Derivative articles substantially made of steel, aluminium or copper will pay a flat 25% duty on their full value, according to the presidential proclamation on Thursday, a departure from the previous method of collecting 50% tariffs on just the metals component of a product imported into the US.
Some market sources speculated that this move would increase the import prices of derivative products.
“Articles made entirely or almost entirely of aluminium, steel or copper will pay a flat 50% on their full value — for example, steel coils and aluminum sheet,” the proclamation said.
Commodity-grade steel and aluminium are already subject to 50% tariffs on being imported into the US.
Additionally, certain metal-intensive industrial equipment and electrical grid equipment will pay 15% duties through 2027, to “accelerate the massive industrial base buildout currently underway across the United States.”
Also, “products made abroad but entirely with American steel, aluminium and copper will be subject to lower tariffs of 10%,” according to the proclamation, and products made of 15% or less steel, aluminium or copper will no longer be subject to Section 232 metals tariffs.
Kevin Dempsey, president and chief executive officer of the American Iron and Steel Institute (AISI), applauded the action.
“AISI commends the decisive action taken today by President Trump to ensure that all steel mill products, including steel pipe and tube, receive the full benefit of the 50% tariffs on steel products,” Dempsey said on Thursday.
“We also welcome the steps being taken today to simplify the process for applying the steel tariffs to critical steel derivative products,” Dempsey said.
“These measures will ensure that the steel tariff program operates effectively and efficiently and will ensure the long-term durability of the Section 232 tariffs, which remain essential to address the adverse impacts of global steel excess capacity that continues to grow due to foreign subsidies and other trade-distorting practices,” he continued.
Steel Manufacturers Association president Phil Bell had similar words of appreciation for the move.
“The Steel Manufacturers Association applauds the Trump administration’s actions today to strengthen the Section 232 steel tariffs,” Bell said on Thursday.
“By right-sizing the derivatives list and updating the valuation of steel-containing goods, these measures reinforce President Trump’s signature trade achievement, ensuring the tariffs remain precisely targeted to support the revitalization of the American steel industry without undermining broader economic goals,” he continued.
Bell highlighted the importance of expanding metals tariffs to include derivative products as well.
“Last year, the Commerce Department’s introduction of a steel derivatives inclusion process responded to urgent concerns from downstream manufacturers,” Bell said on Thursday. “While domestic raw steel production increased under strengthened tariffs, many steel-containing goods continued to be dumped into the US market, placing significant strain on American manufacturers. The robust derivatives process helped close these gaps, strengthening supply chains and supporting US manufacturing.”
US primary aluminium producer Century Aluminum also welcomed the news.
“Century Aluminum Company is applauding President Donald Trump’s new executive order that will close valuation loopholes that importers have been using to avoid the President’s tariffs on steel and aluminium, leveling the playing field for American manufacturers,” the company said in a statement on Thursday.
“Importers had been abusing valuation loopholes to reduce their liability under the President’s steel and aluminum tariffs. In some instances, importers declared only the value of raw steel and aluminium while excluding value added through processing, thereby lowering the tariff owed and disadvantaging domestic manufacturers,” Century said.
“The order clarifies that importers must declare the full value of covered products, promoting consistent enforcement and fair competition across the aluminium supply chain,” it continued.
Century CEO Jesse Gary enumerated the beneficial impact of the Section 232 tariffs on domestic producers.
“With the 50% Section 232 tariffs on primary aluminum still fully in force with no exemptions or exceptions, today’s executive order reinforces that foreign actors will no longer be allowed to game the system at the expense of Americans,” Gary said.
“Century Aluminum is proof that President Trump’s policies are working. Since President Trump reinforced Section 232 last year, with no exemptions or exceptions, we have expanded US aluminum production by 10% and committed billions to new capacity that will double US production and create thousands of new American jobs,” Gary said on Thursday.
A Canadian distributor had earlier issued a stark warning about the impact on the Canadian manufacturing sector if duties are collected on the entire value of a product rather than just the metals component.
“If they actually go forward with this, it will decimate Canadian manufacturing,” the distributor said. “Paying 25% on the entire invoice value of finished items in the 400+ list of tariff codes considered derivative will increase tariffs paid by many, many multiples.”
A second Canadian source, though, was positive about the development.
“We are paying a 50% tariff on everything top to bottom already; if they tariff 25% on the total commercial value instead of the steel content, it will improve things,” the second Canadian source said.
