President Trump announced radical rates for foreign steel and aluminum on Monday, so that a policy of his first term was resumed that household metal makers were pleased but other American industries damaged and ignited trade wars on several fronts.
The president signed two official proclamations that would impose a rate of 25 percent on steel and aluminum from all countries. Mr. Trump, who spoke from the Oval Office on Monday evening, called the movements 'a big problem'.
“It's time for our great industries to come back to America,” said the president.
An official of the White House who was not authorized to speak publicly, reporters said on Monday that the move was proof of Mr Trump's dedication to use rates to set the United States on the same basis with other countries. In contrast to Mr Trump's first term, the officer said, no exclusions for the rates for American companies that depend on foreign steel and aluminum are permitted.
The measures were welcomed by domestic steel makers, who have lobby the Trump administration for protection against cheap foreign metals.
But the rates will probably rank the allies of America such as Canada and Mexico, which deliver most of the imports of American metals. They can also generate retribution at American exports, as well as pushback from American industries that use metals to make cars, food packaging and other products. Those sectors will be confronted considerably higher prices after the rates are in force.
That is what happened in Mr Trump's first term, when the president delivered 25 percent rates on foreign steel and aluminum. While Mr. Trump and President Joseph R. Biden Jr. Ultimately, those rates on most large metal suppliers rolled back, the taxes were often replaced by other trade barriers, such as quotas about how much foreign metal could be in the United States.
Studies have shown that although the first round of Mr Trump of metal rates helped the American steel and aluminum producers, they eventually hurt the wider economy because they increased prices for many other industries, including the automatic sector.
The steel rates followed other intense trade threats. In his three weeks in office, the president has already threatened more rates worldwide than in his entire first term, when he imposed rates on foreign solar panels, washing machines, metals and more than $ 300 billion in China products.
Since January 20, Mr. Trump has brought an extra rate of 10 percent on all products from China and within a few hours after the imposition of radical rates to Canada and Mexico that would have brought us tariff rates at a level that has not been going on since the years forty seen. Together, those movements would have influenced more than $ 1.3 trillion goods.
On Monday, Mr. Trump said from the Oval Office that his steel rates were 'the first of many'. He said that his team would meet in the coming four weeks to discuss rates for cars, pharmaceutical products, chips and other goods.
Mr. Trump said on Sunday that he was also planning to continue this week with so -called mutual rates, which would raise certain American rates that correspond to those from abroad.
American steel makers welcomed the rates. In a statement on Sunday, Kevin Dempsey, the president of the American Iron and Steel Institute, said that the group welcomed the “constant dedication of Mr Trump” to a strong American steel industry, which is essential for the national security and economic prosperity of America . “
But industries that use metals to make other products said that overly broad protection would harm them.
“Rates and other broad trading tools can make America great again, but there are unintended consequences for our nation's food security when a rate is placed on tin plate steel,” said Robert Budway, the president of the Can Institute of the manufacturers, who Companies represents, which represents companies that make cans for fruit and vegetables.
The United SteelWorkers Union, who has members in Canada, said it welcomed Mr Trump's efforts to help the industry, but that “Canada is not the problem”.
The new measures will mainly affect our allies. The largest supplier of steel to the United States in 2024 was Canada, followed by Brazil, Mexico, South Korea and Vietnam, according to the American Iron and Steel Institute. Canada is also an important supplier of aluminum to the United States, followed remotely by the United Arab Emirates, Russia and China.
At the end of Monday, the governments of Canada, Mexico and Brazil still had to respond to the rates. The government of Brazil said it had no answer to Mr Trump's announcement of steel rates because it had not yet received official communication from the US government on the issue.
In his first term, Mr. Trump yielded rates for foreign steel and aluminum using a national security provision called section 232 of the Trade Expansion Act. That bond allies such as Mexico, Canada and the European Union, who said they were not a safety threat.
Mr. Trump used those rates as a negotiating instrument. His officials reached similarities with Australia, South Korea and Brazil, and rolled back some of those barriers in Canada and Mexico when they signed a revised trade agreement with the United States. The Biden government later reached agreements with the European Union, Great Britain and Japan to roll back some of their trade restrictions.
The United States imports very little steel or aluminum directly from China, because Chinese exports have long been blocked by a variety of anti-dumping and anti-subsidy rates. But some claim that China's surplus steel production still floods other markets and leaves global prices, giving American metal makers a disadvantage in other markets.
Brad Setser, an economist at the Council on Foreign Relations, said that the export of Chinese steel had in principle doubled over the past two years and created economic issues worldwide because they flooded foreign markets, including in Asia and Latin -America.
But Mr Setser said he saw little evidence that Chinese steel was routed by Canada or Mexico to the United States and undermined American industry.
“It is quite difficult to claim that the increase in Chinese exports has caused a reduction in American production worldwide,” he said. “The American production has been fairly stable.”
After Mr Trump was in force in 2018, the import of American steel fell steadily. But that trend returned during the Pandemie, when Hoogovens ran and the supply chains were seized and American steel makers were slower than competitors in Mexico to open again, Mr Setser said.
In recent years, the import of American steel has been relatively flat, although they are slightly above the level when Mr. Trump imposed the rates in his first term.
American trade unions and large companies such as Cleveland-Cliffs and US Steel, which influence the government, have argued that the current protection is insufficient to keep them in business. In the midst of his financial struggles, US Steel, the iconic Pennsylvania Company, agreed to be taken over by Nippon Steel from Japan. That merger was blocked by Mr Biden, who said he wanted us to stay an American company.
Proponents of the rates have argued that the United States need strong metal makers for its national defense.
Na pocket Nikakhtar, a partner at the Wiley Rein law firm and an officer in the first Trump government, said that the president was again 'good for his promise to impose rates worldwide and to increase the rates for steel and aluminum imports, considering their criticism of national security. “
But many economists claim that rates for raw materials such as steel will harm the economy because they increase prices for other manufacturers.
A study of the non -party -related international trade committee showed, for example, that Mr Trump's earlier rates encourage consumers of steel and aluminum to buy more American metals. The increase in demand pushed the metal prices and enabled American metal makers to extend, which resulted in $ 2.25 billion in extra American production of steel and aluminum in 2021.
But the rates also increased the costs for industries that buy steel and aluminum to make other things, such as industrial machines, car parts and hand tools. All in all, industries saw steel and aluminum consuming their production by $ 3.48 billion shrinking due to the higher costs – more than compensating what the steel and aluminum makers had won.
Other industries are worried about the fact that they are caught in the crossfire and are focused on rates when other countries take revenge. China imposed retaliation rates for the American export of liquid natural gas, coal, farm machines and other products on Monday in response to the rates that Mr Trump set at China last week because of his role in the fentanyl trade.
Mexico, Canada and the European Union have all drawn up lists with American products that they can touch with their own taxes in response to American measures.
For example, in response to Mr Trump's first metal rates, the European Union has imposed a rate of 25 percent on the American whiskey. A deal that is negotiated by the American and European governments to suspend those rates will soon end. If another agreement is not reached, the European Union will double that rate to 50 percent on 1 April.
Chris Swonger, the Chief Executive of the Distilled Spirits Council of the United States, said in a statement that the rate would have a “catastrophic outcome” for 3,000 small distilleries in the United States.
“We insist that the US and the EU move rapidly to find a resolution,” said Mr. Swonger. “Our big American whiskey industry is at stake.”
Colby Smith And Norimitsu Onishi contributed reporting.
