Whitehorn Capital's Canadian Manufacturing Industry Report presents performance trends and transaction activity observed in this sector in Canada. All financial data has been sourced from YCharts.
Whitehorn's Canadian Manufacturing Industry Report consists of Canadian companies active in Materials Conversion & Packaging, Industrial & Agricultural Equipment, Consumer Products, Transportation Equipment, and Building Materials.
If you run a manufacturing business in Canada, you may be paying a bigger tariff on the steel you buy than your competitors pay on the finished parts they ship in. Here is how that happens, and what it means for your shop.
Percent added to the item's cost at the border
Rates as of September 2026. Canada charges only one steel surtax per product, so these do not stack. Some finished steel goods from the U.S. are also on Canada's September 8 list and pay more than 25%. Check the rate for your own product.
On separate occasions, we talked about tariffs with the owners of privately held machining shops in Alberta, Ontario and Saskatchewan. All three were frustrated with the current rules, and all three asked a version of the same question. Why pay a tariff on raw steel brought into Canada, when a finished steel part made offshore can come in for less, or for nothing?
At Whitehorn Capital, we dug into the rules to find out. If you buy steel and sell what you make from it, here is what we found.
Each step made sense on its own. Put together, they hit the steel your shop buys the hardest.
Red dots raised costs for Canadian manufacturers. Orange dots gave some relief.
Canada adds a 25% tariff on $12.6 billion of U.S. steel.
Canada limits steel from overseas. Steel over the limit pays a 50% tariff.
Canada drops most tariffs on U.S. goods. The steel tariff stays.
First 25% tariff on some finished steel products. Overseas steel limits get tighter.
The tariff break for manufacturers ended Jan. 31. You now pay the full tariff on U.S. steel.
Ottawa waives the tariff on more U.S. steel that Canada doesn't make.
Canada matches U.S. tariffs on $27.6 billion of U.S. goods. Steel is on that list at 50%.
From June to December 2025, Canada put limits on raw steel from overseas, while most finished steel products faced no new tariff at all. Then in December, Ottawa tightened those limits further, narrowing where you can buy without paying a penalty.
The limit is a share of what each country shipped to Canada in 2024
What this means when you buy: if a country without a trade deal shipped 100 tonnes of steel to Canada in 2024, only 20 tonnes now come in at the normal rate. Once that is used up, your order pays a 50% tariff.
These limits apply to raw steel from overseas. Raw steel from the U.S. and Mexico has no volume limit at all. Instead, U.S. raw steel pays Canada's tariff on every tonne. Mexican raw steel pays no tariff and has no limit.
Same finished part. Same Canadian buyer. Two very different tariff bills, and only one of them lands on you.
Finished steel goods on Ottawa's lists, such as fasteners and building parts, do pay. Parts outside the lists, including many machined components, come in free.
Sell that same part to a U.S. customer instead, and you get hit a second time. The U.S. charges its own tariffs at its border, up to 50% on steel goods. That is the double squeeze owners keep describing to us. A tariff on the steel coming in, and a tariff on the product going out.
Three privately held Canadian manufacturers, in their own words. You will likely recognize the problem.
Saskatoon. Mining equipment.
Bit Service buys more raw steel from the U.S. than the company sells back into the U.S. So Canada's tariffs cost Bit Service more than the U.S. tariffs do.
Management spent two weeks stocking up on American steel before the September 2026 tariff increase.
Scott Bahr, CEO
Global News, Sept. 2026
Winnipeg. Steel wire parts for ice rinks.
U.S. tariffs raise the price of Hunter Wire's rink products for its American customers. The company also has no choice but to buy some of its steel from the U.S., so it now pays Canada's tariff on that steel too.
The president's first choice for government help would be no Canadian tariff on that steel at all.
David Koss, president
CBC News, Aug. 2026
Tillsonburg. Pipe parts.
Wellmaster needs a specialty steel that no Canadian mill makes. The company still had to pay Canada's tariff on it, a tariff meant to push buyers toward Canadian steel that doesn't exist here.
After Wellmaster and industry groups pushed for a fix, Ottawa waived the tariff on more of these steel types in June 2026.
James White, CEO
The Logic, May 2026
You can ask Ottawa to waive the tariff on steel you can't buy in Canada. By spring 2026, most of those requests were still waiting for an answer.
Requests to Finance Canada, March 2025 to April 2026
requests filed in about a year. Before the trade war, Finance Canada got only a handful a year.
Ottawa widened relief for some steel in June 2026. That helps, but you still have to apply and wait. It is worth checking whether your grades are now covered.
Far more Canadians work in businesses like yours than in the mills that make the steel.
Number of workers
Steel jobs: Canadian Steel Producers Association. Metal parts and products: Prime Minister's Office backgrounder, November 2025.
Share of companies saying each set of tariffs hurt them a lot
Canadian Construction Association, Winter 2026 Economic Insights report.
When steel costs more to bring in than finished parts, the rules protect the steel mill and squeeze the business that turns steel into products. Owner-operated shops feel it first, because they have the least room to absorb it.
This part is our opinion. We believe Canada can back its steel mills and its private manufacturers at the same time, and that these five changes would go a long way. If they match what you are seeing in your own business, they are worth raising with your MP and your industry association.
A few questions we would be asking if we ran a shop that buys steel today.
Notable Canadian manufacturing transactions this past quarter.
| Date | Acquirer | Acquirer HQ | Target | Target HQ |
|---|---|---|---|---|
| Apr. 2026 | Metrie | Vancouver, BC | Certain assets of Northstar/TruBilt Doors | St. Thomas, ON |
| Acquisition of door fabrication, hanging and finishing assets in Eastern Canada from division of Cornerstone Building Brands to expand door manufacturing and service capabilities. | ||||
| Apr. 2026 | PFM Capital and BDC Growth Equity Partners | Canada | West Coast Machinery | Langley, BC |
| Acquisition of manufacturer and distributor of custom service truck bodies and hydraulic excavator attachments via Work Truck West and ShearForce Equipment. | ||||
| May 2026 | Maverick Aviation Group | Sherwood Park, AB | Genaire | Niagara, ON |
| Acquisition of aerospace engineering and manufacturing company specializing in aircraft fuel systems, ground support equipment and OEM to expand national footprint and technical capabilities. | ||||
| June 2026 | Decisive Dividend (TSXV:DE) | Kelowna, BC | Be Fire | Belgium |
| $19.9MM acquisition of specialty hearth manufacturer of wood-burning stoves, fireplaces, and fireplace inserts as add-on to its hearth vertical. | ||||
| June 2026 | Canfor (TSX:CFP) | Vancouver, BC | CanPinkwood's I-joist business | Calgary, AB |
| $8MM acquisition of engineered wood joists manufacturer for residential, multi-family, and commercial construction. | ||||
| June 2026 | Buhler Versatile | Winnipeg, MB | ATLAS Group | Germany |
| Acquisition of German construction machinery manufacturer to strengthen European market position. | ||||
| June 2026 | TerraVest Industries (TSX:TVK) | Toronto, ON | Jet Peinture Plus | Quebec City, QC |
| Acquisition of company specializing in propane tank refurbishment and tank recertification. | ||||
| June 2026 | Ballard Power Systems (TSX:BLDP) | Vancouver, BC | GeoPura | United Kingdom |
| £301MM acquisition of zero-emission hydrogen-based power solutions provider to increase end-to-end capabilities. | ||||
Check out more transactions on our website.
| Subsector | Q2 2026 | Q1 2026 |
|---|---|---|
| Rubber & Plastics | 6 | 3 |
| Fabricated Metals, Milling & Building Products | 6 | 10 |
| Industrial & Commercial Machinery | 11 | 9 |
| Transportation Equipment | 16 | 9 |
| Miscellaneous Manufacturing | 28 | 21 |
| Total | 67 | 52 |
Whitehorn Capital provides sale of business, financing, and merger & acquisition services to Western Canadian private manufacturing companies. To discuss this quarter's findings, reach our team below.
All financial data has been sourced from LSEG Workspace. This report is prepared by Whitehorn Capital Inc. for informational purposes only and does not constitute investment, legal, or tax advice. Figures may include forecasts and are subject to change without notice.
Sale of business, merger & acquisition, and financing advisory for Western Canadian business owners navigating growth, transition, and succession. Helping clients achieve their transaction objectives since 2008.
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Calgary, AB T2T 6S1
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