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THINK ALUMINIUM THINK AL CIRCLE
On behalf of Canada’s primary aluminium industry, the Aluminium Association of Canada (AAC) is pleased to submit the following comments regarding the ongoing review of the United States–Mexico– Canada Agreement (USMCA). Since its entry into force, USMCA has proven to be a cornerstone of North American economic strength and integration. It has enhanced the region’s ability to compete globally, supported cross-border investment, and secured the resilience of critical industrial supply chains that directly benefit US manufacturers and workers.
The AAC represents the country’s primary aluminium producers, Alcoa, Aluminerie Alouette, and Rio Tinto, which together account for 100 per centof Canadian primary production. Canada is the largest supplier of aluminium to the United States, providing over 50 per cent of total US primary aluminium demand and more than 70 per cent of their imports.
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The 2.7 million tons of Canadian aluminium shipped to the US annually require 40 million MWh of energy, the equivalent of at least 4 Hoover dams, or the consumption of 466 data centres. This high-value-added energy export enables the United States (US) to allocate its energy and its investments to more value-added proposals, such as semi and final fabrication of aluminium-based goods, and also to power data centre-backed AI. The metal exported from Canada underpins key US industries such as automotive, construction, aerospace, defence, and energy. For every job in Canada’s primary aluminium sector, approximately thirteen jobs are supported in the US downstream manufacturing economy, from rolling and extrusion to assembly and finished products. As such, the AAC and its members are integral stakeholders in the North American value chain, ensuring the security and competitiveness of US manufacturing through a stable and traceable North American source of supply.
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For the US, the USMCA has ensured a reliable and secure source of essential materials while maintaining market access within a deeply integrated North American production base. For Canada, USMCA has ensured predictable and secure access to its largest export market, providing the confidence required for long-term investment in its competitiveness against non-market-based economy (NMBE) metal from China and Russia. The United States hosts the world’s most advanced aluminium fabrication sector, and its ability to tap into this supply makes it the leading global supplier of high-value aluminium products. This deeply integrated Canada–US connection forms a fundamental pillar of US national security. Since the Agreement’s implementation, billions of dollars have been invested on both sides of the border, both in Canadian smelters as well as in US aluminium processing and manufacturing.
Canada’s primary aluminium producers invest over USD 1 billion annually to modernise and sustain their production facilities, ensuring a reliable and competitive supply for the US market. Canada is the US’s second-largest trading partner and its largest foreign investor with nearly USD 500 billion invested in the US over the past five years. This partnership has delivered tangible results: stronger supply chain resilience and sustained manufacturing employment across the continent.
The Agreement, however, is not without imperfections. It can and should be enhanced to better reflect today’s economic realities: the growing influence of NMBE, the volatility of global trade actions, and the shifting patterns of production and supply chains that define modern commerce. Strengthening the Agreement’s capacity to address these evolving risks will be essential to preserving its relevance and effectiveness for the next decade. The goal should not be to reopen what is working, but rather to reinforce and modernise key provisions of USMCA in order to enhance competitiveness and secure the integrity of North American markets.
1. Canada’s Actions to Strengthen the North American Aluminium Market
Canada recognises that the US has prioritised limiting the inflow of Chinese and Russian aluminium products and investment into North America, strengthening supply chain transparency, and securing access to North American scrap and raw materials. These objectives are essential for protecting US manufacturing competitiveness and preserving the integrity of regional trade. Canada fully shares these objectives and has already implemented a series of measures to achieve them:
2. Why Canada’s Actions are Necessary
These actions have become increasingly necessary given the evolving trade and changing industrial landscape. The comprehensive ban on Russian aluminium is directly linked to Russia’s invasion of Ukraine and follows earlier restrictive measures taken against Russian oligarchs and entities involved in malign economic activities.
With respect to China, Canada faces similar pressures to those experienced by the US China’s aluminium industry has expanded under extensive state subsidies and non-market interventions, allowing it to dominate global production and become, in some cases, the only available supplier for specific semi- fabricated aluminium products. The OECD and other international organisations have extensively documented these structural distortions and their impact on global markets with the support of Canada’s industry.
While Canadian manufacturers traditionally favour US suppliers for downstream products, limited availability of US output in certain segments has occasionally forced importers to source from abroad, despite their preference for North American materials. In particular, flat-rolled products (HTS 7606) have faced growing scarcity in the regional market, creating space for Chinese suppliers to gain share in Canada in recent years, given that Canada does not produce domestically the types of aluminium products typically imported from China.
Recognising this trend, Canada acted in 2024 by imposing a 25 per cent tariff on Chinese aluminium products, alongside similar measures on steel (25 per cent ) and electric vehicles (100 per cent ). This policy aimed both at restoring fair competition and harmonising tariff treatment with US actions targeting Chinese metal, given that Canada does not produce domestically the types of aluminium products typically imported from China.
In parallel, Canada has developed its own Aluminium Import Monitoring System, launched in 2019, requiring importers to declare the origin for all unwrought aluminium entering the Canadian market with high dissuasive penalties for failures to meet reporting requirements, such as jail terms and high financial penalties. This system provides an unparalleled level of visibility into supply chains, enabling authorities to identify potential circumvention of trade measures. Canada could continue to expand the program to cover derivative products, further strengthening its capacity to monitor aluminium inflows.
Complementing AIMS, the Canadian aluminium industry, with support from the federal government, has voluntarily developed and deployed a digital traceability platform. This tool allows producers to digitally authenticate the origin of Canadian primary aluminium from smelter to border.
These actions have proven highly effective: according to Canadian trade data, imports of Chinese aluminium declined by roughly 50 per cent between January and August 2025 and the same period in 2024. Building on this success, Canada introduced this summer an additional 25 per cent tariff on aluminium products containing Chinese-origin metal, determined through the country of smelting and casting declaration. This tariff measure, which is the first of its kind in North America, closes a potential circumvention loophole by targeting indirect trade through intermediary countries. By establishing tariffs based on smelt and cast origin, Canada has reinforced the link between trade policy and traceability, ensuring that non-market- based metal cannot access the North American market through Canada under false pretences.
These measures restore competitiveness to US and Canadian producers, but they also highlight a structural challenge: to maintain a level playing field, US producers must have the capacity to meet total North American demand for key products such as flat-rolled products, Canada may once again be forced to rely on external suppliers.
Integrating these new border tools gives Canadian stakeholders greater oversight and control over potential Chinese influence in the aluminium market. These are concrete, measurable actions taken by the Government of Canada and its industry to defend fair competition. Canada has demonstrated a swift and proactive approach, acting decisively even when such measures involve short-term economic adjustments. This determination reflects the same guiding principles that underpin current US trade policy: prioritising long-term market integrity and national security over immediate convenience.
These initiatives represent an important first step in modernising North America’s trade defence architecture. Continuous improvement remains essential, as no system can be considered perfect in an evolving global trading environment. The Canadian industry remains committed to helping refine these instruments and deepening collaboration with its partners to ensure a resilient, transparent, and fair aluminium market across the continent.
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Note: This article has been issued by the Aluminium Association of Canada and has been published by AL Circle with its original information without any modifications or edits to the core subject/data.
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