What the cement tariff reversal could teach Canada about dealing with Trump

The cement-levy decision shows the Trump administration will reconsider a tariff when U.S. manufacturers demonstrate that it is hurting them. Photo by Zak Bennett/Bloomberg via Getty Images

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The United States dropping its 50 per cent tariff on Canadian cement may offer a lesson for other industries caught in the trade war, with pressure from U.S. businesses hurt by tariffs helping to make the case for relief, according to some observers.

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The Donald Trump administration on Tuesday said it was removing cement and a handful of other products from its tariff list less than three weeks after the levy took effect, even as new tariffs were imposed on other Canadian goods, including motorcycles and dairy products.

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Cement manufacturers and their customers in the U.S. had warned the country does not produce enough cement to meet domestic demand, leaving them reliant on Canadian supply and exposed to higher costs due to the tariff.

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Among those pressing Washington for relief was the National Precast Concrete Association, whose chief executive Nick Rhoad said the organization specifically asked for the cement tariff to be removed and believes its concerns were heard.

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“Yes, I’m very convinced that the message got through to them,” he said. “They have been very willing to listen to our industry and our manufacturers.”

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The association represents nearly 700 precast concrete producers whose products are used in roads, bridges, sewer systems and other infrastructure.

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Rhoad said the association contacted Washington to explain what the tariff would mean for U.S. manufacturers, although he declined to identify who the association specifically spoke to. It also met with the White House earlier this year about the importance of the precast industry.

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Republican Sen. Susan Collins of Maine raised the cement tariff directly with U.S. Trade Representative Jamieson Greer and Commerce Secretary Howard Lutnick, warning that businesses in her state relied on Canadian cement and had few alternatives.

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Carlo Dade, director of international policy and the New North America Initiative at the University of Calgary, said the cement reversal reflects a broader process underway in Washington as the U.S. learns which tariffs it can maintain without inflicting too much damage on its economy.

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“You have a battle within the U.S. between those who benefit from higher tariffs … and industries who are hurt as the price goes up,” he said.

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But U.S. industries hurt by tariffs do not always win that battle.

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Dade pointed to aluminum as a counterexample. The U.S. does not produce enough aluminum to meet domestic demand, leaving its companies dependent on imports and exposed to higher costs from tariffs, yet those tariffs remain.

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Competing interests have always sought to influence U.S. trade policy, he said, but that process has become more troubling under Trump.

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“The corruption involved in the manipulation of trade policy has gone from something quietly tolerated out of necessity, political necessity, to a more blatant manifestation of abuse of power under the Trump administration,” he said.