The China Mail - Trump doubles down on Canada trade war

Trump's shock new threats came hours before a midnight deadline for ramping up the Republican's increasingly global trade offensive.

On his Truth Social platform, Trump announced that he would increase tariffs on Canadian steel and aluminum imports by an additional 25 percent for a total of 50 percent duties on those commodities for the neighbor.

This is in addition to tariffs of 25 percent on steel and aluminum imports from around the world, including exporters in Brazil, Mexico and United Arab Emirates.

The upcoming levies, which currently allow for no exceptions, threaten to hit everything from electronics to vehicles and construction equipment -- and have manufacturers scrambling to find cost-effective domestic suppliers.

The country facing the most aggressive action is Canada, historically one of the United States' closest allies and top trading partners, but now locked in an extraordinarily bitter war of words with the Republican, as well as constant threats over its sovereignty.

Canada's incoming prime minister Mark Carney struck a defiant note Sunday, vowing to stand up for "the Canadian way of life" and saying Canadians are "always ready" for a fight if needed.

Canada supplies half of US aluminum imports and 20 percent of US steel imports, noted industry consultant EY-Parthenon.

Trump said his new supercharged tariffs were in response to Canadian province Ontario's imposition of a 25-percent tax on electricity exports to the United States.

Trump said he would also be announcing an electricity national emergency in the area hit by the price increases.

But he also ramped up his threats, warning that if what he called "egregious" Canadian tariffs are not dropped he will also impose car import tariffs starting April 2 "which will, essentially, permanently shut down the automobile manufacturing business in Canada."

In the same lengthy social media post, Trump said the "only thing which makes sense" is for Canada to join the United States as a 51st state.

"This would make all Tariffs, and everything else, totally disappear. Canadians taxes will be very substantially reduced, they will be more secure, militarily and otherwise, than ever before, there would no longer be a Northern Border problem," Trump said.

- Costs and opportunities -

If some companies are bracing for a damaging period of elevated production costs, others are sensing an opportunity.

Drew Greenblatt, owner of metal product manufacturer Marlin Steel, said the incoming levies on imported steel have already boosted his new orders.

"We only use American steel, so we're thrilled with the tariffs," he told AFP, adding that these helped him gain an edge over a competitor that was using Chinese metal imports.

But producers who use foreign sources of steel have warned that higher import costs will ripple through the world's biggest economy.

Even as some domestic companies stand to benefit as tariffs bring them more business, a major US maker of steel products warned that American steel prices would surge to match the elevated costs of foreign goods.

Supply constraints nudge prices higher, making items like nails for example more pricey given that much of their cost comes from original steel.

Purchasers in industries like homebuilding would therefore end up spending more money.

They could end up passing these costs on to consumers, making homes even less affordable, the manufacturer cautioned, speaking on condition of anonymity.

A.Zhang--ThChM