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Trump raises aluminum tariffs to 25% from 10%

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Trump targets downstream steel products for tariffs

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Trump also promises broader reciprocal tariffs

By Steve Holland, David Lawder and Andrea Shalal

WASHINGTON, Feb 10 (Reuters) - President Donald Trump

substantially raised tariffs on steel and aluminum imports on

Monday to a flat 25% "without exceptions or exemptions" in a

move to aid the struggling industries but which increases the

risk of a multi-front trade war.

Trump signed proclamations raising the U.S. tariff rate on

aluminum to 25% from his previous 10% rate and eliminating

country exceptions and quota deals as well as hundreds of

thousands of product-specific tariff exclusions for both metals.

A White House official confirmed that the measures would take

effect on March 4.

The tariff rate will rise back to 25% on millions of tons of

steel and aluminum imports from Canada, Brazil, Mexico, South

Korea and other countries that had been entering the U.S. duty

free under the carve-outs.

The move will simplify tariffs on the metals "so that

everyone can understand exactly what it means," Trump told

reporters. "It's 25% without exceptions or exemptions. That's

all countries, no matter where it comes from, all countries."

Trump later said he would give "great consideration" to

Australia's request for an exemption to the steel tariffs.

The proclamations were extensions of Trump's 2018 Section

232 tariffs to protect domestic steel and aluminum makers on

national security grounds. A White House official said the

exemptions had eroded the effectiveness of these measures.

Trump also will impose a new North American standard

requiring steel imports to be "melted and poured" and aluminum

to be "smelted and cast" within the region to curb U.S. imports

of minimally processed Chinese and Russian metals.

The order also extends the tariffs to downstream products

that use foreign-made steel, including fabricated structural

steel, aluminum extrusions and steel strand for pre-stressed

concrete, a White House official said.

As he signed the order at the White House, Trump said he

would follow Monday's action with announcements about reciprocal

tariffs on all countries that impose duties on U.S. goods over

the next two days, and said he was also looking at tariffs on

cars, semiconductor chips and pharmaceuticals.

Asked about threats of retaliation by other countries

against his new tariffs, Trump said: "I don't mind."

Trump's trade adviser Peter Navarro said the latest measures

would help U.S. steel and aluminum producers and shore up

America's economic and national security.

"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 pillar industries of

America's economic and national security," he told reporters.

"This isn't just about trade. It's about ensuring that

America never has to rely on foreign nations for critical

industries like steel and aluminum."

Trump first targeted steel and aluminum for tariffs in

2018 under a Cold War-era national security law. He later

granted several countries exemptions, including Canada, Mexico

and Australia, and struck duty-free quota deals for Brazil,

South Korea and Argentina based on pre-tariff volumes.

Trump's successor, Former President Joe Biden, later

negotiated similar duty-free quotas for Britain, Japan and the

EU.

"We applaud the president for instituting these 25% tariffs

on steel imports and getting rid of exclusions, carveouts and

quotas that are based on antiquated data," said Philip Bell,

president of the Steel Manufacturers Association.

These were based on 2015-2017 import levels that no longer

reflect current market dynamics, Bell said.

Before the proclamations, shares in U.S. steel and aluminum

makers jumped, while shares in European and Asian steelmakers

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

Brazil and Mexico, followed by South Korea and Vietnam,

according to government and industry data.

Canada, whose extensive hydropower resources aid its metal

production, accounted for 79% of U.S. primary aluminum imports

in the first 11 months of 2024.

U.S. trade partners warned the new barriers would hurt U.S.

automakers, shipbuilders and other industries.

"Australian steel and aluminum are creating thousands of

good-paying American jobs, and are key for our shared defense

interests," Australian Trade Minister Don Farrell said.

U.S. distillers warned that the steel tariffs could prompt

the EU to raise duties on American whiskey.

"A 50% tariff on America's native spirit will have a

catastrophic outcome for the 3,000 small distilleries across the

United States," said Chris Swonger, CEO of the Distilled Spirits

Council of the United States.

The European Commission said it saw no justification for the

tariffs and said President Ursula von der Leyen would meet U.S.

Vice President JD Vance in Paris on Tuesday during an AI summit.

In South Korea, the Industry Ministry called in steelmakers

to discuss how to minimize the impact of tariffs.

RECIPROCAL TARIFFS

Trump also has promised detailed information on Tuesday or

Wednesday on his reciprocal tariff plan. He 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

like General Motors ( GM ).

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 EU.

Indian Prime Minister Narendra Modi is preparing tariff

cuts ahead of a Wednesday meeting with Trump that could boost

American exports, Indian government officials said. Trump has

previously called India a "very big abuser" on trade, and his

top economic adviser Kevin Hassett singled out the country as

having "enormously high" tariffs in a CNBC interview.

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.

U.S. data showed that demand for aluminum last year far

exceeded domestic production, leaving the country largely

reliant on imports.