US president Donald Trump has imposed fresh tariffs of 50% on most steel and aluminium imports to his country – though the UK is facing a lower rate as things stand.
Writing on his Truth Social platform, Trump said that the new tariffs, which double the previous rate of 25%, would mean “we're going to produce our own metal, unleash our own energy, secure our own future, build our country, control our destiny”. He namechecked Pennsylvanian steel as having the potential to become the “backbone” of the US.
The announcement comes as Trump has backed a controversial deal for Japan’s Nippon Steel to take over US Steel to the tune of US$14bn, which he has suggested could restore US-based steel manufacturing.
Speaking at a rally in Pennsylvania, he announced the tariffs on Friday (30 May), before they took effect today (4 June). He said last week:
"We are going to be imposing a 25% increase. We're going to bring it from 25% to 50% - the tariffs on steel into the United States of America, which will even further secure the steel industry in the US.”
UK exemption
The UK has been exempted from the rise in duty, leaving its US steel exports facing only a 25% rate. However, the US administration has emphasised that, should conditions agreed under last month’s Economic Prosperity Deal (EPD) not be met, the UK could face the higher rate as soon as 9 July.
Speaking to the BBC, UK Steel chief executive Gareth Stace said the industry in the UK can “breathe a temporary sigh of relief”, but that “what we really want to get to is those tariffs removed” entirely.
“We hope that a deal can be made soon enough, and certainly before 9 July, which is the next deadline in our tariff story.”
He also warned that US measures could direct other nations’ steel to the UK market and crowd out domestic production, and encouraged the government “to make sure we don't suddenly find ourselves with a flood of steel that can put us out of business”.
Other reactions
The move has not been welcomed by Canada, where president of the Canadian Chamber of Commerce Candace Laing said it was “antithetical to North American economic security”.
“Unwinding the efficient, competitive and reliable cross-border supply chains like we have in steel and aluminum [sic] comes at a great cost to both countries.”
An EU spokesperson, meanwhile, said “this decision adds further uncertainty to the global economy and increases costs for consumers and businesses on both sides of the Atlantic”, noting that the bloc “is prepared to impose countermeasures”.
The EU has been preparing more broadly for trade talks with Trump that it fears could have ramifications in other areas of the US relationship. The FT reports today that the bloc’s negotiators are concerned that the trade dispute could spill over into discussions over the funding of NATO, as well as support for Ukraine in its war with Russia.
Former chief diplomat for the bloc Josep Borrell said:
“All these crises, all at once: it’s the perfect storm. [Trump] may try to squeeze us, and could push us in the corner from all three directions.”
