The United States made an announcement on June 4 that it would raise the tariffs on imported steel and aluminum from 25% to 50%. This decision has triggered widespread and strong reactions across the globe. When the Asian markets opened on Monday, steel stocks experienced a general decline. As reported by The Wall Street Journal on June 2, this threat led officials from South Korea’s Ministry of Trade to hold an emergency meeting with local industry leaders on the same day, aiming to discuss the potential impact of these tariffs on steel exports.
Moreover, major steel trading partners of the US, such as Canada and the European Union, have condemned this “economic self-harm” behavior and issued warnings of taking countermeasures. It is worth noting that domestic research institutions in the US have cautioned that this move is unlikely to achieve the goal of revitalizing the manufacturing industry. Instead, it may result in a sharp increase in raw material prices, further squeezing the automotive and construction industries within the US.
Canada’s Strong Response
According to data from the US International Trade Commission, the US imported steel and aluminum products worth 147.3 billion US dollars in 2024, with Canada, Mexico, and other countries being the main sources. Marty Warren, the national director of the United Steelworkers of Canada, stated, “This is not trade policy; it is a direct attack on the Canadian industry and workers.” Additionally, Bea Bruske, the president of the Canadian Labour Congress, described the plan to double tariffs as “a reckless move” and warned that “it could completely exclude Canadian steel and aluminum from the US market and put thousands of jobs at risk.”
EU’s Regret and Warning
The European Commission expressed strong regret over the US decision to raise steel import tariffs from 25% to 50% in a statement on May 31. This move adds further uncertainty to the global economy and increases costs for consumers and businesses on both sides of the Atlantic. A spokesperson for the European Commission also indicated that the EU is prepared to take countermeasures, including responding to the latest US tariff hikes. If a mutually acceptable solution cannot be reached, the existing and additional measures of the EU will come into effect on July 14, and it is not ruled out that the relevant measures will take effect earlier.
Germany’s Concerns
Riepl, the president of the German Steel Federation, issued a written statement on June 1 local time. He pointed out that the European steel industry has been in a difficult situation in recent years. The US move to impose additional tariffs will, on one hand, increase the burden on direct exports from Germany to the US market. On the other hand, the indirect impact is even more serious: traditional steel suppliers are at risk of losing access to the US market due to high tariffs and are turning to the EU market, which will further intensify internal pressure in Europe.
South Korea’s Reaction
The South Korean industrial sector has reacted strongly to the doubling of US tariffs on steel and aluminum. According to the Korea International Trade Association, in 2024, 13.1% of South Korea’s total steel exports were destined for the United States. On June 2, the Ministry of Trade, Industry and Energy of South Korea convened an emergency meeting with representatives from the steel and aluminum industries to discuss countermeasures against the doubling of US tariffs on steel and aluminum. The Ministry stated that it will closely monitor the implementation of the US tariff measures and actively respond within the current framework of consultations with the United States, striving to minimize the impact on domestic industries.
Other Countries’ Views
Australian Prime Minister Anthony Albanese said in an interview in Hobart, the capital of Tasmania, on June 1 that the US’s increase in steel and aluminum tariffs is “an act of economic self-harm by the US, which will increase the costs for American consumers.” According to a report by the Indian economic think tank “Global Trade Alert”, the consequences for India are direct. In the fiscal year 2025, India exported related products worth 4.56 billion US dollars to the US. The increase in tariffs threatens the profitability of the country’s producers and exporters.
Experts Question the Feasibility of “Reviving Manufacturing”
Before the 50% tariffs on steel and aluminum, the US announced on March 12 that a 25% tariff would be imposed on all steel and aluminum imported to the US, which officially took effect. At that time, The Economist of the UK wrote in an article that this decision by the US government, which was intended to “revitalize American manufacturing”, was gradually showing its profound impact on the US manufacturing industry. It not only failed to increase domestic metal production as the government had expected but also put many enterprises in a difficult situation.
Boston Consulting Group estimated that the steel and aluminum tariffs that took effect in March will increase the import costs of steel and aluminum in the US by 22 billion US dollars, and the costs of derivative products such as aircraft parts will increase by an additional 29 billion US dollars. For enterprises where metals account for a large proportion of costs, the impact of US tariffs is even more severe. Industries such as excavators and other construction equipment, beverage cans, and oil drilling will all face the pressure of significant cost increases.
William Oplinger, the CEO of Alcoa, one of the largest aluminum producers in the United States, has warned that this policy might backfire and harm the industry it is supposed to protect: Tariffs could lead to the loss of 100,000 American jobs, with the aluminum industry alone losing 20,000 jobs.
Ajay Srivastava, the head of the Indian economic think tank “Global Trade Alert”, told The Indian Express in an interview that the economic impact of these higher tariffs will be significant. US steel prices are already high, and a doubling of tariffs is expected to cause a sharp increase in US steel prices, further squeezing domestic industries that rely on steel and aluminum as key materials, such as the automotive and construction industries.
Many economists and industry experts believe that the arbitrary tax rate adjustments and policy flip – flops, which bring about uncertainties, are causing multiple shocks to American businesses and consumers, and may even undermine the US government’s claimed goal of “protecting jobs”.
Unintended Consequences for Americans: Supermarket Shelves
The US Time magazine quoted Wayne M. Veenkamp, a senior fellow at the Pacific Research Institute, as saying that the US government has still not fully explained the specific calculation basis behind the doubling of steel and aluminum tariffs. He said, “The White House has never explained why 25% is a reasonable rate, let alone 50%. The rate has just been doubled.” He also believes that these tariff policies are “contradictory”, and consumers will face rising prices.
The repeated adjustments of tariff rates have also put many domestic US enterprises in a dilemma. Felix Tintelnot, an associate professor of economics at Duke University in the US, believes that the key issue lies in how long the 50% tariff will be maintained, as the rate “has been fluctuating constantly”, and the resulting uncertainty is causing substantial harm to US enterprises. This is in sharp contrast to the US government’s claim that tariffs will bring huge profits to the country’s steel industry.
According to the Associated Press, the increase in tariffs on imported steel and aluminum products may hit Americans in an unexpected place: supermarket shelves. As steel and aluminum are widely used in food packaging, the prices of goods including beer, soda, and canned food may rise as a result. Robert Budway, the head of the American Can Association, said that in recent years, the domestic production of tinplate steel in the United States has declined, causing can manufacturers to rely on imported raw materials. After the tariffs increase, this part of the cost will inevitably be passed on to consumers. “Ultimately, millions of American families will pay for this,” warned Usha Haley, a trade expert at Wichita State University. “The increase in steel and aluminum costs will affect multiple industries, and this policy cannot truly promote the long-term recovery of the US manufacturing industry.”
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