Small suppliers need financial tools amid trade war, MSTA Canada says

In light of ongoing tariff escalation, the Mining Suppliers Trade Association of Canada (MSTA Canada) says the government needs to give more support to small and medium-sized enterprises (SMEs).

In a news release this week, the association called on federal and provincial governments to collaborate directly with it to deliver programs and services to mining suppliers.

“Over 75% of our members continue to report that trade friction and cross-border tariffs directly compromise their daily operations,” said Ryan McEachern, MSTA Canada’s managing director. “Because our sector is dominated by SMEs rather than massive conglomerates, absorbing these shocks is particularly difficult.”

Data from Innovation, Science and Economic Development Canada (ISED) showed that in 2025 over 92% of Canadian machinery manufacturers employed fewer than 100 people.

McEachern says the trade war has created uncertainty for companies, leading to delayed equipment shipments and increased administrative costs.

MSTA Canada’s statement follows Prime Minister Mark Carney’s decision to walk away from U.S. trade negotiations on Friday. The following day, Trump imposed 50% tariffs on about $20 billion worth of Canadian goods. Carney promised Canada would retaliate dollar-for-dollar beginning Sept. 8.

Counter-tariffs

Despite its membership’s financial difficulties, McEachern says the association supports retaliatory tariffing measures. 

“We firmly believe in Canada Strong and understand that defending Canadian industry requires short-term pain to protect our long-term economic sovereignty,” said McEachern. 

He added that MSTA Canada does advocate for some exemptions on highly specialized U.S. equipment and where no viable domestic or international substitute exists. 

Meanwhile, U.S. tariffs of 10%–25% or more on imported fabricated metals and heavy machinery parts are squeezing Canadian suppliers as American buyers push some of the added costs back onto them, forcing firms to accept lower margins to compete with U.S.-based OEMs, according to TD Bank data provided by McEachern.

Knock-on effects

In addition, heavy manufacturing often involves parts and specialized assemblies crossing the Canada–U.S. border several times before final deployment, McEachern said, citing Export Development Canada (EDC). Accumulated compliance burdens and tariff drag disproportionately affect mid-sized OEMs and machine shops.

Tariffs and counter-tariffs lifted costs for specialized electric equipment, with industrial prices going up 8%, and structural components needed for mine build-outs and exploration camp infrastructure, according to RBC analysis.

In the metals sector, Section 232 tariffs on Canadian steel have hit fabricated metal and structural steel hard. Though primary steel exporters lost market share in the U.S., domestic Canadian fabricators faced high price volatility and supply-chain friction when delivering modular mining units or structural assemblies to cross-border projects, analysis from RBC Economics shows.

Tailored financing tools

MSTA Canada says the government needs to seize more opportunities abroad to help SMEs diversify their clientele and prepare for “the next wave of economic growth in Canada.”

“[We’re] not asking for handouts or bailouts — we want to grow our way out of this trade friction by capturing new global market share,” said McEachern.

Specifically, the association is asking Ottawa for growth capital, increased grant funding and direct market-entry assistance for Canadian suppliers working in Latin America, Europe, Australia, Africa and Asia.

McEachern also argues that SMEs need targeted financing tools, including flexible liquidity, credit and working-capital solutions through EDC and the Business Development Bank of Canada (BDC) to support them through the trade war.

The final item on MSTA Canada’s horizon is a seat at the table. It says direct inclusion of the mining supply and services sector in trade policy discussions is a necessity. 

“The sector can pivot,” McEachern added. “How fast we pivot will be determined by the level of support we receive from government.”