Trump to announce 25% steel and aluminium tariffs in latest trade escalation
By Jeff Mason
ABOARD AIR FORCE ONE - US President Donald Trump said on Sunday he will introduce new 25% tariffs on all steel and aluminium imports into the US, on top of existing metals duties, in another major escalation of his trade policy overhaul.
Trump, speaking to reporters on Air Force One on his way to the NFL Super Bowl in New Orleans, said he will announce the new metals tariffs on Monday.
He also said he will announce reciprocal tariffs on Tuesday or Wednesday, to take effect almost immediately, applying them to all countries and matching the tariff rates levied by each country.
"And very simply, it's, if they charge us, we charge them," Trump said of the reciprocal tariff plan.
The largest sources of US steel imports are Canada, Brazil and Mexico, followed by South Korea and Vietnam, according to government and American Iron and Steel Institute data.
By a large margin, hydropower-rich Canada is the largest supplier of primary aluminium metal to the US, accounting for 79% of total imports in the first 11 months of 2024.
"Canadian steel and aluminium support key industries in the US from defence, shipbuilding and auto," Canadian Innovation Minister Francois-Philippe Champagne posted on X.
"We will continue to stand up for Canada, our workers, and our industries."
Trump also said that while the US government would allow Japan's Nippon Steel to invest in US Steel, it would not allow this to become a majority stake.
"Tariffs are going to make it very successful again, and I think it has good management," Trump said of US Steel.
Nippon Steel declined to comment on the latest announcements from Trump.
QUOTA QUESTIONS
Trump during his first term imposed tariffs of 25% on steel and 10% on aluminium, but later granted several trading partners duty-free exemptions, including Canada, Mexico and Brazil. Mexico is a major supplier of aluminium scrap and aluminium alloy.
Former President Joe Biden later negotiated duty-free quota arrangements with Britain, the European Union and Japan. It was not immediately clear from Trump's announcement what will happen to those exemptions and quota arrangements.
"Quebec exports 2.9 million tons of aluminium to (the US), that is, 60% of their needs. Do they prefer to get supplies from China?" Francois Legault, premier of Quebec, said on X.
"All this shows that we must begin to renegotiate our free trade agreement with the United States as soon as possible and not wait for the review planned for 2026. We must put an end to this uncertainty.”
Steel mill capacity usage jumped to levels above 80% in 2019 after Trump's initial tariffs, but has fallen since then as China's global dominance of the sector has pushed down steel prices. A Missouri aluminium smelter revived by the tariffs was idled last year by Magnitude 7 Metals.
Kevin Dempsey, president and CEO of the American Iron and Steel Institute (AISI), said the industry trade group welcomed Trump's commitment to a strong American steel industry.
"We look forward to working closely with the President and his administration to implement a robust and reinvigorated trade agenda to address the many foreign market-distorting policies and practices that create an unlevel playing field for American steelmakers.”
MATCHING RATES
Trump said he would hold a news conference on Tuesday or Wednesday to provide detailed information on the reciprocal tariff plan, adding that he first revealed on Friday that he was planning reciprocal tariffs to ensure "that we're treated evenly with other countries."
The new US president has long complained about the EU's 10% tariffs on auto imports being much higher than the US car rate of 2.5%. He frequently states that Europe "won't take our cars" but ships millions west across the Atlantic every year.
The US, however, enjoys a 25% tariff on pick-up trucks, a vital source of profit for Detroit automakers General Motors, Ford and Stellantis' US operations.
The US trade-weighted average tariff rate is about 2.2%, according to World Trade Organization data, compared to 12% for India, 6.7% for Brazil, 5.1% for Vietnam and 2.7% for European Union countries.
Chris Swonger, CEO of the Distilled Spirits Council of the United States, expressed concern that Trump’s new steel tariffs would lead to the EU reimposing retaliatory duties on American whiskey and raising them to 50%.
“We are urging that the US and EU move swiftly to find a resolution. Our great American whiskey industry is at stake. A 50% tariff on America's native spirit will have a catastrophic outcome for the 3,000 small distilleries across the United States.”
BORDER STEPS
In a separate Fox News interview, Trump said Canada's and Mexico's actions to secure their US borders and halt the flow of drugs and migrants are insufficient ahead of a March 1 tariff deadline.
Trump has threatened to impose tariffs of 25% on all Mexican and Canadian imports unless America's two largest trading partners take stronger actions.
He paused the tariffs until March 1 after some initial border security concessions from the two countries, with Mexico pledging to add 10,000 National Guard troops to its border and Canada deploying new technology and personnel and taking new anti-fentanyl steps.
Asked whether Mexico's and Canada's actions were good enough, Trump replied: "No, it's not good enough," Trump said. "Something has to happen, it's not sustainable, and I'm changing it."
Trump did not say what Canada and Mexico needed to do to avoid broad tariffs on March 1.
- REUTERS