Trump exempts Canadian metals from tariffs despite 'don't need Canada' claim

Ontario premier threatens nickel cutoff as Canada weighs mineral leverage

President Donald Trump’s administration exempted almost all Canadian metals from new 50 percent import tariffs, according to Vince Beiser in The Guardian, even as Trump maintained publicly that the United States does not need Canada. Canada is the largest foreign source of minerals for the United States, supplying about $47 billion worth annually, with roughly 60 percent of US aluminum imports originating there. Canadian smelting plants, powered by cheap, low-carbon electricity generated by mighty, remote rivers, produce much of that aluminum, Beiser reported.

The exemptions reflect US dependence on Canadian-sourced metals for military, energy, and agricultural uses. The US military uses Canadian aluminum for shell casings, ship hulls, and aircraft fuselages; the F-35 fighter jet’s airframe is composed of about 40 percent aluminum, according to Beiser. Trump himself acknowledged the dependence last month, saying: “This country desperately needs aluminum… We get it all from Canada for the most part, and we need it badly.”

Ontario Premier Doug Ford threatened last month to cut off nickel exports if trade tensions escalate further, Beiser reported. The US obtains about half of its nickel supply from Canada, and the metal is a vital ingredient in the steel alloys used in jet engines and in armor plating for vehicles and ships, according to Beiser’s reporting. The US has only one operating nickel mine and no refineries, so the raw ore from that mine is shipped to Canada for refining and then sold back to US companies, Beiser reported.

The premier of British Columbia has suggested his province could ban exports of germanium to the United States. Germanium is used in night-vision goggles, laser rangefinders, solar panels, and fiber optics. The US faces limited alternatives: China, which produces the bulk of the world’s germanium, has already largely stopped selling the metal to the United States, Beiser reported.

China has also restricted gallium exports to the United States, an ingredient in high-performance computer chips used in missile defense and radar systems, according to Beiser. The US does not produce any primary gallium. A new gallium plant is slated to open in Canada next year, Beiser reported.

Canadian minerals also undergird US civilian infrastructure beyond military applications. Canada supplies US nuclear reactors with much of the uranium used to generate nearly a fifth of the country’s electricity, Beiser reported. Almost 90 percent of the potash that US farmers apply to their fields comes from Canada, according to Beiser; peat, another agricultural input, follows a similar pattern.

US alternatives to Canadian supply remain limited, according to Beiser. The US has deposits of many of these minerals and is working to rebuild its once-mighty domestic critical metal industries, but securing financing and regulatory approvals for new mines takes years, and US production is often more expensive than Canadian output.

Turning to non-Canadian foreign suppliers would require a hugely expensive project of unravelling cross-border supply chains that have been built up over decades and support countless US jobs, and rebuilding them to more distant countries, Beiser reported. Russia, the US’s second-largest source of potash, is not a trading partner most countries would choose to rely on, Beiser noted. China, the world’s biggest producer of most of the critical metals the US needs, is also the United States’ biggest rival — which is precisely why the US has for the last several years been pushing to build up a supply chain of critical metals that isn’t under Beijing’s control, Beiser reported.

The precedent of Chinese export restrictions has shaped Canadian leverage in the trade dispute, according to Beiser. When Trump threatened China with tariffs last year, Beijing responded by threatening to ban exports of rare earths and the magnets and other products made from them; the United States subsequently backed down, Beiser reported. Canadian provincial leaders have taken note. “Everything’s on the table,” Ford said recently, according to The Guardian.