Trump intends to escalate import tariffs on steel and aluminium to a rate of 50%.
WEST MIFFLIN, Pennsylvania—US President Donald Trump announced plans to raise tariffs on foreign steel and aluminum imports to 50% from their current 25%, intensifying the global trade war and pressuring global steel producers.
In speech given in Pennsylvania, Trump clarified that the increase would take effect for both steel and aluminum products, beginning on Wednesday. This escalation comes less than a day after he accused China of violating an agreement to mutually roll back tariffs and trade restrictions on critical minerals.
The President made this announcement at a rally in Pennsylvania, during which he touted a USD 14.9 billion agreement between Nippon Steel and US Steel. He claimed the deal, along with the tariff increase, would help secure jobs for steel workers in the US.
Stocks of steelmaker Cleveland-Cliffs Inc surged 26% following the market close, as investors anticipated that the new levies could boost profits.
Such a move would significantly affect trading relations, particularly with Canada, as the nation remains a major supplier of US steel and aluminum imports. If Canada were to enact retaliatory tariffs—as it did in response to previous steel and aluminum levies under Section 232—it could strain diplomatic and economic relations.
Meanwhile, for China, the new tariffs would likely further reduce direct imports and deepen existing trade tensions, potentially leading to more competition in global markets. Producers outside the US, such as manufacturers in Europe, South Korea, Japan, and Mexico, might experience increased demand as a result. However, this situation could also intensify competition and cause price volatility in global markets.
- The escalation in global trade war, as a result of Trump's plan to increase tariffs on foreign steel and aluminum, is expected to significantly impact the trading relations, especially with Canada.
- In the realm of politics and policy-and-legislation, if Canada were to impose retaliatory tariffs, it could potentially strain diplomatic and economic relations.
- The announcement of higher tariffs on steel and aluminum imports would likely reduce direct imports from China, further deepening the existing trade tensions, and potentially lead to more competition in global markets.
- In the industry sphere, finance and business, the new levies could boost profits for domestic steelmakers like Cleveland-Cliffs Inc, as reported by general news outlets following the market close.
