Endorsed by steelworkers onstage, then-Republican presidential nominee Donald Trump puts on a hard hat during his Make America Great Again Rally in Latrobe, Pennsylvania, on Oct. 19, 2024.
US President Donald Trump signed an executive order Monday imposing 25% tariffs on all steel and aluminum imports to the US. This raises the tariff rate on aluminum to 25% from the previous 10% that Trump imposed in 2018, and it reinstates a 25% tariff on “millions of tons” of steel and aluminum imports previously exempted or excluded.
“Today I’m simplifying our tariffs on steel and aluminum,” Trump stated. “It’s 25% without exceptions or exemptions.”
Cue the negotiations. On Monday, Trump reportedly took a call from Australian Prime Minister Anthony Albanese, who is seeking a carve-out for Australian steel exports. Albanese described their conversation as “constructive and warm” but did not want to “speak on [Trump’s] behalf.”
The EU said it would respond with “firm and proportionate countermeasures.” Prime Minister Justin Trudeausaid Tuesday that the tariffs were “entirely unjustified” and “unacceptable,” noting that Canada – the US’ biggest source of aluminum and one of its top sources of steel – would respond if necessary but will try to work with the US administration to avoid them. Mexican President Claudia Sheinbaum, who has also threatened countermeasures in recent weeks, said her country would keep a “cool head.”
The new US tariffs are set to take effect on March 4, and Trump added that he will also consider additional tariffs on cars, pharmaceuticals, and computer chips.
Why now? Trump’s announcement came two days after the visit of Japanese Prime Minister Shigeru Ishiba, who announced that Japan would increase its US investment to $1 trillion, including a commitment from Nippon Steel to “invest heavily” in US Steel, after a $15 billion buyout was nixed last year by the Biden administration. The deal is another reflection of Trump’s plan to strengthen domestic steel production and make imports less attractive – or even necessary.
Was there a connection? “It’s certainly possible,” says Eurasia Group’s Japan Director David Boling. “But we knew steel tariffs were coming — it was only a matter of time. While Trump is proud to be Tariff Man, he could also be called the Man of Steel. Steel is his favorite industry.” We’re waiting to see whether Ishiba picks up the phone like Albanese and leverages Nippon’s investment to lift the levies.