Ontario Prime Minister Doug Ford said President Donald Trump agreed to suspend a 25% surcharge for electricity imports into the United States after talking to U.S. Secretary of Commerce Howard Lutnick after the threat of raising the country’s steel and aluminum tariffs by 50%.
In a statement published to Lutnick and posted to X, Ford said he and Lutnick will hold a meeting with US trade representatives on Thursday to discuss the update of the US-Canada Free Trade Act ahead of Trump’s voluntary April 2 “mutual tariff deadline.”
“In response, Ontario agreed to suspend a 25% surcharge for electricity exports to Michigan, New York and Minnesota,” Ford said.
In a subsequent remarks at the White House on Tuesday afternoon, Trump said he is currently considering cutting tariffs in Canada. He was asked if he would lower them and he said “probably so.”
If Canada has 50% tariffs in place, “I’ll let you know,” he said.
Major stock indexes that plunged into Trump’s previous tariff threats came to Green when the suspension was announced.
Trump posted on his Truth Social Platform early Tuesday, posting that Ontario puts a 25% tariff on electricity entering the US, with tariffs on steel and aluminum starting Wednesday to 25% to 50% from Wednesday.
Trump added that he has declared “national emergency” in three Ontario provinces, which has led to tariffs being enforced.
Trump also called on Canada to withdraw its dairy obligations, threatening to “significantly increase” tariffs on cars imported into the United States if Canada does not drop “other terrible, long-time tariffs.”
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 has quickly emerged as a target of Trump’s rage during his second presidential term, putting America’s 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 the country’s 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 understand why he continues to attack close friends and allies, but Americans need to speak out,” Ontario’s 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 previously reported that Trump has not yet signed official documents to raise 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 Canadian tariffs on US goods will remain intact until “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. For example, the state side facility of Steelmaker Alcoa will benefit from higher tariffs, but there is 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 residents in the state is likely to be “small.” Minnesota Governor Tim Waltz – Kamala Harris’ 2024 running mate – likewise, he was hoping for a minimal impact on his state.