Thank you, Mr. Chair and members of the committee. François and I are pleased to join you today to discuss the priorities of Canada's steel industry related to the upcoming budget.

The Canadian Steel Producers Association is very proud to represent 100% of Canada's domestic steel production, as well as significant users of steel in our downstream market. Canada's domestic steel industry generates $15 billion in economic activity and supports 123,000 direct and indirect jobs, from Alberta through to Quebec. Our steel is fully recyclable and supports many other sectors of our economy, such as the automotive sector, the construction sector, the infrastructure sector, the energy sector and the defence sector. We play, as well, an outsized role in the economy of tomorrow, where major clean technologies will require steel.

Despite the strategic importance of our sector, we are facing economic headwinds. It is a tough industry. We struggle to compete due to a prevalence of unfair trade from global overcapacity. We face major decarbonization investments and substantial hurdles to attract that needed capital, along with a lack of available decarbonization solutions. Finally, we face uncertain circumstances in our largest export market, the United States. That economy is taking measures to protect their domestic industry and workforce, particularly in the steel sector, from the same devastating impacts of global overcapacity we face.

In the past several months, we have seen significant support from all political parties for measures that will help Canada's domestic steel sector. These measures have included a steel tariff regime against Chinese steel products, as well as the full implementation of a domestic “country of melt” monitoring requirement on all steel imports that will bring much needed transparency to our supply chain. Incidentally, that “melt and pour” requirement came into effect today. We've also seen significant investment in the Canada Border Services Agency. We're very grateful for these moves. They will indeed help.

However, there's more work to be done. In CSPA's recent submission to this committee, we highlight several items that we believe are crucial in our fight against global overcapacity. They will strengthen our partnership with the United States and ensure our climate transition takes place, while also protecting the competitiveness of our strategic sector.

Some of our recommendations follow.

Number one, further our fight against the destructive forces of overcapacity by improving our anti-circumvention legislation. At the present time, there are legal barriers that prevent us from using this anti-circumvention regime, despite growing concerns about circumvention issues. We urge the government to amend this legislation and take an approach similar to that of the United States.

Number two, update section 53 of the Customs Tariff Act to include labour, environment and national security provisions, improving this tool to reflect the broader range of challenges we face in today's modern world.

Number three, have no doubt that climate is the new trade tool for many nations. Canada must be prepared to respond to detrimental global tariff developments that will affect our steel industry. We believe the best course of action is proactive. Canada should pursue a unified carbon tariff approach with the United States for our sector. Given the integrated nature of the Canadian and U.S. steel industries and our shared climate emissions progress, we believe this unification would be of mutual value on both sides of the border.

Number four, treat vulnerable sectors within Canada's carbon pricing regime differently. As outlined in the important work of Canada's Commission on Carbon Competitiveness, differentiated approaches are justified in order to prevent carbon leakage in Canada's most vulnerable sectors, particularly steel. Based on CSPA members' own analysis, we are seeking a freeze on stringency and price until 2040, in order to allow sufficient time for solutions and a successful transition to the low-carbon economy.

Finally, we should continue to provide support for research, development and the adoption of low-carbon production technologies through tax incentives, through programs and through addressing impediments to clean energy access across the country. We recognize the important partnerships that we have seen in the steel sector to date, notably Algoma and ArcelorMittal Dofasco's announcements. There is government and industry collaboration, which will take six million tonnes of CO2 out of the atmosphere, as well as our collaboration in research and development. Canada's steel sector has an impressive track record of announced projects to date. Six million tonnes is significant not just for the industry but also, I believe, for the entire Canadian economy.

However, we have more reductions that we can achieve, and we will need partnerships to get there. Governments around the world recognize that we're in a race for these investments, and Canada must recognize this as well.

Thank you for your time and attention.

We look forward to answering any questions.