Back and forth on tariffs - ING

President Donald Trump threatened to increase steel and aluminium tariffs on Canada to 50% in retaliation to Ontario's move to raise taxes on electricity exports to the US, a sign of trade war escalation. However, Trump backed down fairly quickly after Ontario dropped its electricity surcharge, ING's commodity experts Ewa Manthey and Warren Patterson note. 

More price rises are likely in the near term

"Broader tariffs of 25% come into effect today for aluminium and steel imports. Aluminium is likely to be most impacted with the US importing significant volumes of its aluminium from abroad. Canada is the main source of aluminium for US industry, accounting for 58% of imports, US government figures show."

"Canada supplies about 23% of steel imports into the US. Tariffs have seen the US Midwest aluminium premium surge; it's up more than 75% since the beginning of the year. More price rises are likely in the near term."