Federal Government Announces New Measures to Support Steel and Lumber

December 8, 2025

The world is changing rapidly. The United States, the world’s largest economy, is fundamentally reshaping all its trade relationships, causing major disruption and upheaval for Canadians. It is time to transform our economy from one that is reliant on a single trade partner to one that is stronger, more self-sufficient, and resilient to global shocks. That means working with urgency and determination to transform our strategic industries so they can adapt, compete, and win in this new global environment.

Canada’s new government is introducing new measures to help transform the Canadian steel and softwood lumber industries.

Changes include:

Further limit foreign steel imports to ensure that Canadian steel producers have better access to the domestic market

Canada will tighten the tariff rate quota levels for steel products from non-free trade agreement (FTA) partners from 50% to 20% of 2024 levels.

For non-CUSMA partners with which we have an FTA, Canada will reduce tariff rate quota levels for steel products from 100% to 75% of 2024 levels.

Canada will impose a global 25% tariff on targeted imported steel-derivative products such as wind towers, prefabricated buildings, fasteners, and wires.

Canada will also toughen our border measures to combat foreign steel dumping and verify compliance with applicable surtaxes. To do so, we will equip the Canada Border Services Agency with a dedicated steel compliance team, enhanced detection of false declarations, and an expanded online reporting tool.

To move away from relying on imported steel and to give Canadian companies time to adjust their supply chains to use Canadian steel, the temporary remission of Canadian tariffs on imports will end on January 31, 2026, for steel used in Canada for manufacturing, food and beverage packaging, and agricultural production.

These measures will boost the competitiveness of Canadian steel producers by protecting them against trade diversion. They will also unlock over $1 billion in new domestic demand for Canadian steel.

Make it easier to build with Canadian steel and Canadian lumber

To make it more affordable to transport Canadian steel and lumber across the country, Canada will work with railway companies to cut freight rates for transporting Canadian steel and lumber interprovincially by 50%, beginning in Spring 2026.

To maximise the use of Canadian softwood lumber in housing, Build Canada Homes will prioritise shovel-ready, multi-year projects that can begin within 12 months and that use Canadian wood products.

With a funding allocation of roughly $700 million next year, Build Canada Homes – our new federal homebuilding agency – alone will create $70 to $140 million of new demand for Canadian wood products – and attract private and provincial capital to multiply its impact.

Finally, Canada’s new government will implement our Buy Canadian Policy later this year, which requires that all contracts worth over $25 million prioritise Canadian materials – including steel and lumber. This will also apply across federal grants and contributions programs.

Increase protections for Canadian steel and lumber workers and businesses so they can adapt and thrive in this new global landscape

Canada will earmark more than $100 million over two years, starting in 2025-2026, in program costs to provide support to eligible employers in all sectors with an active Work-Sharing agreement and who commit to supporting training for employees working reduced hours. This measure will increase the income replacement for eligible workers, helping up to 26,000 Canadian workers in various sectors, including steel and lumber.

To ensure companies have the financing and credit support they need to maintain and restructure their operations during this period of transformation, Canada will provide an additional $500 million to the Business Development Bank of Canada (BDC) Softwood Lumber Guarantee Program.

To support softwood lumber firms facing liquidity pressures, Canada will earmark $500 million in funding under the Large Enterprise Tariff Loan facility.

To make it easier for the forestry sector to access federal support, we will establish a single window to applications – a one-stop shop to help companies navigate our suite of support programs.

To examine and report on how the forest industry can maintain its competitiveness over the long-term, Canada will launch a Canadian Forest Sector Transformation Task Force. This Task Force will seek input and recommendations from provinces, territories, and industry on managing the sector’s transformation.

At this critical moment in Canada’s history, we are moving from reliance to resilience. Using Canadian steel and Canadian lumber, we will build Canada strong.

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