President Donald Trump announced on Air Force One Sunday that he would impose a 25% tariff on steel and aluminum imports, the latest move as part of the ongoing trade war between the U.S. and its allies.
Tariffs refer to taxes that are placed on imported goods, or products that come into the country. Importers have to pay tariffs to U.S. Customs and Border Protection, which could cause companies to increase prices on their goods to make up for the additional taxes they have to pay.
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The move is meant to help domestic steel and aluminum companies, but could also cause local companies that rely on foreign steel to struggle.
The U.S. is the world’s second-largest steel importer, with the top three import sources being Canada, Brazil, and Mexico, although other countries, such as South Korea, heavily rely on exporting steel to the U.S.
Steel and aluminum are heavily used in the automotive and construction industry, but are also used to manufacture goods and appliances.
The decision mirrors the actions Trump levied during his first Administration, when he enacted a 25% tariff on steel and 10% tariff on aluminum, though some countries, including South Korea were exempt.
In response to the most-recent tariff announcement, shares of major South Korean steelmakers in the country fell on the stock market Monday morning, while that of U.S. steel companies rose.
On average, the U.S. imports more than 2 million metric tons of steel mill products per month, according to data by the Department of Commerce’s International Trade Administration, but only about a quarter of all steel in the U.S. is imported, as total steel imports have been decreasing year-over-year.
“You see these empty, old, beautiful steel mills and factories that are empty and falling down,” Trump said on the campaign trail in October 2024. “We’re going to bring the companies back. We’re going to lower taxes for companies that are going to make their products in the USA. And we’re going to protect those companies with strong tariffs.”
The U.S. imports about half of all aluminum it uses from other countries, mostly from neighboring Canada. The International Trade Administration reports that there’s been a significant increase of U.S. imports on aluminum, up 25% from 2015 to 2022.
Earlier in February, Trump threatened to impose a 25% tariff on most Canadian and Mexican imports, though he later decided to pause the tariffs for 30 days after negotiations with each country.
Trump also issued a 10% tariff on China which remains in place. The President said he will also charge retaliatory tariffs on other countries.
