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Trump to announce steel and aluminium tariffs on Monday

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Importers to pay 25% on top of existing tariffs

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Pledges add to multi-front trade upheaval

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Trump also promises broader reciprocal tariffs for

Tues/Wed

SEOUL/FRANKFURT, Feb 10 (Reuters) - Shares in European

and Asian steelmakers fell on Monday after U.S. President Donald

Trump said he would introduce 25% tariffs on all steel and

aluminium imports within hours in addition to existing metals

duties.

As the risk mounts of a multi-front trade war, the European

Union (EU) has flagged it may retaliate and Trump has promised

further announcements on Tuesday or Wednesday of broader

reciprocal tariffs to match those of countries importing U.S.

goods.

Speaking to reporters on his way to Sunday's NFL Super Bowl

in New Orleans, Trump said he would announce the metals tariffs

on Monday and the reciprocal tariffs soon afterwards, adding "if

they charge us, we charge them".

The largest sources of U.S. steel imports are Brazil, Canada

and Mexico, followed by South Korea and Vietnam, according to

government and American Iron and Steel Institute data.

Meanwhile, Canada, whose extensive hydropower resources aid

its metal production, accounted for 79% of U.S. primary

aluminium imports in the first 11 months of 2024.

During his first four-year term from 2017, Trump imposed

tariffs of 25% on steel and 10% on aluminium.

But he later granted several trading partners exemptions,

including Australia, Brazil, Canada and Mexico, and his

successor Joe Biden later negotiated duty-free quota deals with

Britain, Japan and the EU.

With Trump similarly expected to inspire demands for

exemption and negotiation, some in government and industry said

his action would first of all damage the U.S. economy by

increasing the cost of the raw materials it depends on.

"Canadian steel and aluminum support key industries in the

U.S. 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."

Australia, also a strategic U.S. ally, has been making

representations on aluminium and steel for months.

"Australian steel and aluminium are creating thousands of

good paying American jobs, and are key for our shared defence

interests," Trade Minister Don Farrell said.

EU AND SOUTH KOREA WEIGH RESPONSES TO TRUMP TARIFFS

In South Korea, the Industry Ministry called in steelmakers

to discuss how to minimise the impact of tariffs.

Hyundai Steel shares dipped by as much as 2.9%

amid a broader decline among South Korean steelmakers.

European steelmakers account for about 15% of imports into

the United States, and shares in ArcelorMittal,,

Voestalpine, Thyssenkrupp and Salzgitter

were down by between 0.6% and 2.2%.

The European Commission in Brussels said it saw no

justification for the imposition of tariffs on its exports,

adding: "We will react to protect the interests of European

businesses, workers and consumers."

Shares in U.S. steel and aluminium makers jumped in

premarket trading.

Nucor ( NUE ) rose 9.5%, Steel Dynamics ( STLD ) 6.3%,

Century Aluminum ( CENX ) 9.4%, and Alcoa ( AA ) 5.9%.

Trump also said that, while the U.S. government would allow

Japan's Nippon Steel ( NISTF ) to invest in U.S. Steel, it

would not let it take a majority stake.

"Tariffs are going to make (U.S. Steel) very successful

again," Trump said.

Nippon Steel ( NISTF ) declined to comment, but Japan's Chief Cabinet

Secretary Yoshimasa Hayashi said the company was considering a

bold change in plan.

U.S. steel mill capacity usage jumped to levels above 80% in

2019 after Trump's initial tariffs, but has since fallen as

China's global dominance - unaffected by its exclusion by

tariffs from the U.S. market - has pushed down prices.

A Missouri aluminium smelter revived by the previous tariffs

was idled last year by Magnitude 7 Metals.

Kevin Dempsey, head of the American Iron and Steel

Institute, said it would work with Trump "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".

TRUMP PROMISES RECIPROCAL TARIFF ANNOUNCEMENT SHORTLY

Trump also promised detailed information on Tuesday or

Wednesday on his reciprocal tariff plan.

The president has long complained about the EU's 10% tariff

on auto imports, much higher than the U.S. car rate of 2.5%.

However the U.S. applies a 25% tariff on pickup trucks, a

vital source of profit for Detroit automakers General Motors ( GM )

, Ford and Stellantis' ( STLA ) U.S. operations.

Overall, the U.S. 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

the European Union.

Chris Swonger, CEO of the Distilled Spirits Council of the

United States, said Trump's new steel tariffs could lead to the

EU imposing retaliatory duties on American whiskey of up to 50%.

"We are urging that the U.S. 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," he said.

Trump had already threatened to impose tariffs of 25% on all

imports from America's two largest trading partners, Canada and

Mexico, saying they must do more to halt the flow of drugs and

migrants across the U.S. border.

After some border security concessions, Trump paused the

tariffs until March 1. But he told Fox News that more measures

were needed.

"Something has to happen, it's not sustainable," he said,

"and I'm changing it."