U.S. President Donald Trump has announced plans to introduce new 25% tariffs on all steel and aluminum imports, marking a significant escalation in his trade policy agenda.
Speaking to reporters aboard Air Force One while traveling to the NFL Super Bowl in New Orleans, Trump stated that the new tariffs would be formally announced on Monday, with additional reciprocal tariffs expected later in the week.
The proposed tariffs will apply to all countries, including major steel and aluminum exporters to the U.S. such as Canada, Brazil, Mexico, South Korea, and Vietnam. Justifying the move as part of his broader push for fairer trade terms, Trump stated, “And very simply, if they charge us, we charge them.”
Impact on Key Trading Partners
According to government and industry data, Canada is the largest supplier of aluminum to the U.S., accounting for 79% of total imports in the first 11 months of 2024. Canada is also among the top steel exporters to the U.S.
The announcement has raised concerns among policymakers. Canadian Innovation Minister François-Philippe Champagne emphasized the critical role of Canadian metals in U.S. industries such as defense, shipbuilding, and automotive manufacturing.
Quebec Premier François Legault called for an urgent renegotiation of the U.S.-Canada free trade agreement, citing the heavy reliance of U.S. industries on Quebec’s aluminum exports.
“Quebec exports 2.9 million tons of aluminum to the U.S., fulfilling 60% of their needs. Do they prefer to get supplies from China?” Legault questioned.
Trade and Industry Reactions
Trump also confirmed that while Japan’s Nippon Steel would be allowed to invest in U.S. Steel, it would not be permitted to acquire a majority stake.
“Tariffs are going to make [U.S. Steel] very successful again, and I think it has good management,” Trump said.
His first administration had previously imposed similar tariffs in 2018, though exemptions were later granted to certain trade partners, including Canada, Mexico, and Brazil. Under former President Joe Biden, duty-free quota arrangements were negotiated with the UK, EU, and Japan. However, Trump did not specify whether these exemptions would remain in place.
The American Iron and Steel Institute (AISI) expressed strong support for the tariffs. Its president, Kevin Dempsey, stated, “We look forward to working closely with the President to implement a robust trade agenda that addresses foreign market distortions.”
However, trade experts caution that the tariffs could provoke retaliatory measures from key partners. The European Union, which previously imposed countermeasures on U.S. whiskey and other goods in response to Trump’s tariffs, may reintroduce similar actions.
Chris Swonger, CEO of the Distilled Spirits Council of the U.S., warned that rising trade tensions could result in the EU reinstating a 50% tariff on American whiskey, potentially devastating the industry.
A Shift Toward Protectionism
Trump has long criticized global trade imbalances, particularly the EU’s 10% tariff on auto imports compared to the U.S.’s 2.5% rate. He has frequently argued that Europe benefits disproportionately from trade while imposing restrictive measures on U.S. exports.
With the U.S. trade-weighted average tariff rate currently at 2.2%—significantly lower than countries such as India (12%), Brazil (6.7%), and the EU (2.7%)—Trump’s latest move signals a stronger shift toward protectionist policies aimed at reshaping global trade.
Further details on the administration’s reciprocal tariff strategy are expected at a press conference later this week.
As markets react to the announcement, analysts predict increased volatility in the steel and aluminum sectors, with potential repercussions for manufacturing costs and consumer prices in the U.S. and beyond.
