CCA Warns Proposed 50% Tariff Threatens CASE Supply Chains

USA Canada Trade War and United States — Credit: wildpixel / iStock via Getty Images Plus

Canadian Coatings Association President and CEO Dave Carey is calling for a firm and lasting Canada-U.S. trade agreement, warning that the temporary postponement of a proposed 50% tariff does not give coatings, adhesives, sealants and elastomers companies the predictability they need for long-term decisions.

The United States delayed implementation of the proposed tariffs from Aug. 19 through the end of Aug. 21 while negotiations continued. The Associated Press reported that the three-day pause followed a last-minute agreement to continue negotiations. On Friday, The Wall Street Journal reported that Canadian Trade Minister Dominic LeBlanc said the countries were “very close” to finalizing an agreement after a roughly three-hour meeting with senior Trump administration trade officials. No final agreement had been announced as of Friday afternoon, and without a deal or another extension, the 50% tariffs could take effect as early as Saturday.

PCI previously reported that the planned Canadian tariffs reach several classifications directly connected to coatings and construction materials, including certain nonaqueous paints and varnishes, nonrefractory surfacing preparations and printing inks. Covered products would be subject to the additional duty regardless of whether they otherwise qualified for preferential treatment under the United States-Mexico-Canada Agreement.

CCA posted the following statement from Carey on LinkedIn:

“The Canadian Coatings Association welcomes the news that the United States has agreed to postpone implementation of its proposed 50% tariff on a range of Canadian goods under Section 338 of the U.S. Tariff Act of 1930, delaying the original August 19 deadline to end of day, Friday, August 21.

This additional time for both countries’ negotiators to reach a deal is a positive development, but it does not remove the uncertainty our members have been navigating. Businesses operating in Canada’s coatings, adhesives, sealants and elastomers (CASE) sector cannot confidently make long-term decisions about production, R&D or capital investment while the terms of trade with our largest bilateral market remain unresolved. Simply put, our sector requires the kind of predictability and certainty that can only be achieved through a firm and lasting trade agreement.

Our members operate within deeply integrated North American supply chains that support jobs, investment and innovation in the CASE sector on both sides of the border. New tariffs would put that shared industrial base at risk, raising costs and eroding competitiveness for CASE companies and customers in Canada and the United States alike.

As such, the CCA will continue engaging with governments and industry partners to ensure the voice of Canada’s CASE sector is heard as this situation develops. We remain committed to advocating for the deep, historic and mutually beneficial trade ties between our two countries, which remain a strategic advantage that stakeholders on both sides of the border should work to protect.”

Carey also recently discussed CCA’s broader advocacy, regulatory priorities and industry collaboration in an episode of PCI’s Coat It! podcast.

The proposed tariff reaches coatings-related product classifications and could affect material flows, production planning, costs and investment across tightly integrated Canada-U.S. supply chains. Follow PCI’s regulations coverage for more regulations coverage affecting coatings manufacturers and suppliers.