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President Trump enacted a blanket 25% tariff on all steel imports and maintained a 25% tariff on aluminum imports, eliminating prior country-specific exemptions and quota arrangements under revised Section 232 proclamations.

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The administration directed the Department of Commerce to expand tariffs to additional derivative steel articles, while U.S. Customs and Border Protection will implement stricter reporting requirements on steel content for imported products.

Although the U.S. briefly threatened to raise tariffs on Canadian steel and aluminum to 50% in response to Ontario’s electricity surcharge, the increase was rescinded after Ontario suspended the surcharge, leaving the 25% tariff intact.

Major trade partners announced countermeasures, including EU tariffs on $28 billion of U.S. goods and Canada’s 25% tariffs on nearly $30 billion in U.S. exports, with additional retaliatory actions possible in 2025.

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President Donald Trump&nbsp;<a href="https://url.us.m.mimecastprotect.com/s/iOIoCwpnDOskx033CVflUJbZfp?domain=rnn4sp8ab.cc.rs6.net" target="_blank" rel="noreferrer noopener">announced that a 25% tariff on all steel and aluminum imports</a>&nbsp;would take effect today, eliminating previous country exemptions.&nbsp;

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The revised Proclamation 9705 and Proclamation 9980 amend the duty rates and eliminate all previous exemptions and quotas, maintaining a 25% ad valorem tariff on most steel articles and a 10% duty on derivative aluminum articles, with exemptions for specific countries. The latest changes extend or modify exclusions for the European Union (EU), Japan, the UK, Ukraine, and others, with some exemptions set to expire in 2024 or 2025 unless further extended. Additionally, the Secretary of Commerce is directed to establish a process for including more derivative steel articles under these duties, while Customs and Border Protection (CBP) will implement stricter reporting requirements on steel content for imports.&nbsp;

In response to Ontario's 25% surcharge on electricity exports to U.S. states, Trump initially threatened to double tariffs on Canadian steel and aluminum imports to 50%.&nbsp;However, after Ontario suspended its electricity surcharge, Trump rescinded the additional tariff threat, maintaining the 25% rate.&nbsp;

Read the steel Federal Register notice&nbsp;<a href="https://url.us.m.mimecastprotect.com/s/ej7aCxkoEPhDvmoofvhlUykcMe?domain=rnn4sp8ab.cc.rs6.net" target="_blank" rel="noreferrer noopener">here</a>&nbsp;and the aluminum Federal Register notice&nbsp;<a href="https://url.us.m.mimecastprotect.com/s/td-aCyPpG0cKo655iQinUxYjhE?domain=rnn4sp8ab.cc.rs6.net" target="_blank" rel="noreferrer noopener">here</a>. Read the steel CBP guidance&nbsp;<a href="https://url.us.m.mimecastprotect.com/s/xugZCzpqJRsEq8ooHKsBU9DEAX?domain=rnn4sp8ab.cc.rs6.net" target="_blank" rel="noreferrer noopener">here</a>&nbsp;and the aluminum CBP guidance&nbsp;<a href="https://url.us.m.mimecastprotect.com/s/aFWQCAD8GwFBOrAAHQt6UGkyHa?domain=rnn4sp8ab.cc.rs6.net" target="_blank" rel="noreferrer noopener">here</a>.

Section 232 Retaliatory Actions Announced

In&nbsp;<a href="https://url.us.m.mimecastprotect.com/s/Tk0-CBB1Jxs0KP55H1uRU28j5k?domain=rnn4sp8ab.cc.rs6.net" target="_blank" rel="noreferrer noopener">response to recent U.S. tariffs on imported steel and aluminum</a>, several key trading partners have implemented retaliatory measures targeting American products. The EU announced tariffs affecting approximately $28 billion worth of U.S. goods, including motorcycles, whiskey, and chewing gum, with some measures reinstated from previous disputes and new tariffs set to take effect in mid-April. Mexican President Claudia Sheinbaum has&nbsp;<a href="https://url.us.m.mimecastprotect.com/s/ALfyCDkwLzhwAjllfRCgUjgWLC?domain=rnn4sp8ab.cc.rs6.net" target="_blank" rel="noreferrer noopener">postponed announcing retaliatory measures against U.S. tariffs</a>, including those under Section 232, until after April 2, 2025, when reciprocal tariffs are expected to be announced. Sheinbaum's administration has condemned the U.S. tariffs as violations of the USMCA and is preparing countermeasures to protect Mexico's interests.&nbsp;

Additionally, Canada&nbsp;<a href="https://url.us.m.mimecastprotect.com/s/LKa4CERKMAFOx155ixF6U7tFvP?domain=rnn4sp8ab.cc.rs6.net" target="_blank" rel="noreferrer noopener">announced</a>&nbsp;it is imposing&nbsp;25% counter tariffs&nbsp;on&nbsp;<a href="https://url.us.m.mimecastprotect.com/s/2pUGCG6wODhE4W55HrH2UB7aZX?domain=rnn4sp8ab.cc.rs6.net" target="_blank" rel="noreferrer noopener">$29.8 billion&nbsp;worth of U.S. imports</a>, including&nbsp;$12.6 billion in steel, $3 billion in aluminum,&nbsp;and&nbsp;$14.2 billion&nbsp;in other goods like tools, computers, and sports equipment, in response to U.S. tariffs on Canadian steel and aluminum. These tariffs add to Canada’s previous&nbsp;$30 billion in countermeasures&nbsp;under the IEEPA. If the U.S. tariffs remain,&nbsp;further measures could be imposed on April 2&nbsp;following a public comment period. Canada is also reviewing potential tariffs on&nbsp;derivative steel and aluminum products.&nbsp;A&nbsp;remission process&nbsp;will allow businesses to seek&nbsp;exceptional relief&nbsp;from the tariffs, and U.S. goods&nbsp;already in transit&nbsp;before&nbsp;March 13,&nbsp;will be exempt.&nbsp;

President Donald Trump has&nbsp;<a href="https://url.us.m.mimecastprotect.com/s/qmfMCJ6EgJhlwpEEHKI2UywV0A?domain=rnn4sp8ab.cc.rs6.net" target="_blank" rel="noreferrer noopener">postponed the implementation of 25% tariffs</a>&nbsp;on a significant portion of Mexican and Canadian goods, granting a one-month exemption for products that comply with the U.S.-Mexico-Canada Agreement (USMCA). This&nbsp;<a href="https://url.us.m.mimecastprotect.com/s/DNG2CKrAj0IPW855HkSAU5kBiI?domain=rnn4sp8ab.cc.rs6.net" target="_blank" rel="noreferrer noopener">reprieve</a>&nbsp;affects approximately 38% of Canadian imports and 50% of Mexican imports. The decision aims to minimize disruptions to industries such as automotive manufacturing and agriculture, addressing concerns over fertilizer prices and supply chain stability. Initially scheduled to take effect on March 4, the tariffs are now set to be enforced on April 2, contingent upon progress in addressing issues like illegal migration and fentanyl trafficking. The exemption is effective as of March 7.

View the orders for Canada&nbsp;<a href="https://url.us.m.mimecastprotect.com/s/f_H0CL9AkLIV9NnnSYTlUysh8l?domain=rnn4sp8ab.cc.rs6.net" target="_blank" rel="noreferrer noopener">here</a>&nbsp;and the orders for Mexico&nbsp;<a href="https://url.us.m.mimecastprotect.com/s/UguMCM87lMsD3x44fqUGU83g9t?domain=rnn4sp8ab.cc.rs6.net" target="_blank" rel="noreferrer noopener">here</a>. View the Federal Register notice for Canada&nbsp;<a href="https://url.us.m.mimecastprotect.com/s/jwuoCNk7mNhJ3Vmmh3cvUyj9A1?domain=rnn4sp8ab.cc.rs6.net" target="_blank" rel="noreferrer noopener">here</a>&nbsp;and the Federal Register notice for Mexico&nbsp;<a href="https://url.us.m.mimecastprotect.com/s/IMfECOYJnOclx5mmH9fgUGo4H-?domain=rnn4sp8ab.cc.rs6.net" target="_blank" rel="noreferrer noopener">here</a>.&nbsp;

Response from Canada and Mexico on IEEPA Tariffs

Canada has&nbsp;<a href="https://url.us.m.mimecastprotect.com/s/kb_FCPN6oPu9XvEESJhDUxBuFh?domain=rnn4sp8ab.cc.rs6.net" target="_blank" rel="noreferrer noopener">initiated a dispute resolution process</a>&nbsp;at the World Trade Organization (WTO) in response to President Donald Trump's 25% tariffs on Canadian goods, requesting consultations with the United States. Canadian Ambassador to the WTO Nadia Theodore stated that Canada was compelled to protect its interests, expressed regret over the situation, and urged the U.S. to reconsider the tariffs.&nbsp;Both Canada and Mexico have also expressed that these tariffs violate the USMCA and have indicated potential retaliatory measures.&nbsp;

Last Friday, President Trump said he&nbsp;<a href="https://url.us.m.mimecastprotect.com/s/H2h2CQWApQIgPBjjili3UGxhCS?domain=rnn4sp8ab.cc.rs6.net" target="_blank" rel="noreferrer noopener">may impose reciprocal tariffs on Canadian lumber and dairy products</a>, accusing Canada of unfairly charging high tariffs on U.S. goods. Trump has long criticized Canada’s dairy tariffs, which range from 241% on fluid milk to 299% on butter, and warned that Canada would face the same tariffs unless they lower theirs. Additionally, Mark Carney, former governor of the Bank of Canada and the Bank of England,&nbsp;<a href="https://url.us.m.mimecastprotect.com/s/pUT7CR68qRhoWnqqHVsNU19DVT?domain=rnn4sp8ab.cc.rs6.net" target="_blank" rel="noreferrer noopener">has been elected leader of Canada's Liberal Party</a>, succeeding Justin Trudeau as prime minister. Carney, who secured 85.9% of the leadership vote, assumes office amid escalating trade tensions with the United States, following President Trump's imposition of tariffs on Canadian goods and threats of annexation.

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Do the steel and aluminum or USMCA product tariffs impact you? Please contact Sarah Helton, Michael Best Strategies’ Trade Practice Lead at <a href="mailto:sarah.helton@michaelbest.com" target="_blank" rel="noreferrer noopener">sarah.helton@michaelbest.com</a> for assistance. 

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Trump Trade 2.0: Section 232 Steel and Aluminum Tariffs Enacted

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