 percent tariff on steel and aluminum from Canada, raising the total tariff to 50 percent, in response to tariffs on electricity exports from the Canadian province of Ontario.

Shortly after, Ontario agreed to suspend its 25 percent surcharge on electricity exports to three U.S. states.

According to a joint statement from Ontario Premier Doug Ford and U.S. Secretary of Commerce Howard Lutnick, Ford will travel to Washington on Thursday to meet with Lutnick and discuss "a renewed USMCA ahead of the April 2 reciprocal tariff deadline."

Previously, Trump announced the imposition of a broad 25 percent tariff on Canada and Mexico, which took effect on March 4. However, just two days later, Trump reversed his position and adjusted the tariff measures, exempting goods that meet the "United States-Mexico-Canada Agreement" (USMCA) preferential conditions from the tariffs, effective until April 2.

According to NBC News, a senior U.S. government official estimated that about 38 percent of goods imported from Canada to the United States qualify for the exemption.

On March 4, the Canadian government announced that it would implement a 25 percent tariff on U.S. goods worth 155 billion Canadian dollars (about $107 billion) in phases, with the first round of tariffs on goods worth 30 billion Canadian dollars already in effect.

In retaliation to the broad tariffs on Canadian goods, Canada's Ontario government on Monday officially applied a 25 percent surcharge on all electricity exports to three U.S. states: Michigan, Minnesota and New York.

Desai also said in the statement that pursuant to Trump's previous executive orders, a 25 percent tariff on steel and aluminum "with no exceptions or exemptions" will go into effect for all trading partners at midnight, March 12.

On February 10, Trump signed proclamations to raise tariffs on aluminum from 10 percent to 25 percent, aligning them with the existing tariff rate for steel. He also decided to eliminate duty-free quotas, exemptions and exclusions for steel and aluminum tariffs.