What happened
The measures affect $20 billion in annual U.S. exports to Canada, roughly 6% of U.S. shipments there last year.
Her comments followed the breakdown of U.S.-Canada trade talks more than a week earlier. On Aug. 22, duties targeting Canadian imports that were imposed by President Donald Trump went into effect, and Prime Minister Mark Carney's government subsequently rolled out the new tariffs. The White House also released an executive order that redesignated Lake Ontario "Lake America," and the U.S. has indicated it could pursue additional punitive steps.
Market effect and prices
Tanners argued the trade conflict has already made U.S.-sourced metals prohibitively expensive to bring into Canada. She said Canadian steel prices have climbed enough that local mills are incentivized to prioritize domestic sales over shipments to the U.S. What's behind the price strength, she noted, is the lagged effect of U.S. tariffs put in place about a year earlier, combined with "better-than-expected" demand. The key uncertainty now is whether prices can stay elevated given seasonal slowdowns, an uptick in imports, and new capacity starting up inside Canada.
"Canada doesn't have that much impact on the US anymore because Canadian prices have already risen," Tanners said.
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What it means for investors
Over the past year, U.S. steel stocks have climbed: the VanEck Steel ETF rose 53% through Friday, outpacing the S&P 500's 19% advance. Tanners struck a comparatively stronger tone on aluminum. She said the aluminum market has been more subdued than steel - prices climbed alongside oil and then eased - but added, "Our view is that aluminum prices will be stronger for longer, and part of that is because of higher energy prices." She also highlighted mounting worries about new capacity additions, especially in Indonesia with Chinese backing. "The aluminum market, we think, is offering even better value in the stocks that we follow than the steel industry."
