(Adds quotes from USW, Canadian steel producers, governmentofficial, trade lawyer, Alcoa (NYSE:AA))
By Leah Schnurr and Andrea Hopkins
OTTAWA, March 1 (Reuters) - Canada will retaliate againstany U.S. tariffs on steel and aluminum products, officials saidon Thursday, as Ottawa faced what could be one of the biggesteconomic threats since Donald Trump became president.
Trump unveiled the tariffs on Thursday but did not makeclear whether they would apply to Canada and Mexico, whichtogether with the United States are trying to renegotiate the24-year-old North American Free Trade Agreement. restrictions be imposed on Canadian steel andaluminum products, Canada will take responsive measures todefend its trade interests and workers," Foreign MinisterChrystia Freeland said in a statement, calling any traderestrictions "absolutely unacceptable."
She did not give details, and Canadian officials were notimmediately available for comment on what measures she mighthave in mind.
Canada sends 75 percent of its goods exports to the UnitedStates and would be vulnerable if a trade war erupted. Canada isalso the largest supplier of both steel and aluminum to theUnited States.
Miner Rio Tinto RIO.L , the largest producer of aluminum inCanada, Alcoa Corp AA.N and the United Steelworkers union,which represents workers in both the United States and Canada,all said Canada should be spared from any tariffs.
A Canadian government official, asked whether Ottawa wouldbe pressing for an exemption, said "Our efforts have neverdiminished nor altered" since the question of possible steeltariffs first emerged last year.
Canada buys more American steel than any other country,accounting for 50 percent of U.S. exports, and the steel andaluminum industry is highly integrated, Freeland said.
Joseph Galimberti, president of the Canadian Steel ProducersAssociation, said there was still room for Canada to be grantedan exemption.
"The government has been quite active ... in putting forwardthe case for our exemption and we expect them to continue to doso," he said by phone.
The Trump administration - which Freeland generallydescribes as the most protectionist since the 1930s - has soughtto impose tariffs on Canadian softwood lumber and aircraft overthe last year.
Canada pushed back on both occasions and won a victory inJanuary when a U.S. tribunal rejected Boeing (NYSE:BA) Co's BA.N callsfor punitive duties against Bombardier Corp BBDb.TO passengerjets.
"We will always be there to defend workers and industry. Weshowed it on softwood lumber and showed it with the Boeingcase," Trade Minister Francois-Philippe Champagne told reportersin Ottawa.
CIBC economists Royce Mendes and Avery Shenfeld said thetariffs "could be more biting for the Canadian economy thanprevious moves by the administration" and said the prospects forretaliation were limited.
"In many cases, Canada doesn't have a domestic source ofsupply that would benefit from hitting U.S. goods with atariff," they said in a note to clients.
International trade lawyer Mark Warner said Canada could ifit wished quickly apply tariffs on steel or aluminum or othertargeted products.
"My hope is that the government does not respondprecipitously in tone or action and continues to work for anexemption," he said by e-mail.
Milos Barutciski, head of the international trade practiceat law firm Bennett Jones, said Canada could also imposesanctions by applying for permission through the World TradeOrganization - a process that can take 18 months.
<^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^Automakers among sectors reeling over U.S. steel, aluminumtariffs
ID:nL2N1QJ2K5 BREAKINGVIEWS-Trump tariff chaos shoots America in its own foot
ID:nL2N1QJ1ZN U.S. energy industry slams Trump's 'job-killing' steel tariffs
ID:nL2N1QJ1Y8 U.S. steel, aluminum stocks jump on tariff announcement
ID:nL4N1QJ50H
^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^>