Trade

President Trump on Tuesday evening signed a proclamation that doubled Section 232 tariffs on steel, aluminum and derivative products from 25% to 50%.

Why it matters: The move marks a significant escalation in trade policy, with no exemptions or exclusions—and has immediate implications for manufacturers relying on imported metals.

The details: The new rates took effect at 12:01 a.m. EDT on June 4. There is no exemption for goods on water.

• The proclamation builds on a Feb. 10 executive order that reinstated 25% tariffs on imports of steel, raised tariffs on aluminum from 10% to 25%, revoked all country exemptions and quotas, terminated all general production exclusions granted by the Department of Commerce and rescinded the department’s authority to process any new or renew any product exclusion requests.
• Unpublished annexes are expected to provide more clarity on product scope. Guidance from U.S. Customs and Border Protection is anticipated in the coming days.

Zoom out: President Trump says domestic production capacity remains underutilized and foreign producers continue to flood the U.S. market with low-priced goods—undercutting the competitiveness of the U.S. steel and aluminum industries.

• “Increased tariffs will more effectively counter foreign countries that continue to offload low-priced, excess steel and aluminum in the U.S.,” the proclamation reads.

Between the lines: The U.K. narrowly avoids higher tariffs—for now. Steel and aluminum from the U.K. remain at 25%, contingent on compliance with the U.S.–U.K. Economic Prosperity Deal. Rates could rise to 50% on or after July 9 if the U.K. falls short.

“Stacking” reshuffled: The June 3 proclamation shakes up the May 2 tariff “stacking” executive order with key changes:

• Canada and Mexico: Products subject to new 50% Section 232 steel and aluminum tariffs are not subject to International Emergency Economic Powers Act fentanyl tariffs.
• IEEPA “reciprocal” tariffs: For countries facing “reciprocal” tariffs, companies must pay the 10% on all non-aluminum, non-steel content—or face “severe consequences” for underreporting.

The NAM says: Amid ongoing trade negotiations, manufacturers continue to press for zero-for-zero tariff outcomes with top export markets, so they have the certainty they need to plan, hire and compete—while also gaining access to the globally sourced raw materials and critical minerals necessary to make things in America.

• As NAM President and CEO Jay Timmons has stated, “If we see more trade agreements, tax reform legislation and more regulatory certainty—as part of our comprehensive manufacturing strategy—manufacturers win. And when manufacturers win, America wins.”

What’s next: Even at full throttle—every machine running, every job filled—the industry can only produce 84% of the inputs necessary to meet demand. That means at least 16% of manufacturing inputs must be imported to grow domestic manufacturing. Stay tuned for a new proposal the NAM is announcing tomorrow morning.