The federal government announced on Monday another package to prop up the hard-hit steel, aluminum and copper sectors after U.S. President Donald Trump tightened his tariff regime to apply to more products, hammering Canadian industry.

At a plant in Vars, a rural community on the edge of Ottawa, Industry Minister Melanie Joly said the government will establish a $1-billion loan program through the Business Development Bank of Canada (BDC) so companies most affected by the Trump scheme can get the money they need to stay in business. That cash will be available on “favourable terms” for at least the next three years, she said.

There will be a separate $500-million fund that gives money to companies making what the government calls “strategic pivots,” as the U.S. market for some of these products becomes increasingly untenable.

“When markets turn unfair, Canada needs institutions that can step up and deliver fast. BDC is ready to get this money into the operations of steel and aluminum companies quickly, keeping their doors open and them producing,” said Isabelle Hudon, the president and CEO of the Crown corporation.

These measures follow other government manoeuvres to save sectors grappling with Trump’s so-called 232 tariffs on industrial products — levies the Canadian government is trying to negotiate away as part of the CUSMA review talks.

The government has already imposed tariffs on some Chinese steel to reduce foreign competition and rolled out a $5-billion strategic response fund, among other initiatives.

The government says this new package is needed now because Trump extended the steel, aluminum and copper levies last month to apply to more products, including previously exempt derivatives like steel coils and aluminum sheets. As a result, Canadian tool and mould makers are suddenly facing huge customs bills at the border.

Asked if today’s announcement is a sign Ottawa believes the U.S. tariffs are here to stay, Joly said: “You don’t know. I don’t know. This is not up to us to answer. These decisions will be taken south of the border. But we don’t just sit idle waiting for things to happen — we act,” she said.

WATCH | Canada backing ‘challenged’ steel, aluminum and copper sector with $1.5 billion in tariff supports:

Canada backing ‘challenged’ steel, aluminum and copper sector with $1.5 billion in tariff supports

Evan Solomon, minister responsible for economic development in southern Ontario, and Industry Minister Mélanie Joly announced $1.5 billion of federal support for hard-hit steel, aluminum and copper Canadian industries impacted by U.S. tariffs. ‘We are going to make sure that they have a way to get through the current crisis so they emerge stronger tomorrow,’ Solomon said.

Raquel Dancho, the Conservative industry critic, called the government’s program a “Band-Aid solution” that won’t work over the long term.

What the industry really needs is a tariff deal with Trump, she said.

“Today is an admission that there is no trade deal on the horizon,” Dancho told reporters on Parliament Hill. 

“The Carney government was elected on the sole promise that they would deliver a trade deal, and there’s clearly no deal in sight.”

U.S. Trade Representative Jamieson Greer, Trump’s point person on the trade negotiations with Canada, warned late last month that the administration is wedded to tariffs and things will not go back to how they were.

“The president’s not gonna go back to the old situation where we had no tariffs and we just let foreign goods made by foreign workers come in without any fee,” Greer said.

The Canadian Steel Producers Association welcomed the announcement, saying it will help the sector deal with the “growing impact of the U.S. tariffs on our businesses.”

But it called for Canada to take further tariff action to close the door on imports of foreign steel-derivative products to better protect the domestic market.

“This will offer immediate protection to a wider range of our customers and more closely align with the U.S. measures,” said Catherine Cobden, the association’s president and CEO.

“The situation is evolving and more must be done.”

StatsCan data shows that exports of steel products in particular have effectively collapsed in the wake of the U.S. trade action.

As of last year, the value of these exports — most of which go to the U.S. — was just a third of what it had been before Trump won back the presidency and enacted a protectionist agenda. Sault Ste. Marie, Ont.-based Algoma Steel has laid off hundreds of workers as a result.

Trump’s tariffs are designed to boost U.S. employment in the sector and privilege American products.

But data from the World Steel Association, the international industry body, shows only a modest uptick in stateside production so far. American steel tonnage produced increased by just three per cent in 2025.

According to research from the U.S. Tax Foundation, the section 232 tariffs alone have led to the equivalent of 154,000 lost jobs in the States.