DETROIT (WXYZ) — The Tariff turmoil has reached a new level, as both Canada and China are taking action against the U.S.
China is imposing higher tariffs on key U.S. farm products, while Ontario, Canada, will begin charging more for electricity set to three states, including Michigan. This all comes as Canada's next Prime Ministrer Mark Carney vows to fight back against President Trump's tariffs.
Trump is also threatening to implement more tariffs on Canada. He says the tariffs are in response to the high tax Canada puts on American Lumber and Dairy to protect it's own industries.
“The US is an important market for Canadian lumber," said Jason Miller, professor of Supply Chain management at Michigan State University. "There's almost a 1 to 1 relationship between US housing starts and the amount of lumber Canada exports as an example to the United States.”
Miller tells me about these looming tariffs on Canada. He said for us here in Michigan, we will be greatly impacted by tariffs on Canadian aluminum and steel.
“So certainly Michigan metal bending industries that consume Canadian metals are going to be seeing prices go up," Miller said. "Not just because of the tariffs, but for example, we've seen the price of Midwest hot rolled steel go from the high 700s to now about $925 per ton just since February and so we're seeing the domestic steel mills raise their prices."
Trump imposed tariffs on all imports from Mexico and Canada on last week. Then the next day, the President announced a one-month reprieve for the auto industry.
By Thursday, he had delayed the tariffs on some other goods for one month. But this weekend, the President told Fox News that the tariffs become reciprocal on April 2.
This is short term, and I felt that for the good of the American carmakers and the UMCA," President Trump said. "I thought it would be a fair thing to do, and so I gave them a little bit of a break for this short period of time."
The President of the United Auto Workers union says he believes the tariffs on Canada and Mexico are an attempt to stop the bleeding.
“This is no single issue in this country that has affected our economy and working class people and their jobs than NAFTA, the U.S. MCA, and our trade laws, our broken trade system, and we're in a crisis mode," said Shawn Fain.
The administration says it is using these tariffs to launch a drug war against Fentanyl coming across our borders, not a trade war with Canada and Mexico.
“As we've watched them make progress on the drug war, then we've relaxed some of the tariffs that we put on them, because they're making progress," said Kevin Hassett, the Director of the National Economic Council of the United States.
Both Canada and Mexico are pushing back on the claims. Mexico says seizures of Fentanyl declined 50 percent between last October and this January, and Canada says less than 1% of the Fentanyl seized in the U.C. comes across the border.
