Canada’s ferrous scrap exports to the US will retain their exemption under the US-Mexico-Canada Agreement (USMCA), despite a sweeping 35% tariff on Canadian imports announced by President Donald Trump. In a formal letter to Canadian Prime Minister Mark Carney, Trump stated the new tariff will take effect on 1 August. However, a White House official confirmed that USMCA-compliant goods—including ferrous scrap metal—will not be subject to the new duty.

The announcement has stirred unease in the market, with uncertainty likely to linger until the tariff is fully implemented. Ferrous scrap metal is a key export from Canada to the US, with shipments centered around shred and #1 busheling grades. In 2024, the US imported an average of 230,000 metric tonnes per month of ferrous scrap overall. Through May, Canadian shipments totaled 1 million tonnes, reflecting a 10% year-over-year decline.

While the exemption offers some relief for scrap traders, industry participants remain cautious about the broader trade implications. The continued flow of USMCA-compliant ferrous scrap is vital for US steelmakers, many of whom rely on Canadian supply to maintain production amid global market volatility.