Trump proposes duty-free trade with Canada in exchange for sovereignty, BTC falls below $80K

President Donald Trump has announced a 50% tariff on the import of Canadian steel and aluminum, combining a 25% duty on metals with a 25% overall tariff on all Canadian goods, which will take effect on March 12, 2025. This step exacerbates the trade dispute focused on Canada's 'anti-American farm tariffs', which amount to up to 390% on US dairy products, which Trump has called 'outrageous' and demanded that Ottawa immediately revoke them.
Trade tensions are escalating: tariffs on steel and aluminum are rising as the dispute between the U.S. and Canada continues.
The tariff on steel and aluminum aims to protect the US industry and address trade imbalances, according to the White House. A 25% duty on metal imports corresponds to a broader trade strategy of Trump's, while an additional 25% general tariff - linked to the declaration of a national emergency on drugs and immigration - creates a combined 50% tariff for the export of Canadian metals. Canadian Prime Minister Justin Trudeau has condemned these measures as 'unjustified,' promising corresponding actions.
Bitcoin price after the news.
Canada's state tariffs on dairy products, ranging from 250% to 390% on U.S. goods exceeding quotas under the United States-Mexico-Canada Agreement (USMCA), have drawn sharp criticism from Trump. These tariffs, part of Canada's supply management system, are only applied when U.S. exports exceed agreed limits. However, U.S. dairy exports to Canada — worth $1.14 billion in 2024 — typically do not surpass quotas, making high tariffs largely theoretical.
US stock markets after news.
USMCA, designed to expand market access, instead fueled disputes. The U.S. accuses Canada of restricting dairy quotas for American exporters, reserving most of the access for domestic processors. A recent USMCA panel ruled that some Canadian measures are appropriate, but the U.S. continues to push for reforms. Trump's threat of mutual tariffs on Canadian milk and lumber signals a tough stance ahead of potential negotiations.
Donald Trump's post on Truth Social is partial(.
Economists warn that a 50% tariff on metals could disrupt supply in North America, increasing costs for US producers. Canadian steel and aluminum exports to the US reached $35 billion annually before the tariffs were imposed, supporting industries like car manufacturing. Meanwhile, US dairy farmers, though not yet affected by Canada's high tariffs, fear future trade barriers as tensions escalate.
As of March 11, Trump postponed some tariffs on Mexico and Canada until April 2, 2025, but continued pressure on dairy products and steel. The dangerous trade war threatens to destabilize bilateral relations, with Canada defending its policies as 'fair and lawful.' This dispute underscores broader challenges in balancing protectionist programs with integrated North American markets.
"The only thing that makes sense is for Canada to become our favorite Fifty-First State, Trump said. This will make all tariffs and everything else absolutely unnecessary, he added. Following Trump's statement, all major U.S. stock indices fell against the U.S. dollar, and bitcoin )BTC( dropped below the $80,000 mark, currently trading at $79,506 per coin.