Ontario Premier Doug Ford said Tuesday that he agreed to suspend a 25% surcharge on electricity imports into the United States after talking to U.S. Secretary of Commerce Howard Lutnick in the wake of President Donald Trump’s threat to raise steel and aluminum tariffs in Canada to 50%.
In a statement issued to Lutnick and posted to X, Ford said he and Lutnick will meet with US trade representatives on Thursday to discuss the update of the US-Canada Free Trade Act before the April 2 “mutual tariff deadline” imposed voluntarily by Trump.
“In response, Ontario agreed to suspend a 25% surcharge for electricity exports to Michigan, New York and Minnesota,” Ford said.
In a subsequent statement at the White House, Trump said Tuesday afternoon that he was considering cutting tariffs in Canada. He asked if they would lower them, he said, “Probably so.”
“We’ll let you know,” he said, whether Canada has 50% tariffs in place.
Major stock indexes that plunged into Trump’s previous tariff threats came to Green when the suspension was announced.
Trump posted on True Social Tuesday that steel and aluminum tariffs will go from 25% to 50% from Wednesday, in response to Ontario’s 25% tariffs on electricity exported to the US.
Trump added that he would declare a “national emergency” targeted by Ontario to ensure tariffs are enforced.
Trump also called on Canada to withdraw its U.S. dairy obligations and threatened to “severely increase” tariffs on vehicles imported into the U.S. if Canada does not drop “other terrible, long hours.”
Automotive tariffs warned without citing evidence, “we will permanently close Canadian car manufacturing.”
Trump has since doubled some of his recent rhetoric about making Canada a part of the United States, but added that he can maintain the national anthem.
“The only thing that makes sense is that Canada will become our precious 50 first states,” Trump wrote. “This creates all the tariffs and everything else disappears for good.”
Canada is quickly appearing as a target of Trump’s rage in his second presidential term, putting US closest allies on rocky scaffolding. Earlier this month, Trump acquired tariffs on various Canadian goods when he introduced, pulled back, ran through leaders and condemned fentanyl’s lack of action against human trafficking. (Compared to the US border with Mexico, relatively few drugs are seized at the northern border).
In another truthful social post late Monday, Trump called Canada a longtime “tax abuser.”
“The US will not subsidize Canada anymore,” he warned, “We don’t need your car, don’t need your wood, don’t do your energy, and soon you’ll find it.”
Mexico faces similar tariff threats and rhetoric, but its president, Claudia Sinbaum, has managed to soften Trump.
This strategy is not working for Canadian officials who are more aggressively retaliated with tariffs and public comments.
“I don’t really know why he continues to attack close friends and allies, but Americans need to speak out,” Ford appeared on CNBC on Tuesday. “We need these CEOs to actually get the backbone and stand in front of them and tell them this is going to be a disaster. It’s a massive mess right now.”
CNBC had reported that Trump has not yet signed official documents to increase tariffs to 50%.
Newly appointed Canadian Prime Minister Mark Carney has since called Trump the threat “an attack on Canadian workers, families and businesses.”
“My government ensures that our response will have the greatest impact on the US and ensure minimal impact in Canada, but the impact of workers has been affected,” Carney said.
He said that Canadian tariffs on US goods “until Americans show respect for us and make a reliable and reliable commitment to free and fair dealing.”
Analysts at Morgan Stanley warned that tariffs could lead to rising domestic prices as the US is a net importer of Canada’s steel and aluminum. As an example, Steelmaker Alcoa’s state facilities will benefit from higher tariffs, but have an even greater presence north of the border.
“We expect a net negative impact on the company as a whole,” the analyst wrote.
Some investors opposed, and on Tuesday it surpassed the Pennsylvania-based company’s shares by 2%.
The New York Independent Systems operator, who manages the state’s grid, said it had enough generation capabilities to move away from Canadian sources.
A spokesman for the Michigan Public Services Commission told The Associated Press on Monday that the impact on state residents is likely to be “small.” Minnesota Governor Tim Waltz – Kamala Harris ‘2024 Running Mate – Similarly, he was hoping for a minimal impact on his state.
