WASHINGTON — Canada has unleashed a massive diplomatic initiative to try to head off more Trump-imposed tariffs on its exports and Minnesota is a key part of that strategy.
Warren Kaeding, Saskatchewan’s Minister of Trade and Export Development, made a two-day trip to the state this week as premiers from Canadian provinces descended on Washington, D.C., to make the case to U.S. lawmakers and business leaders that new tariffs would harm both countries.
President Donald Trump imposed 25% tariffs on steel and aluminum imports from all nations Monday.
These will hit Canada very hard. According to the American Iron and Steel Institute, the largest supplier of steel to the United States in 2024 was Canada, followed by Brazil, Mexico, South Korea and Vietnam.
And the clock is ticking on talks to avoid sweeping tariffs on all Canadian and Mexican exports to the U.S., which were delayed for 30 days early this month.
“We were able to escape two weeks ago, but we need to prepare,” Kaeding said of the looming trade war with Canada.
Kaeding told MinnPost he traveled to Minnesota to “tell the Saskatchewan story” and remind the state’s farm and business interests of how integrated the Minnesotan and Canadian economies are and the impact President Donald Trump’s broader tariffs would have on U.S. consumers.
Kaeding said he met with the Minnesota Chamber of Commerce, the Minnesota Farm Bureau Federation and other agricultural and business concerns, including Eden Prairie-based Grain Millers, which imports oats from Saskatchewan, as does General Mills.
Minnesota Farm Bureau President Dan Glessing said he had a “great discussion” with Kaeding “around the importance of agricultural products and trade that are vital to both of our economies.”
“A single crop can cross over the border multiple times from seed to final product, and it’s important to keep these relationships strong and support each other,” Glessing said.
There’s also the import of crude oil from Saskatchewan that is refined in two facilities in Minnesota and turned into gasoline and diesel and jet fuel. “I’m probably going to fly home on oil produced in Saskatchewan,” Kaeding said.
The oil imports from Kaeding’s province to Minnesota were valued at about $2.3 billion in 2023. They would get more expensive if Canada imposed retaliatory tariffs. So would potash-based fertilizer imported from Saskatchewan that’s used by Minnesota corn, soybean and wheat farmers.
Kaeding called Minnesota “a huge trading partner” and the fourth largest state when it comes to importing goods from Canada.
A Canadian “fact sheet” on bilateral agricultural trades said Minnesota exported $1.6 billion in agricultural products to its northern neighbor in 2022, including more than $750 million worth of corn, $185 million in grain alcohol and $38 million in baked goods.
The 51st state?
Kaeding said he also travelled to Minnesota to determine which government officials he should lobby.
Some GOP lawmakers are concerned about the effect Trump’s tariffs on steel and aluminum would have on their home-state industries.
Sen. Rand Paul, R-Kentucky, for instance, argued on a post on X that tariffs are “simply taxes” and said traditionally conservatives have been “united” against any new taxes.
Kaeding said he’s “bewildered” by Trump’s tariff threats.
But Trump seems determined to treat an ally and important trading partner with a certain degree of hostility — and has repeatedly said he’d like to make Canada the 51st state.
“The other thing is, we subsidize them to the tune of about $200 billion a year,” Trump said of Canada in a Super Bowl press conference. “If we stop doing that, we stop allowing them to make cars … and other things, cars, trucks, etc., they make, they’re not viable as a country.”
The United States does not subsidize Canada. But it had a trade deficit of about $72 billion in 2023, largely because of U.S. imports of Canadian energy. Canadian Prime Minister Justin Trudeau said Trump genuinely wants to annex Canada for its natural resources.
Trudeau’s government has readied a list of retaliatory tariffs on a wide range of products made in Canada and exported to the United States that are worth more than $155 billion.
But there are some U.S. companies who will benefit from the imposition of 25% tariffs on steel, including U.S. Steel, whose stock climbed nearly 5% on Monday in expectation of those tariffs.
U.S. Steel owns and operates two taconite plants in Minnesota: Minntac in Mountain Iron and Keetac in Keewatin. U.S. Steel also has a minority stake in Hibbing Taconite Company.
The stock of Cleveland-Cliffs, which manages and operates four mines in Minnesota, soared even higher, about 18%.
There will be plenty of losers, too, especially Minnesota manufactures that rely on steel and aluminum imports.
Consumers would also see the prices on many goods increase, from cars and appliances to canned food as the cost of steel and aluminum rise.
For now, Kaeding said he’s taking a “wait and see” approach. “We need to remind everyone … how tariffs hit both sides of the equation,” he said.
Ana Radelat
Ana Radelat is MinnPost’s Washington, D.C. correspondent. You can reach her at aradelat@minnpost.com or follow her on Twitter at @radelat.
The post Minnesota part of Canadian diplomatic push to avoid new Trump tariffs appeared first on MinnPost.
