On Monday, President Trump signed an announcement to increase the tariff rates on steel and aluminum imports from 10% to 25%, and simultaneously eliminated national exemptions and quota trading for these metals, as well as tariff exemptions for hundreds of thousands of specific products. A White House official confirmed that these measures will take effect on March 4. The tariffs will apply to millions of tons of steel and aluminum products imported from the European Union, Canada, Brazil, Mexico, South Korea, and other countries. Previously, these products had entered the U.S. duty-free under exemption clauses.
President Trump informed reporters that this move aims to simplify metal tariffs, stating, “Everyone will be clear, it’s 25% with no exceptions or exemptions, applicable to all countries.” Additionally, President Trump announced that within the next two days, he will impose retaliatory tariffs on all countries levying tariffs on American goods and is considering tariffs on automobiles, semiconductors, and pharmaceuticals.
The President of the European Commission, Ursula von der Leyen, expressed regret over the U.S.’ decision to increase tariffs, believing that tariffs, as a form of taxation, are disadvantageous to businesses and consumers. In the past decade, the average annual steel exports from the EU to the U.S. amounted to approximately €30 billion (or $31 billion).
She stated in a release that the EU will respond to the U.S.’ tariff imposition to “take action to safeguard its own interests.” Von der Leyen did not provide specific details of the planned response. One potential option for the EU is to reinstate tariffs imposed in 2018, which were later suspended following a truce agreement between von der Leyen and then-U.S. President Biden.
Currently, EU tariffs on American products such as bourbon whiskey, motorcycles, and orange juice are suspended until the end of March. According to data from the American Iron and Steel Institute, in 2023, steel imports accounted for about 23% of U.S. steel consumption, with Canada, Brazil, and Mexico being the largest suppliers.
Canada’s abundant hydropower resources contribute to its metal production. In 2024, nearly 80% of the primary aluminum produced in Canada was imported by the U.S. Canadian Prime Minister Justin Trudeau expressed on Tuesday that these tariffs are difficult to accept. Trudeau voiced his displeasure at the Paris Artificial Intelligence Summit, stating that Canada will highlight the side effects of tariffs and if necessary, will respond firmly and clearly.
Trump will also implement a new North American standard requiring imported steel and aluminum to be “melted and cast” within the region to prevent Chinese and Russian minimally processed metals from circumventing other tariffs and being exported to the U.S. The U.S. believes that despite China’s relatively small steel exports to the U.S., it bears significant responsibility for global steel overcapacity. This is because the Chinese government subsidizes its enterprises, enabling them to export more steel through other countries to the U.S., evading American tariffs and other trade restrictions.
Following the drop in stock prices of Asian and European steel manufacturers on Monday, Chinese steel manufacturers saw further declines on Tuesday, while American steel and aluminum manufacturers’ stocks surged ahead of the U.S. tariff announcement.
(Assisted by Reuters)