The President of the United States, Donald Trump, signed executive orders to impose tariffs on steel and aluminum imports. The new tariffs sets a 25% rate on these metals with no exceptions or exemptions. “It’s 25% with no exceptions or exemptions. It applies to all countries, regardless of where it comes from,” Donald Trump declared when making the measure official from the White House.
This action aims to strengthen the local steel and aluminum industries in the United States and reduce dependence on foreign imports. However, it also carries the risk of escalating the trade war with its main partners, such as Canada, Brazil, Mexico, and South Korea, which had previously been exempt from these tariffs.
When do the steel and aluminum tariffs take effect?
According to a White House official, the measure will take effect on March 4. From that date onward, steel and aluminum imports from countries that previously had agreements or special exemptions will also be subject to the new 25% tariff.
Which countries will be affected by the tariffs?
The tariff increase will impact several economies, including:
- Canada: Represents nearly 80% of primary aluminum imports to the U.S. in 2024.
- Brazil and Mexico: Among the top suppliers of steel for the U.S. industry.
- South Korea and other Asian countries: Expected to face additional costs when exporting these metals to the United States.
What is the economic impact of the tariffs?
According to data from the American Iron and Steel Institute, 23% of the steel consumed in the United States in 2023 was imported. With the new measure, domestic steel and aluminum prices are expected to rise, benefiting local manufacturers but increasing production costs in industries that depend on these materials, such as:
- Automotive: Vehicle manufacturing costs could rise significantly.
- Construction: Materials such as beams and metal structures will have higher costs.
- Appliances and heavy machinery: Manufacturers may pass the cost increases to end consumers.
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Why did Trump impose these tariffs?
According to Peter Navarro, Trump’s trade advisor, the measure aims to strengthen national security and the U.S. economy. “The steel and aluminum tariffs 2.0 will put an end to foreign dumping, boost domestic production, and secure our steel and aluminum industries as the backbone and pillars of the economic and national security of the United States,” he told Reuters.
Additionally, Trump announced that he would require a North American manufacturing standard, mandating that imported steel be “melted and poured” and aluminum “smelted and cast” within the region. This measure seeks to prevent metals from China and Russia, which have been processed in other countries, from entering to bypass previous tariffs.
What is the state of steel and aluminum in the United States?
The data reflect a decline in domestic production:
- Aluminum production: In 2023, the U.S. produced only 670,000 tons of aluminum, down from 3.7 million in the year 2000.
- Plant closures: Several steel and aluminum factories have closed in recent years, including those in Kentucky and Missouri.
- Imports from Canada: In 2024, the U.S. imported nearly 80% of its primary aluminum from Canada.
