06/30/2018 16:39 EDT | Updated 06/30/2018 16:40 EDT

Tenaris Algoma Tubes Blames U.S. Tariffs For 40 Job Cuts

They had hired some new employees only months earlier.

An Ontario manufacturer is laying off approximately 40 workers, and says U.S. tariffs are to blame.

Seamless steel pipe manufacturer Tenaris Algoma Tubes is based in Sault Ste. Marie, Ont. Less than a year ago, it hired 50 new workers as they were "cautiously optimistic" about the market, reported SooToday.

That has all fizzled after U.S. President Donald Trump's administration brought in a 25 per cent tariff on Canadian steel on June 1. It has created an "unsustainable market to serve our U.S. customers," said David McHattie, head of Tenaris institutional relations, in a statement to media on Friday. "The market outlook remains uncertain as we continue to understand the full-scale impacts of cross-border tariffs."


McHattie added the company is also feeling "the effect of increased import competition in Canada from countries no longer able to sell in the U.S. due to the Section 232 action on them."

The 40 layoffs come into effect on July 1, the same day as Canada's retaliatory tariffs kick in. Countermeasures include a 25 per cent tariff on U.S. steel and aluminium products, reflecting the U.S. tariffs on similar products from Canada. It also adds a 10 per cent surtax to a few other products including lawn mowers and whiskey.

The Canadian government is also providing $2 billion in aid to industries affected by the U.S. tariffs, and the money will likely be used expand a work-sharing program and improve a corporate innovation fund, Bloomberg reported.

Tom Williams via Getty Images
Sen. Pat Toomey, R-Pa., talks with reporters in the Capitol's Senate subway before the Senate Policy luncheons on June 19, 2018.

The brewing trade war will likely affect people on both sides of the border, a fact that has U.S. Republican Sen. Patrick Toomey "really concerned." His home state of Pennsylvania hosts the headquarters for Heinz and ketchup is one of the items targeted by Canadian tariffs, a point he raised recently with U.S. Commerce Secretary Wilbur Ross.

"I'm really concerned about the retaliation, which hasn't even really started to hit us yet. But it's going to hit the people who make Kraft and Heinz products."

With files from The Canadian Press

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